Canada's poor are getting poorer!

[jbg]

Anyways, ol' Ralphie answered for Albertans on the topic quite clearly, and I stand behind his comments.

"If there are children suffering, vulnerable people, we will look after them," Klein said. "We've always said we would look after the vulnerable in society, but we wouldn't accommodate those who are employable and simply want welfare for the sake of welfare."

Klein speaks of every able bodied unemployed person in Alberta. They are committing a crime against society by being unemployed, and we have no obligation to them whatsoever.

Those that are disabled and kids, lets help them. If you can work, find a damned job. Stores and businesses are shutting their doors for a lack of people, I'd like to see unemployed people forced into these jobs or serve time as an alternative.

Ralph always speaks so well and so eloquently. The problem with him is he doesn't stand up to Ottawa and fight. He knows what Albertans want to hear. He says one thing, does another, all the time.

[jbg]

The GST is regressive, no question about it.

The good thing about it, though, is that it is highly visible, so it makes people think about whether they want the wonderful programs the government funds. Also, as a consumption tax, it wieghs less on work and effort than income taxes do.

[Hicksey]

Your post was fine until the point that you decided, for no reason, to bring Harper into it.

Harper did increase the income tax on the lowest rate by a half percentage. Most experts have said this hurt the poor the most.

$20,000 gross income averages out at about $11000 net income after taxes. This rate extends up to $36,378 of gross personal income.

$11,000 x 15.5% (current rate) = $1705 federal taxes.

$11,000 x 15% (previous rate) = $1650 federal taxes.

You're trying to tell me that pennies more than $1 a week would hurt anyone?

What a joke! A tempest in a non-existant tea cup.

That having been said, I still think that all the tax rates are too high. Everyone should be paying less by about 5% or more. If they're not going to give the money the Liberals stole from the provinces back to the provinces, it should come back to us.

[jdobbin]

$20,000 gross income averages out at about $11000 net income after taxes. This rate extends up to $36,378 of gross personal income.

$11,000 x 15.5% (current rate) = $1705 federal taxes.

$11,000 x 15% (previous rate) = $1650 federal taxes.

You're trying to tell me that pennies more than $1 a week would hurt anyone?

What a joke! A tempest in a non-existant tea cup.

That having been said, I still think that all the tax rates are too high. Everyone should be paying less by about 5% or more. If they're not going to give the money the Liberals stole from the provinces back to the provinces, it should come back to us.

Instead of lowering the GST by 1% this year and 1% in the next budget, the Tories should have lowred the income tax.

[gc1765]

Your post was fine until the point that you decided, for no reason, to bring Harper into it.

Harper did increase the income tax on the lowest rate by a half percentage. Most experts have said this hurt the poor the most.

$20,000 gross income averages out at about $11000 net income after taxes. This rate extends up to $36,378 of gross personal income.

$11,000 x 15.5% (current rate) = $1705 federal taxes.

$11,000 x 15% (previous rate) = $1650 federal taxes.

You're trying to tell me that pennies more than $1 a week would hurt anyone?

What a joke! A tempest in a non-existant tea cup.

That having been said, I still think that all the tax rates are too high. Everyone should be paying less by about 5% or more. If they're not going to give the money the Liberals stole from the provinces back to the provinces, it should come back to us.

You are forgetting that they also reduced the basic personal exemption. It's yet to be seen if they will increase it again.

[Hicksey]

Your post was fine until the point that you decided, for no reason, to bring Harper into it.

Harper did increase the income tax on the lowest rate by a half percentage. Most experts have said this hurt the poor the most.

$20,000 gross income averages out at about $11000 net income after taxes. This rate extends up to $36,378 of gross personal income.

$11,000 x 15.5% (current rate) = $1705 federal taxes.

$11,000 x 15% (previous rate) = $1650 federal taxes.

You're trying to tell me that pennies more than $1 a week would hurt anyone?

What a joke! A tempest in a non-existant tea cup.

That having been said, I still think that all the tax rates are too high. Everyone should be paying less by about 5% or more. If they're not going to give the money the Liberals stole from the provinces back to the provinces, it should come back to us.

You are forgetting that they also reduced the basic personal exemption. It's yet to be seen if they will increase it again.

