Mr. Garth Turner, self-described “Canada’s foremost personal finance source” and recently minted Tory Member of Parliament, is seeking input from middle-class Canadians on what they would like to see in the upcoming Federal Budget. He mentions a few ideas, some of which were proposed in earlier election platforms. Here is my wish list for the Federal Budget:
- Keep the Liberal Income Tax Cuts: If there is one thing that is certain to be in the budget, it is the plan to cut the GST by 1%. During the 2004 Federal Election, the Tories proposed a plan to eliminate the 22% tax bracket for incomes between $35K-$70K, which I think is a much better idea. Such a significant 6% cut in taxes will immensely benefit middle-income Canadians. In principle, taxing consumption is better than taxing income (with some exceptions).
- Registered Lifetime Savings Plan: Low-income Canadians do not have a tax-advantaged savings vehicle. A savings plan to which contributions are made after-tax but withdrawals are tax-free would be a splendid idea.
- No Mortgage Interest Deductibility: Tax-deductible mortgage interest just means that house prices will increase to reflect the effective lower interest rate. To offset this break, capital gains exemption on personal residence will likely be eliminated. Why rob Peter to pay Paul?
- Hybrid Vehicle Credit: A tax credit that offsets some of the higher outlay involved in the purchase of a hybrid vehicle would be a splendid idea. The credit would save Canadians money and help reduce greenhouse emissions.
Be sure to send your thoughts and opinions to Mr. Turner. His contact information can be found here.
