Friday, February 9, 2007

Income splitting for families still an option: Flaherty

i've voiced this before, and again, i will. this may help the middle class, but shouldn't we be helping the lower income / single parent families or the working poor ... they don't count? to help those less fortunate is not on the agenda for the conservatives? shameful.

Income splitting for families still an option: Flaherty

Finance Minister Jim Flaherty says he hasn't ruled out including income-splitting for families in his coming federal budget.

Flaherty says the option is still on the table for the budget, expected March 20, despite media reports that he had decided not to pursue it.

"Joint filing is one of the items that is on the table," Flaherty told The Canadian Press in an interview from Rome.

"We've already agreed and announced that we'll go ahead with joint filing for pensioners and seniors with respect to pension income.

"Whether we go further than that will depend on the choices that we make as we get closer to budget day. I certainly want to see how the economy is doing and how our revenues are doing. I'll see that better later in February when we see the most recent figures."

Last week, a government official said it's "highly unlikely" income-splitting will be in the budget, adding it's nowhere near the top of the priority list.

The measure would allow couples to file their tax returns jointly, letting a higher-earning spouse offload part of their income to a partner and potentially save thousands in taxes.

But it could cost the government more than $5 billion by some estimates.

The Conservatives had considered including the measure in their last election platform but opted against it, largely because of the price tag.

Flaherty said the three Es - environment, economy and education - will remain the government's top priorities for the budget.

"We're going to be balanced and take into consideration Canada's role as an energy consumer and energy producer.

"We're an emerging energy superpower in the world and we're going to make sure on the environmental side that we're going to act in a constructive way looking at the long term and not just the moment and making sure that we preserve jobs in Canada."

He said the government is considering initiatives to encourage energy conservation, but no decisions have been made.

"I think it's reasonable to assume that we're going to keeping with environmental initiatives. We're having further discussions with the oil-and-gas industry. We're having a further meeting with the automotive CEOs in Toronto next Friday, which will be our third meeting."

Flaherty said the government has to carefully balance tax cuts with environmental spending, saying taxes are too high in Canada.

"This requires prudence in what we do and we're being careful to maintain those principles. But we are in surplus and we're carefully managing spending this year, so I'm comfortable with where we are."

The government agreed last fall to allow income-splitting for pensioners, partly to take the sting out of its unpopular move to tax income trusts.

The Canadian Taxpayers Federation calculates that a single-income family with a $100,000 earner would save $4,320 this year under a split-income scheme that would allow each spouse to declare $50,000.

By way of comparison, a family with one $75,000 earner and a $25,000 earner would save $1,000 if they split their declared income.

A federal study says the move would benefit more than 1.4 million Canadian families - over two-thirds of them with income above $90,000.


wilson61 said...

Income splitting is a costly, narrow focus tax cut, it's not a good idea. IMO the Cons will not do it, but Flaherty just put it back out there to get a dig at Garth because Libs are absolutely against it.

audacious said...

well i hope you are correct!:)