The basic personal exemption, the amount Canadians can earn before paying federal income tax, will increase to $10,000 by 2009, the same target as in the Liberal economic statement last November. For the 2005 tax year, the government will keep the Liberal cut of $500, which made the basic personal amount $8,648. In 2006, the exemption will rise for the first six months to $9,039 but will be cut by $400 on July 1, when the GST is reduced, to result in an end-of-tax-year average of $8,839.

Please explain your new math to me. The last I checked $8,839 was higher than $8,648. You could also explain how a HIGHER personal exemption rate hurts the poor.

And even if the conservatives did reduce the rate by $400 for the entire year (which they did not), can you please explain how a grand total of a whopping $9 is going to hurt anyone enough that they would notice?

My source you ask? The taxpayer funded and apparently unimpeachable CBC.

[jdobbin]

My source you ask? The taxpayer funded and apparently unimpeachable CBC.

I believe there are few links already in this thread that have revised the assessment that came immediately after the budget was announced. There were quite a few fine print areas that took away with one hand, while giving with the other.

[Riverwind]

I believe there are few links already in this thread that have revised the assessment that came immediately after the budget was announced. There were quite a few fine print areas that took away with one hand, while giving with the other.

Perhaps the biggest difference between the conservative budget and previous liberal budgets is the fact that the benefits tended to go only to certain groups of people (i.e. families with children, working poor, transit users). This means that it is easy to pick someone in a group that was not the target of benefits and show how they are worse off. These means that you cannot judge the budget based on whether every single person is better off (I suspect the budget did not change much for many people - that is the nature of budgets).

[gc1765]

The basic personal exemption, the amount Canadians can earn before paying federal income tax, will increase to $10,000 by 2009, the same target as in the Liberal economic statement last November. For the 2005 tax year, the government will keep the Liberal cut of $500, which made the basic personal amount $8,648. In 2006, the exemption will rise for the first six months to $9,039 but will be cut by $400 on July 1, when the GST is reduced, to result in an end-of-tax-year average of $8,839

Please explain your new math to me. The last I checked $8,839 was higher than $8,648. You could also explain how a HIGHER personal exemption rate hurts the poor.

And even if the conservatives did reduce the rate by $400 for the entire year (which they did not), can you please explain how a grand total of a whopping $9 is going to hurt anyone enough that they would notice?

My source you ask? The taxpayer funded and apparently unimpeachable CBC.

The basic personal amount will be increased by $500 to $8,648 for the 2005 taxation year. For the first half of 2006, it will then be increased by indexation plus a further $200, for a total of $9,039. The basic personal amount will be reduced by $400 to $8,639 on July 1, 2006. For the purpose of calculating personal income taxes for the 2006 taxation year, these two half-year amounts will be applied as an annual average of $8,839.

Source

If you take out the rise due to inflation, they are raising it by $200 and then cutting it by $400. So the "new math" becomes $200 - $400 = - $200, which is actually lower (last time I checked). At 15%, the increase in taxes will be much more than anything I save from a 1% GST cut.

[gc1765]

Almost every economist out there says the best way to help the poor is to reduce income tax.

Please find me two or more that say this, real economists either with a bank or a university. A TorStar reporter doesn't count.

Here's a few: Link

[jdobbin]

Perhaps the biggest difference between the conservative budget and previous liberal budgets is the fact that the benefits tended to go only to certain groups of people (i.e. families with children, working poor, transit users). This means that it is easy to pick someone in a group that was not the target of benefits and show how they are worse off. These means that you cannot judge the budget based on whether every single person is better off (I suspect the budget did not change much for many people - that is the nature of budgets).

If Harper had reduced income taxes rather than complicated the tax code with dubious tax credits and a GST cut, he may have been on to something. His budget is a mish mash.

And a lot of the GST savings just aren't being passed along consistently. Many businesses kept their prices the same and took a bigger cut.

[jbg]

If Harper had reduced income taxes rather than complicated the tax code with dubious tax credits and a GST cut, he may have been on to something. His budget is a mish mash.

And a lot of the GST savings just aren't being passed along consistently. Many businesses kept their prices the same and took a bigger cut.

Poor to middle class people benefit by a GST cut as opposed to income tax cut in the following manners:

1. All people pay GST and GST bears no relationship to ability to pay;
   
2. Even where businesses "retain" the cut, in many cases those are small, family owned businesses that would do so; and
   
3. Income tax cuts benefit first the wealthy
   

Personally, I would have expected a Conservative to cut income taxes first, but he did have a promise to keep. In my book, keeping of promises is not often a bad thing.

