Up here. On personal tax;
– Reduce the GST from 7 per cent to 6 per cent at a cost of $8.6 billion over two years.
– Create a new Canada Employment Credit worth up to $1000. This will cost $2.7 billion over two years.
– Reduce the lowest tax rate from 16 per cent to 15.5 per cent. This will cost $3 billion dollars over two years.
– The basic personal exemption, the amount you can earn tax free, will increase slightly to $8,839. This change will cost $1.58 billion over two years.
– Changes to the rules to allow for the family transfer of fishing property at cost of $120 million over two years.
Emphasis mine, because for some time now, I’ve wondered how it came to be that leaving money in the hands of those who earned it came to be redefined as a “government cost”.
Shouldn’t it be “taxpayer saving”?
From the comments, Chris caught this bit of prose fresh from the “throw a plate of rhetorical spaghetti on the floor” school of journalism;
Now, my favourite part of the CTV’s story is when they say:
“But in an unexpected turn of events, the budget also reneges on the Tories’ pledge to completely eliminate the Liberal’s planned income-tax relief.”
B*$t@rd$! Reneging on a pledge not to cancel tax cuts. What jerks.
More reaction from Stephen Taylor.
Dep’t of Finance 2006 budget page.
Kate
I’m not sure that the second point is correct. As I understand it the lowest tax rate will be increased to 16.5% from the current 16%.
At least that is what CBC, CTV are reporting and the Libs and NDP are making much of this point.
Syncro
For some time I have wondered the same.
Big Brother is alive and well in the Canadian Media.
Freedom = Slavery
Money back to the people who earned it = “cost”
Actually, the lowest tax bracket is currently 15% and will be raised to 15.5% as part of the budget. It’s a shame they didn’t reduce some of the higher brackets by a percent or two.
It is a cost the same way patients are a cost on the healthcare system.
“I’m not sure that the second point is correct. As I understand it the lowest tax rate will be increased to 16.5% from the current 16%.”
The new tax rate for the lowest income bracket will be changed to 15.5% (its either a hike or a cut depending on who’s spinning)
My bad. Thanks Lew. On further examination you are correct with the increase coming July 1.
Syncro
The rate you are speaking about is presently 16% and the gov’t is reducing it to 15.5%.
The confusion arises as the Libs planned to make that rate 15% in their tax plan, so that is why you have McCallum taking about a “tax increase”.
The CPC counter is that total tax paid is less (twice as much less) than the Lib plan, if you consider the GST cut, etc, as well as that the CPC tax reduction includes more people.
I think this is a good budget which is reducing taxpayer debt burden. I would have liked to have heard something about employment insurance rates being reduced (the program routinely brings in huge surpluses), but I’m overally happy with the reductions.
I haven’t really read the documents in detail. Anyone know what cuts have been made to existing programs?
Liberals are of course refusing to cooperate, stating that they will not support the budget, before it was even dropped. Like they are even close to being in the position to run an election on this, clowns.
Interesting. All the tax cuts are listed in the link as *costs*, and almost none of the increased expenditures are. Call for George Orwell, white courtesy telephone please.
You might also like to note that CBC Radio Three-Eighths (formerly known as Radio One) broadcast 23 minutes of the Minister’s speech, and spent 53 minutes talking mostly to opponents of the Government and the Conservative Party of Canada. Coverage of the budget speech at 16:00. They talked to a real-estate guy and a CBC staffer. At 16:11:08 they started transmitting the Finance Minister’s speech, after he had *already* been speaking for a few minutes.
They then transmitted 7:47 of the speech, and then interviewed Jack Layton for 3:39. Then the speech for 4:22. Then went to a CBC panel for 5:14. Then to the speech for 1:46. Then they talked to some union guy for 3:35. Then the speech for 5:54. Then to Bill Graham for 2:38, and their panel for 7:01, and then Gilles Duceppe for 4:40, and their panel for 2:27. Then back to the speech for 1:50, then some Indian guy for 3:35, then their panel for 2:09, the speech for 1:14. That was the end of their coverage of the speech, even though the Minister had not finished. Then their panel for another 6:00, the Public Works Minister for 0:53 and then panel for another 1:17.
