Mediaboss Marketing

OTTAWA The Liberals are moving forward with their signature election promise of a broad-based income tax cut, introducing a motion in parliament that will gradually increase the personal income tax exemption for all but the wealthiest Canadians.

It marks their first policy move in the House of Commons since the election and the first test of how theyll negotiate the new minority parliament situation, as the NDP look to redirect some of the money towards dental care.

Finance Minister Bill Morneau announced the move on Monday, giving notice of a motion to raise the Basic Personal Amount the amount of income you can earn before paying taxes to $15,000 by 2023. The benefit will be reduced for those earning more than $150,473, and fully phased out for those in the top bracket (earning above $214,368).

The government estimates 20 million Canadians will benefit from the move, including a further 1.1 million who wont pay any federal income tax. When fully implemented, individuals will save $300 per year on average and families $600 per year. It will cost the federal treasury $3 billion in the 2020/21 fiscal year, rising to $6 billion when fully phased in.

Of course Conservatives always support tax cuts

The change will need to be enshrined in legislation, but for now, the introduction of the ways and means motion allows the Canada Revenue Agency to start administering it effective Jan. 1, 2020.

The Liberals first move after the 2015 election was also to implement a tax-cut campaign promise. But unlike then, this time the Liberals will need help from at least one other party to get it passed in the House of Commons.

We look forward to working with the other parties, Morneau told reporters.

This is the commitment we made to Canadians during the election campaign, Prime Minister Justin Trudeau added later in question period. We certainly hope to see support from all sides of the House on this measure.

The most likely ally is the Conservative Party, who had a similar broad-based tax cut in their platform, though the party hasnt yet said how it will vote on this. Asked about the Liberal plan by reporters on Friday, Conservative finance critic Pierre Poilievre acknowledged his party would find it hard to vote against a measure that reduces taxes.

Of course Conservatives always support tax cuts, he told reporters. Its in our DNA. Its who we are.

New Democrats, meanwhile, decided to use the opportunity to pitch their election platforms promise of dental care.

We have a better idea, NDP finance critic Peter Julian told reporters after Morneau announced the motion. He said the Liberals should cap the tax cut to those making $90,000 or less, and use the resultant savings for dental care for the 4.3 million Canadians who dont currently have a plan.

We know that relieves pressure on the healthcare system, and we know that will make a terrific difference in the lives of those families, he said.

NDP ears perked up last week when the Liberals included a mention of dental care in their throne speech. The government is open to new ideas from all parliamentarians, stakeholders, public servants, and Canadians ideas like universal dental care are worth exploring, and I encourage parliament to look into this, said the speech, written by the Prime Ministers Office.

Don Davies, the NDPs health critic, said he was somewhat heartened by the mention, though would have preferred a stronger commitment.

Parliament sits for the rest of this week and then isnt scheduled to return until Jan. 27, 2020. It isnt yet known whether the motion will be voted on before the break.

Email: bplatt@postmedia.com | Twitter:

Follow this link:
Liberals move forward on promised income tax cut, with first phase to start in January - National Post