[jdobbin]

Poor to middle class people benefit by a GST cut as opposed to income tax cut in the following manners:

1. All people pay GST and GST bears no relationship to ability to pay;
   
2. Even where businesses "retain" the cut, in many cases those are small, family owned businesses that would do so; and
   
3. Income tax cuts benefit first the wealthy
   

Personally, I would have expected a Conservative to cut income taxes first, but he did have a promise to keep. In my book, keeping of promises is not often a bad thing.

Some of the "small mom and pop" businessnes retaining the 1% for themselves are the cities of Calgary and Edmonton.

GST refunds are based on income.

Income tax cuts don't benefit the wealthly unless they are across the board.

Pretty much every economist in Canada and elswhere have said the cut was dumb. Check some of the links above. They don't come from far left organizations but from banks, institutes and universities.

[BubberMiley]

The GSt is a largely disposable income tax, and poor people don't have disposable incomes. GST isn't charged on the essentials like food, rent, or kids' clothes. Once those things are paid for, poor people don't have anything left to be taxed.

[Hicksey]

The basic personal exemption, the amount Canadians can earn before paying federal income tax, will increase to $10,000 by 2009, the same target as in the Liberal economic statement last November. For the 2005 tax year, the government will keep the Liberal cut of $500, which made the basic personal amount $8,648. In 2006, the exemption will rise for the first six months to $9,039 but will be cut by $400 on July 1, when the GST is reduced, to result in an end-of-tax-year average of $8,839

Please explain your new math to me. The last I checked $8,839 was higher than $8,648. You could also explain how a HIGHER personal exemption rate hurts the poor.

And even if the conservatives did reduce the rate by $400 for the entire year (which they did not), can you please explain how a grand total of a whopping $9 is going to hurt anyone enough that they would notice?

My source you ask? The taxpayer funded and apparently unimpeachable CBC.

The basic personal amount will be increased by $500 to $8,648 for the 2005 taxation year. For the first half of 2006, it will then be increased by indexation plus a further $200, for a total of $9,039. The basic personal amount will be reduced by $400 to $8,639 on July 1, 2006. For the purpose of calculating personal income taxes for the 2006 taxation year, these two half-year amounts will be applied as an annual average of $8,839.

Source

If you take out the rise due to inflation, they are raising it by $200 and then cutting it by $400. So the "new math" becomes $200 - $400 = - $200, which is actually lower (last time I checked). At 15%, the increase in taxes will be much more than anything I save from a 1% GST cut.

1. Assuming you are correct, that $200 amounts to less than $4 per week, which doesn't measurably hurt anyone.

2. If the average person spends 1/3 of their income on GST applicable items, a person earning $20,000 per year spends about $6,667 on goods they are required to pay GST on which amounts to $467. With a 1% savings they save $67 which is actually a positive balance of $36. I'll grant you they may not save much, but it is not a negative balance as you suggest.

They pay 15.5% on an extra $200 which amounts to $31, but they get about $67 back in GST.

That doesn't equal a balance of -$200 as you say, rather a postive balance of $36.

[gc1765]

2. If the average person spends 1/3 of their income on GST applicable items, a person earning $20,000 per year spends about $6,667 on goods they are required to pay GST on which amounts to $467. With a 1% savings they save $67 which is actually a positive balance of $36. I'll grant you they may not save much, but it is not a negative balance as you suggest.

That is where you are wrong. I can't speak for everyone making $20,000 a year, but I can speak for myself and other people I know. For example, out of $20,000: take off $5,000 a year for tuition, $1500 for income taxes, $8,500 for rent, $3,000 for groceries and you're left with $2,000. Most of that goes towards savings (for a house...in the distant future). If I could guess I'd say I spend around $500 on GST taxable items, so I'll save about $5 bucks, not $67.

1. Assuming you are correct, that $200 amounts to less than $4 per week, which doesn't measurably hurt anyone.

It's not a huge tax increase, but it is an increase all the same...about $31 per year as you pointed out. The tax cut from the GST isn't huge either, as I showed it's probably $5-$10 for a lot of people...or about the same as the increase in taxes due to the increase from 15% to 15.5%. So, overall those people are loosing that $31 per year. Now $31 per year is probably not a matter of life and death, but in a time when the economy is strong and tax cuts are the main priority of the government, why on earth would you RAISE taxes for the relatively poor in order to pay for the tax cuts for others, and then try to claim that you're actually benefiting the poor??