If the CBC can’t even broadcast the Minister’s budget speech in its entirety, and if they spend 2/3 of their time dissing the budget *while* it’s still being read, I fail to see why the CBC should not be completely divested of public funds.
Both the Liberals and the NDP are, crassly, refusing to support the budget. Sheer pompous politiking.
They KNOW that they can safely assert this rhetoric, because they KNOW that the Bloc is supporting the budget. Therefore, there won’t be an election – an election which would demolish both the Liberals and the NDP to crumbs and cold milk.
So- they can take the ‘high road’, and walk on air, pretending that they are superior, knowing that their vapid rhetoric cannot be called to account. Hmmm. Isn’t that just the way they always behave?
Kate, also check how the word “invest” has replaced the word “spend” in today’s lexicon when it comes to government money.
‘The confusion arises as the Libs planned to make that rate 15% in their tax plan, so that is why you have McCallum taking about a “tax increase”.’
There isn’t much confusion if you look at the 2005 tax return. It was 15% for 2005.
Nasty little proles, costing the government billions of dollars.
Todd: As far as I can tell – Kyoto and Kelowna are dead in the water, which is a good start.
All in all, a good political budget that should ensure a Tory majority in the next election.
Personally, after the bracket increase and the increase in sin taxes, minus the personal exemption increase, I will be lucky not to be paying more taxes this year.
Maybe when they get their majority we will see some personal tax relief.
Vitruvious, who the hell want to sit and listen to a politician drone on for an hour? No media outlet (except perhaps CPAC) has ever carried the entire speech. I’m surprised they aired that much.
For the record, the liberals cut the bottom tax rate from 16 to 15 retroactively to last year. The conservatives will keep that rate until July 1, when they will raise it to 15.25. Then next year they will raise it again to 15.5.
Of course, this is totally absurd. They are forecasting an 8 billion surplus but they are still raising income taxes. Embarrassing.
All these comments so far lend me to believe you are all card carrying Conservatives.
It must be hard to admit we’ll be going to the polls again. Looks as though this budget has the life expectancy of a ice cube in hell
In fact, the 15% rate was legislated, so the Tories are raising it to 15.5%. However, that is being charged on less income, as the basic personal exemption is increasing by about $2000, so while you’re paying a half point more on $26000, you’re saying 15.5% of $2000, which is a lot more.
So, when John McCallum and John Williamson (of the CTF) both talk about tax increases, they really are spinning. What would you rather, that I charge you 49% on all of your income, or 49.5% on half? John Williamson thinks the first is better based on his CTV interview.
It must be a good budget because the Liberals , the NDP and the MSM are completely spazzing! I cannot believe my ears–McCallum stating that the Liberals worked so hard to balance the budget–yeah–adscam, pizza, gun registry, Pettigrew’s boyfriend travel expenses, paying the lawyers for their fellow thieves, dingwall–and that is just the recent ‘hard work by the liberals’–how can McCallum and the MSM talk with a straight face without throwing up over their lies. Watch for some long noses by morning!
From what I understand from the budget details, the increase from 15% to 15.5% is effective July 1st. So the average increase for the entire year (2006) will be 0.25%. I.E. the lowest tax bracket tax rate will average 15.25% on our 2006 taxes, and will be 15.5% on our 2007 taxes.
Regarding:
“- Reduce the lowest tax rate from 16 per cent to 15.5 per cent. This will cost $3 billion dollars over two years”
they are actually increasing the lowest tax rate from 15 to 15.5%.
Now, my favourite part of the CTV’s story is when they say:
“But in an unexpected turn of events, the budget
also reneges on the Tories’ pledge to completely
eliminate the Liberal’s planned income-tax relief.”
B*$t@rd$!
Reneging on a pledge not to cancel tax cuts. What jerks.
