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moneysense.ca, 26/04/06
What to Expect in the Budget
Finance Minister Jim Flaherty will present the new Tory government’s first budget on May 2, 2006. Here’s what we can almost certainly expect (from a personal finance perspective):
- A 1% cut to the GST will be one of the key features of the budget. The key unknown here is when the cut would take effect.
- Prime Minister Stephen Harper said that the $1,200 child-care allowance will be included in the budget and dared the opposition parties to vote it down (which would mean another election).
- A bevy of miscellaneous tax-cuts (transit tax credit, tax deduction for sports activities etc.) that Mr. Harper described as “all kinds of tax-cuts” during the election campaign.
Everything else is conjecture at this point. Personally, I would hope that Mr. Flaherty keeps the income tax-cuts introduced by the previous government. But, I am not holding my breath for any “surprise income tax cut I am sure Jim has up his Irish sleeve“.
Note: If you haven’t done so already, hurry up and file your taxes. The deadline is midnight on May 1, 2006.
moneysense.ca, 26/04/06
Seeing as I may benefit from a few of these things, not just the GST, I’d be quite happy to see most of them go through, but will they? Not sure. I think Mr. Harper has chosen good ground to fight on in an election, we shall see what this all means, but very itneresting no doubt.
I filed my return mid-March, and got back my refund in 8 business days, I was very impressed with E-Filing speed.
–C8j
I think the budget will pass quite easily. The Liberals are in no position to fight another election and I think the other parties are in no mood to do so. They will all complain about the budget and most of them will abstain
I have no kids and am an investor not a spender, what’s in this budget for me! Bring back the liberal tax cuts. Other countries are decreasing personal income tax and raising sales taxes instead. Might even induce people to save and invest the tax savings rather than spend it all on consumer crap.
Tom: Amen to that! This very topic was in the news a few days back. The economists in the Finance Dept. want to increase consumption taxes and reduce income taxes. Apparently, as percentage of taxes collectd, consumption taxes are the lowest in Canada among OECD nations. So, when everyone else is moving in one direction, we are moving in another.
I’d have to grant that politically the cut to the GST was a smart move. Almost everyone I talk to wants it to get done. I put it down to the fact that most people never bothered to figure out which tax-cut is better for them.
The drop in the GST has a dramatic impact on new home buyers, a 6% GST would save you about $3500 on a $350,000 house.
Jacky: New home buyers will definitely benefit to the tune of 0.7% due to the GST tax cut. (There is a 36% rebate on the GST paid upto $350,000). The GST cut does benefit some people more than the income tax cut.