[Hicksey]

2. If the average person spends 1/3 of their income on GST applicable items, a person earning $20,000 per year spends about $6,667 on goods they are required to pay GST on which amounts to $467. With a 1% savings they save $67 which is actually a positive balance of $36. I'll grant you they may not save much, but it is not a negative balance as you suggest.

That is where you are wrong. I can't speak for everyone making $20,000 a year, but I can speak for myself and other people I know. For example, out of $20,000: take off $5,000 a year for tuition, $1500 for income taxes, $8,500 for rent, $3,000 for groceries and you're left with $2,000. Most of that goes towards savings (for a house...in the distant future). If I could guess I'd say I spend around $500 on GST taxable items, so I'll save about $5 bucks, not $67.

Nice try. You pay GST on at least half of your groceries, on all of your utilities, on books, every drink you buy at the bar, your dinner in the cafeteria etc ...

Most of the poor families you talk of have no tuition to worry about and spend their money on things like gasoline, clothing, vehicles, etc which are all GST applicable items.

I spend about $150 per month on hydro/water, $50 per month on natural gas, about $500 per month on groceries, $350 on a car payment, $120 on car insurance. Those are all GST applicable items, save for groceries which I am only counting 50% to total $920 a month and I am in the lowest tax bracket at about $35K per year. That's about 1/3 of my income. And the things I have listed are common expenses of a family of my income level and I have included no extravangances (other GST applicable items like internet, satellite, etc.)

I pay the same $31 out in extra taxes and I save about $100 to net about $69.

And families far outnumber students as far as taxpayers go.

[gc1765]

Nice try. You pay GST on at least half of your groceries

Where did you get this idea? GST is not charged on groceries (except junk food, which isn't what I meant when I said groceries, and I don't eat that much junk food anyways). I bought $60 worth of groceries the other day and paid $0.00 tax.

on all of your utilities,

They're included in my rent, and since my rent isn't decreasing I'm not saving any money.

on books

Actually, library cards are free.

every drink you buy at the bar

GST is not charged on beer, or if it is, it is included in the price. Since drink prices haven't decreased, the bars are likely keeping the savings for themselves...not that I go to the bar that often.

Most of the poor families you talk of have no tuition to worry about and spend their money on things like gasoline, clothing, vehicles, etc which are all GST applicable items.

True, which is why I specifically said that I can't speak for all families. However, many of the recent graduates I know aren't making much money, and while they don't pay tuition, most of their money goes to rent & food.

I spend about $150 per month on hydro/water, $50 per month on natural gas, about $500 per month on groceries, $350 on a car payment, $120 on car insurance. Those are all GST applicable items, save for groceries which I am only counting 50% to total $920 a month and I am in the lowest tax bracket at about $35K per year. That's about 1/3 of my income. And the things I have listed are common expenses of a family of my income level and I have included no extravangances (other GST applicable items like internet, satellite, etc.)

As I said before, utilities are often included in rent, and landlords aren't likely going to pass on savings of 2 bucks a month. And once again, groceries do not charge GST. I'd check your receipts, if the grocery store is charging you GST then they might be ripping you off. Used cars (bought privately) don't charge GST. Most poor people aren't going to buy brand new cars. Since I don't own a car I don't know whether it's better to buy privately or from a dealership, but I imagine there are probably many people who do buy their cars privately.

And families far outnumber students as far as taxpayers go.

It doesn't mean there aren't a lot of people in my situation. Most people 18-25 or over 60 that I know are in a similar situation where most of their money goes to rent/mortgage and groceries.

[Hicksey]

I spend about $150 per month on hydro/water, $50 per month on natural gas, about $500 per month on groceries, $350 on a car payment, $120 on car insurance. Those are all GST applicable items, save for groceries which I am only counting 50% to total $920 a month and I am in the lowest tax bracket at about $35K per year. That's about 1/3 of my income. And the things I have listed are common expenses of a family of my income level and I have included no extravangances (other GST applicable items like internet, satellite, etc.)