Craig Oliver could hardly keep from laughing at Bill Graham when he said that the Liberals would vote against the budget.
I was just going to ask Beardie if that “laugh in Bill Graham’s face on national TV” moment was the one that convinced him the budget “has the life expectancy of a ice cube in hell”…
I can’t imagine who, David, except perhaps conscientious Canadian citizens who are interested in hearing our government’s plans first, and the opposition’s response second.
I agree with Peter. Also, Cree is wrong, the BQ are supporting and they have what, 51 seats, and the government only needs 29 to pass the budget.
I don’t see any show-stoppers in this budget or the early analysis I’ve spent the last hour reading. Next up, the auditor general’s report on May 16.
Some rough math (Assuming you made at least $35,595):
2005 taxes on $35,595 (@15%) = $5339.25
2006 taxes on $35,595 (@15.5%) = $5517.23
– additional personal income taxes = $177.98/year
2005 Personal Exemption: $8648
2006 Personal Exemption: $8839
Tax savings: ($8839-$8648) * 15% = $28.65
If you are in the next bracket (22%), you also get the personal exemption savings of $ 42.02, for a total of $70.67
In this example, personal taxes are up $107.31
This does not factor in the myriad of other deductions of course. But as none of them apply to my situation, I will be paying $107.31 more this year. Minus whatever I save on the GST. Looks pretty even to me.
Paul Who?s Kelowna Thing is dead. +
CBC News: Ottawa pledges $5 billion to aboriginals
Martin called the deal, reached after intense negotiations in Kelowna, BC, with premiers and a handful of aboriginal leaders, “an unprecedented step forward …
http://www.cbc.ca/story/canada/national/2005/11/25/aboriginals051125.html – 29k –
OT, but related, no?
Potential Guite jurors line up
MONTREAL (CP) – Dozens of potential jurors rushed the clerk’s table at Charles Guite’s fraud trial on Tuesday – not in the usual pursuit to get out of jury duty, but instead to sign up to be a candidate. via cnews +
Revenge of the Quebecois. Bien sur. +
Anyone know just how many people went to residental schools? $2,200,000,000.00 is a lot of money for compensation.
Liberal government throws out an election bone on the income tax and now the government is shafting the taxpayer??? Give me a break. If PM (as in Paul Martin) wasn’t so worried about losing the election you would have paid that 16% for last year.
As a crippled fella living on my Long Term Disability (No questioning whether or not I am disabled, I’m wheelchair bound) the budget has two nice things that’ll make it that bit easier to make ends meet for me.
GST cut, the only tax I pay gets cut. every little bit helps.
Child Tax credit, I got a 5 year old son and $100 a month will be a nice help.
I also lost count of the KEPT promises. Amazing that the Gvt. is doing what thier told!
On the other hand, if you have family, especially kids under 6, you have hit the jackpot big-time today.
Liberal MPs incinuating the Liberal controlled senate may send the budget back to the house
“Liberal MPs incinuating the Liberal controlled senate may send the budget back to the house”
The Librano$ never do give up. The election was over months ago.
Agree Vitruvious, if the CBC is not going to give our Finance Minister the courtesy of televising his remarks without interruption then they are acting like any other commercial media outlet, motivated by ratings.
If they are just like the others why do we need them? Why are they tapping into my wallet?
I can�t wait until we get majority and eliminate taxpayer subsidy of the CBC.
“The new tax rate for the lowest income bracket will be changed to 15.5% (its either a hike or a cut depending on who’s spinning)”
Andrew Smith posted at May 2, 2006 06:14 PM
Wish more people were as clear-cut as Mr. Smith. I’m particularly surprised at John McCallum, who in a “previous life” apparently did a creditable job as Senior Vice-President and Chief Economist of the Royal Bank.
Costs = money the government doesn’t take
Savings = Amount that government spending was projected to increase minus the amount that spending will increase
Peter Loewen… The basic personal exemption is currently $8,648.00. It will increase to $8,839.00, if the numbers in this post are correct. Where do you get $2,000.00?
