Daily Economic Comment - Albertan Tax Refund Intentions
Posted By: Will van ‘t Veld Economist, ATB Financial Apr 10, 2012
Easter’s over and the next big date on the calendar is the end of the month, tax filing season is upon us. While it’s hard to find anyone who actually enjoys paying taxes, it’s a necessary evil and more Albertans than not will actually be receiving money from the government—so what do they plan to do with it?
According to the results of a survey conducted by ATB Financial, 60% of Albertans are expecting to receive a refund this tax season. This compares to 22% who will have to square up with the government and 19% who figure their accounts with the government are about even.
It doesn’t appear as if most Albertans who expect a refund intend to use it for conspicuous consumption. When asked what they intended to do with the funds, a preponderance indicated a desire to pay credit card bills (42%). This was a particular concern for younger individuals (aged 18-34). This might be a result of bills remaining from the holiday season.
About 28% of respondents expected to hold higher cash balances, which likely means they don’t know what they plan to do with it yet, and 23% expect to use their refund to help pay for an upcoming vacation. For whatever reason, perhaps being located farther north, Edmontonians showed the most interest in spending their refunds on a vacation.
Relatively few Albertans intend to save their refund. Only 11% indicated a desire to use their funds to top up retirement savings. This might not be surprising, given that a good chunk of refunds are likely due to RRSP contributions made earlier in the year.