How to Cut Taxes

Canadians who had waited two years for the government to take another slice off their high-level wartime taxes got good news last week. In his budget speech, Finance Minister Doug Abbott announced that the government would reduce its revenue from income taxes by 32%. Accordingly, he took 750,000 taxpayers off the lists by raising the exemptions from $750 to $1,000 for a single person and from $1,500 to $2,000 for a married couple with no children.* For those who still had to pay, the rates were trimmed. The new rates and exemptions would be retroactive to the first of the year (and the refund checks would go out just before election time).

Abbott also announced a cut in some corporate taxes, then set about wiping out or paring down excise and luxury taxes. The 15% travel tax on plane and rail fares and the tax on sleeping-car berths were dropped. So were taxes on long-distance telephone calls, telegrams, soda pop, gum and candy. The 25% tax on jewelry was shifted from retailer to wholesaler and reduced to 10% (immediate effect: retail stocks of jewelry were tax-free).

Summing up, Doug Abbott reported that the budget was planned to show a surplus of $202 million next year. In an election year like this one, it was also planned to catch plenty of votes.

* Compared to current U.S. exemptions of $600 and $1,200 respectively.

This file is automatically generated by a robot program, so reader's discretion is required.