by REAL Women of Canada. October 30, 2014
Prime Minister Stephen Harper’s announcement today of his government’s tax policies for families, is great news for families struggling to raise their children in these difficult economic times. It is also an acknowledgement of the importance of the family and its children who are the very foundation of Canadian society and its future.
The policy on income-splitting now means that a spouse is able to transfer income for tax purposes up to $50,000 to the lower-income spouse with children eighteen years and younger, in order to collect a non-refundable tax credit of up to $2,000 per year. This break means that it is the middle and lower income families, not the higher income families, who will benefit from this “Family Tax Cut”. Other families that will not benefit from this policy, such as single parents, or those who do not pay any income tax at all, are already looked after by other benefits under the Income Tax Act.
Income splitting is not a new policy as it has been made available previously for seniors’ pensions, and to self-employed spouses and farmers. Also, forms of income-splitting are available for families, under the Goods and Services Tax Credits, and Spousal RRSPs. Income splitting for families with growing children, is just keeping pace with this trend.
Family income-splitting is a legitimate form of tax sharing, and is a welcomed remedy for the disparity in taxes paid by sole and dual family income earners with the same income. This blatant discrimination has now at last been remedied.
REAL Women has long advocated for an increase in the Universal Child Care Benefit. This new policy has increased the benefit to $160 a month from $100 a month for children 6 and under. Also beginning in January, these taxable payments will go to families with children age 6 through 17 at $60 a month. REAL Women is grateful for the acknowledgement that parents with children over 6 years of age also have heavy expenses in raising their school aged children.
These changes, are an acknowledgement that all parents are important whether their children, are placed in daycare or raised at home.
According to REAL Women of Canada National Vice President, Gwendolyn Landolt, “The government’s policies on families announced today are a tribute to parents and children who play such a crucial role in society.”
By Gwendolyn Landolt, REAL Women of Canada, October 30, 2014