Re: (Black Press Election 2019 series, Oct. 17)
While the overall message of the article provides a broad-strokes description of the major parties’ tax policies, Tom Fletcher cites a that found the Liberals’ tax changes caused 80 per cent of middle-class families to pay more taxes.
To generate this estimate, the authors of the report considered the net impact of a portfolio of Liberal tax changes. They looked at the middle-income rate reduction, the introduction of a new high income tax bracket, the elimination of income splitting, and the elimination of four different tax credits targeting families with children.
They chose to exclude from their analysis the replacement of the Canada Child Tax Benefit with the Canada Child Benefit, their reasoning being that this program is a transfer and not part of the income tax system and is therefore outside the scope of the study. Their report is on tax changes and tax changes alone. As such they found that the average middle-class family with a household income between $77,089 and $107,624 paid $644 more tax per year as a result of the Liberal tax changes.
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The exclusion of the CCB means that the authors potentially did not account for as much as $3,796 in benefits for the class of family that is the subject of their study. Considering the full range of incomes identified in the study as “middle-class,” for a family with one child the analysis excluded benefits ranging from $1,782 to $3,796 per year.
Given these numbers, I find it unlikely that any middle-class parents found themselves poorer because of the Liberals’ tax policies, no matter how accurate the Fraser Institute’s estimation of an average annual net tax increase of $644 is. Further to that, the Department of Finance estimates that the CCB has lifted 300,000 children out of poverty in 2018, which might be the most positive news I have heard about our country for a long time.
Focusing exclusively on taxation the way the authors of the Fraser Institute’s report have done might provide us with accurate figures within the context of their narrow methodology, but ultimately misses the bigger, and in my opinion, more relevant picture.
Ian Benoit, Port Alberni