Gabby – JM is left of Galbraith.
I noticed Jack Layton singing the praises of Galbraith today .. ‘nuf said.
What I don’t get is this CTV tidbit:
‘Graham said the budget offers little financial help for upper-income Canadians.
“In terms of taxes, there’s little benefit for upper-income Canadians in it,” he said.’
I thought the whole basis of Liberal opposition to this budget was that it would be taking money from lower-income Canadians and giving to the upper-income? Since when have the Liberals suddenly become such ardent defenders of the fabulously rich and wealthy?
Eugene: Since they became the Official Opposition.
Based on more reading at the MSM sites, I’ve formed a working hypothesis on the principle implication of this budget.
I think this is the most important news out today (this text from the Globe & Mail): “Although the inaugural Conservative budget was immediately attacked by the Liberals and the New Democrats, who said it failed to meet the needs of working families, it won’t mean the defeat of the Harper government because the Bloc Qu�b�cois says it will support the document. “We’re supporting it from one main reason, one important reason, it is a firm intention to address the question of the fiscal imbalance,” Bloc Leader Gilles Duceppe told CTV Newsnet shortly after the budget was tabled in the House of Commons on Tuesday.”
My hypothesis then, is that this is a decentralization-enabling budget. Mr. Harper has set up the dominoes for reallocation of resources from the federal orbit to the provincial oribit this autumn. To the degree that I am correct, this budget is looking better minute by minute.
The Liberals have been talking out of both sides of their collective mouths all day, they are masters of the sound bite media.
Today they tried to provide a reason for everyone to hate the new budget. Anyone with a brain who’s willing to look at it will find some sort of benefit for themselves.
The Bloc’s reaction to the first Harper budget shows what to expect during this session of Parliament. Harper set out to woo Quebeckers with money, and with his promise to take money from the federal government and give it to the provinces � a sum far exceeding the thirty shekels of biblical fame � he has succeeded in turning Duceppe into a Harper Groupie.
It sure did not take much to sway Duceppe: more money for the provincial government? Count me in, he said. Even if this came at the cost of the scrapping of the daycare program designed to provide sustained spaces for children, and the deal cut in Kelowna to help the First Nations ….
Really, Mr Duceppe: what happened to your many statements that your party was in Ottawa to make sure t hat the federal government worked for Canadians?
Harper suckered Duceppe once before, when he stampeded Layton and Duceppe into calling an early election in 2006. Now he is setting the Bloc up as a patsy again: throwing some money to the provinces at the cost of reducing the strength of the central government.
The pattern is crystal clear: the separatist Bloc and the anti-Canadian government Harper believe in the same thing � a weakened Canada and a balkanized system of provinces with enhanced power.
Who will speak for Canada?
Not the separatist Bloc, and not Harper and his neocon New Tories.
Curiositykilled….ah whatever:
time to get you tinfoil hat out maybe?
Thanks for taking time out of your Liberal blogging to stop by and offer us such credible thought. Been cooking that one up all day have you?
CuriosityKilledTheCat you need to get back on your meds.
Cat,the only thing you left out in your talking points was the name of George w.Bush..although i am fairly certain that left to your own devices and given time,that too would have come to pass.
“Who will speak for Canada?”
Harper is doing a fine job I would say.
Separatism is in it’s death throes here in Quebec, with the Tories passing the Bloc in popular support this week.
Duceppe is stuck between a rock and a bigger rock. If he votes against Harper and brings down the government, his party will lose even more seats in Quebec.
Harper has forgotten some of his economic roots, especially with this budget, but he has mastered Canadian politics at light speed.
No, live Cat, it’s perfect. If someone didn’t get to it soon, both Quebec and Alberta were looking unpleasent. This way, Mr. Harper saves the country simply by returning to the power-sharing provisions of the constitution (s.91 isn’t it?).
Lew: “Separatism is in it’s death throes here in Quebec, with the Tories passing the Bloc in popular support this week.”
Source? I’m finding this very hard to believe, even with Harper gaining popularity the way he is.