Mr. Speaker, at the start of the 18th Legislative Assembly, we reviewed our tax regime to ensure that we are raising the revenues we need to fund important programs and services while also encouraging people to live and work in the NWT and for businesses to invest in growing our economy. As always, we need to balance our revenues with real concern about the high cost of living in our territory. The few options that could generate significant revenues would leave individuals and families with fewer dollars in their pockets and risk discouraging business investment and economic growth.

Although there are no new taxes announced in this budget, we intend to adjust some taxes and fees for inflation and to better reflect the cost of providing services. We also will raise tobacco taxes to 30.4 cents per cigarette and 27.2 cents per gram of loose tobacco, effective April 1, 2017.

With the amendments to the Revolving Fund Act we are proposing, we will be setting up a revolving fund for the Yellowknife Airport so that the revenues that the airport generates are used to fund ongoing capital and operations and maintenance expenditures. The revolving fund will give the airport the flexibility to make improvements to support air carrier operations, increase the number of services available to travellers, create new business opportunities, and transform the airport into a key asset to shape our future economy.

We have signed the Pan-Canadian Climate Change Framework and have committed to investigating the introduction of a price on carbon of $10 per tonne of greenhouse gas emissions in 2018-19. Significant work remains before a carbon price could be introduced, including developing appropriate offsets to mitigate adding to the already high cost of living and doing business in the Northwest Territories. The purpose of carbon pricing is to provide price incentives to reduce greenhouse gas emissions. However, we know that, until there are economically-viable alternatives, carbon pricing mechanisms alone will not significantly reduce greenhouse gas emissions in the Northwest Territories, especially since the high fuel prices already create an incentive to curtail consumption of carbon-intensive fuels in the territory's communities and within the business sector.

This Assembly already has made investments in alternative energy options for territorial residents and businesses a priority. We expect to continue to make investments in alternative energy and to work closely with the federal government in our efforts to provide reliable, affordable alternatives to carbon-intensive fuels for our communities and businesses.

Mr. Speaker, next year we also intend to investigate introducing a sugary drink tax as a price incentive to discourage the consumption of sugary drinks that are linked to health issues such as obesity and diabetes. While our intention is to introduce a sugary drink tax in 2018-19, we will take the time during the upcoming fiscal year to ensure our approach is as effective as possible.

The tax and fee increases proposed for this year, while important, will not solve our fiscal problems. Instead we intend, through our commitment to our fiscal strategy, to not only introduce modest revenue initiatives but also to carefully manage expenditures so that we will have the fiscal flexibility to make investments to support and grow our economy so that our tax base expands and our revenue increases.