As I said before, utilities are often included in rent, and landlords aren't likely going to pass on savings of 2 bucks a month. And once again, groceries do not charge GST. I'd check your receipts, if the grocery store is charging you GST then they might be ripping you off. Used cars (bought privately) don't charge GST. Most poor people aren't going to buy brand new cars. Since I don't own a car I don't know whether it's better to buy privately or from a dealership, but I imagine there are probably many people who do buy their cars privately.

I am wrong about groceries it turns out. Except for some junk food and some toiletries and cleaning items, groceries are not taxed. I verified this using the receipt my wife just came home with.

But I know from many years of experience and many purchases all cars are taxed here in Ontario. I have owned 14 cars in my time and every one has been taxed at the time of title transfer no matter how transferred (fit/unfit). My present car isn't new, I recently bought a 2003 Pontiac Montana minivan. Most of my friends' incomes are in line with mine and it was all of them that recommended I buy used as they did. I have bought cars for prices ranging from $100 to $13,000, and ranging from 3 to 13 years old and have had to pay tax on all of them.

Where you come from they might include utilities in rent, but down my way since the volitility of utility rates one is hardpressed to find a place with more than water/sewage charges paid. I pay $575 plus hydro/gas/water/sewage. This is the most common situation where I live and as far as GST costs it brings renters in line with home owners save for renovation/home improvement costs.

[gc1765]

But I know from many years of experience and many purchases all cars are taxed here in Ontario. I have owned 14 cars in my time and every one has been taxed at the time of title transfer no matter how transferred (fit/unfit). My present car isn't new, I recently bought a 2003 Pontiac Montana minivan. Most of my friends' incomes are in line with mine and it was all of them that recommended I buy used as they did. I have bought cars for prices ranging from $100 to $13,000, and ranging from 3 to 13 years old and have had to pay tax on all of them.

Well you probably know better than me since I"ve never bought a single car. I just got my info from Here (at bottom of page) where it says GST is not charged on used cars bought privately, which makes sense. I don't own a car so it's not going to help anyways, even if GST is charged.

[Topaz]

If anyone thinks getting a $1000 per month is heaven trying living on it! Even most parents have to charge something to their kid, unless their high paying professionals and don't need the money! Most rents are at least 500.00 up, depending where you live, then there's food, hydro, if it not included in your rent. If you had been working and loss your job and have gone through EI, welfare is next. There's no money for a car if you need one to get to work because you live outside of the city because you can't afford the rent! How do families on welfare make it????

[jbg]

1. Assuming you are correct, that $200 amounts to less than $4 per week, which doesn't measurably hurt anyone.

*snip*

That doesn't equal a balance of -$200 as you say, rather a postive balance of $36.

Money for beer and popcorn.

[Hicksey]

But I know from many years of experience and many purchases all cars are taxed here in Ontario. I have owned 14 cars in my time and every one has been taxed at the time of title transfer no matter how transferred (fit/unfit). My present car isn't new, I recently bought a 2003 Pontiac Montana minivan. Most of my friends' incomes are in line with mine and it was all of them that recommended I buy used as they did. I have bought cars for prices ranging from $100 to $13,000, and ranging from 3 to 13 years old and have had to pay tax on all of them.

Well you probably know better than me since I"ve never bought a single car. I just got my info from Here (at bottom of page) where it says GST is not charged on used cars bought privately, which makes sense. I don't own a car so it's not going to help anyways, even if GST is charged.

I pulled the receipts from my last car, bought privately, and when I registered the vehicle under my name I was charged both PST and GST. If that document is true, Drivers & Vehicles is guilty of fraud.

Though you won't get much help from the GST, someone who doesn't own a car like you did get a break. You get to write off your use of the public transportation system.

[gc1765]

Though you won't get much help from the GST, someone who doesn't own a car like you did get a break. You get to write off your use of the public transportation system.

I think the public transit tax credit is an excellent idea which will help a lot of people. My bus pass is built into my tuition though, so I'm not sure if I'll get a break or not. Oh well.

[Hicksey]

Though you won't get much help from the GST, someone who doesn't own a car like you did get a break. You get to write off your use of the public transportation system.

I think the public transit tax credit is an excellent idea which will help a lot of people. My bus pass is built into my tuition though, so I'm not sure if I'll get a break or not. Oh well.

The point of that post was to point out that the tax cuts were targetted. A very wide spectrum of low to middle income homes will benefit. Some more than others, but a lot of people will benefit. I believe it should have been much more tax relief than it was.