"But big tax cuts cost big money. As the Star's Les Whittington reported this week, one of the anticipated cuts is income splitting, a neo-conservative pet project that would reduce federal revenues by — holy smokes — $5 billion annually.Is that good value? Or just family values reinforced with a tax break for stay-at-home parents?" Asks Toronto Star Columnist Jim Travers.
Why of course it's Conservative family values writ across the tax code. It certainly is neo-con politics and bad economics. It fails to address the need to change the tax system to reflect 'individual' taxation rather than family taxation.
It is an extension of the Tories Child Care Benefit, doling out money to their base, the middle class, while failing to provide for needed social programs like daycare. Calling it all along tax fairness which it is anything but.
Because they are not taxing profits from corporations, financial markets, and money markets anywhere close to what they tax Canadian citizens. Nor have they reduced EI payments nor expanded EI payouts.
Neither have they addressed the need in Canada for a Living Wage/Guaranteed Annual Income for the working poor the majority of whom are women.Single women, just as the majority of surviving pensioners are single women. So income splitting does not address their economic needs.
"All the fevered talk about falling birth rates and the need to import skills, labour and consumers misses the central point that contradictory tax and support policies ensure the working poor aren't escaping poverty or contributing fully to the economy.Part of the problem is that politics and life are on different cycles. A middle-class tax windfall is rich with immediate promise for the party in power while education's rewards are a generation away. Even less appealing are the high costs and low returns of attacking something as significant, and yet as arcane, as the marginal tax rates that help keep the poor, well, poor. Parties know people struggling through life stay home on election day."
Ironically the idea of income splitting is not even Flaherty's, it belongs to Garth Turner whom the Conservatives kicked out of caucus a month ago. And they only adopted it for seniors to offset their broken promise when they taxed Income Trusts.
This is conservative social engineering through the tax system.
See
Not Real Tax Fairness
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