Garth Turner wants to see full income-splitting

[Pat Coghlan]

On his blog, Garth is saying that he is going to push the Liberal party to extend income-splitting to all families, not just pensioners.

Like, would we ever see a left-of-center party implement a tax change that would encourage more stay-at-home moms?

http://www.garth.ca/weblog/2007/04/14/stuc...iddle/#comments

[ScottSA]

On his blog, Garth is saying that he is going to push the Liberal party to extend income-splitting to all families, not just pensioners.

Like, would we ever see a left-of-center party implement a tax change that would encourage more stay-at-home moms?

http://www.garth.ca/weblog/2007/04/14/stuc...iddle/#comments

Not ever. Nor a tax change that would actually decrease taxes.

[scribblet]

I'm with Garth on this one, but I agree, doubt the Liberals will want to reduce our taxes. I don't see why people are against it because stay at home mom's might benefit. I'll sure benefit and I'm not a stay at home mom cos I have the higher income, any couple where one has a higher income than the other should benefit.

This will be interesting to see how long the Liberals will tolerate Garth or vice versa -

[ScottSA]

I'm with Garth on this one, but I agree, doubt the Liberals will want to reduce our taxes. I don't see why people are against it because stay at home mom's might benefit.

It's the conflict between the "progressive" view that government ought to have the revenue so they can do things and the "rightwing" view that people are able to make their minds up by themselves what they ought to do. The tax system itself is still suffering from the feminist hangover of trying to force women into the workplace, and that's both why it's being rolled back and a source of conflict from the "progressives" still stuck in the 80s.

[Michael Bluth]

Garth Turner wants to see justice done ... which means Garth Turner back in cabinet.

[Pat Coghlan]

I'm with Garth on this one, but I agree, doubt the Liberals will want to reduce our taxes. I don't see why people are against it because stay at home mom's might benefit. I'll sure benefit and I'm not a stay at home mom cos I have the higher income, any couple where one has a higher income than the other should benefit.

Families with nice, split incomes don't support it because they fear their taxes will go up...until they find themselves retired with one spouse earning most or all of the pension income. Then then support it whole-heartedly. Witness the recent change re: pension splitting.

In general, the Liberals and NDP are against it (NDP were even against pension splitting) because it encourages one spouse to remain in the home - usually the wife - and this takes away her "freedom" to work.

[Remiel]

Why should working families support a tax that gives more to people that can afford to have a stay at home parent than to families who can't?

[Pat Coghlan]

Why should working families support a tax that gives more to people that can afford to have a stay at home parent than to families who can't?

Any family in which one spouse earns most or all of the family income would benefit, not just those with a stay-at-home parent.

Keep in mind that while two families with the same combined incomes can have tax liabilities which differ by up to $16,000, they qualify for identical amounts of benefits, regardless of who earned it.

The government uses family income when it is convenient, namely, when they can use it to deny benefits.

If the government wants to insist on taxing only individuals, then they should let each spouse qualify for 50% of available benefits, based entirely on his/her own income (which could be zero).

[Remiel]

Any family in which one spouse earns most or all of the family income would benefit, not just those with a stay-at-home parent.

Yes, and people should feel even better about supporting stay at home spouses who do not have kids at all?

[scribblet]

People are free to choose and make their own decisions about working or staying home.

Income splitting is not about keeping women at home etc. etc. , that is simply smoke and mirrors, most people would not save enough that they could afford to have one spouse stay home.

[Renegade]

On his blog, Garth is saying that he is going to push the Liberal party to extend income-splitting to all families, not just pensioners.

The whole issue of income-splitting is all about giving a targeted group a tax break. It has got nothing to do with "fairness". As a country we should decide whether we want the individual unit for measuring income to be the family or it shoudl be the individual. If we decide the family, then even singles should be free to decide who is included in their family.

[Pat Coghlan]

On his blog, Garth is saying that he is going to push the Liberal party to extend income-splitting to all families, not just pensioners.

The whole issue of income-splitting is all about giving a targeted group a tax break. It has got nothing to do with "fairness". As a country we should decide whether we want the individual unit for measuring income to be the family or it shoudl be the individual. If we decide the family, then even singles should be free to decide who is included in their family.

Well, the Carter Royal Commission looked at this in 1968 and concluded that it was the family that spent the money - not the individual - so the family should form the basic unit of taxation. The (Liberal) government of the day ignored the recommendations.

The government already uses family income as the basis for determining benefit eligibility (produces bigger number for clawbacks) but insists on taxing the individual...although this has changed in 2007 for retired couples. We should do the same for all families.

BTW, the government already has a definition for family (person, spouse, children). Two siblings living together are not a family.

[Renegade]

BTW, the government already has a definition for family (person, spouse, children). Two siblings living together are not a family.

Why use a restrictive definition of family? Why are two siblings living together not a family?

[Pat Coghlan]

BTW, the government already has a definition for family (person, spouse, children). Two siblings living together are not a family.

Why use a restrictive definition of family? Why are two siblings living together not a family?

You'd have to ask Revenue Canada or Finance, but a family is much more than co-habitating persons. A financial obligation must exist, as does between a husband/wife and their children. Are you saying you're prepared to be legally obligated to support a brother or sister and be declared a family?

Revenue Canada has defined the meaning of a family, BTW.

This is not "restrictive". The definition is pretty much universal around the planet.

[ScottSA]

Why should working families support a tax that gives more to people that can afford to have a stay at home parent than to families who can't?

First, it's not a tax, it's a tax cut; and second, it is simply giving a family with one income the same tax status as a family with two incomes.

[Pat Coghlan]

Why should working families support a tax that gives more to people that can afford to have a stay at home parent than to families who can't?

First, it's not a tax, it's a tax cut; and second, it is simply giving a family with one income the same tax status as a family with two incomes.

Actually, giving all families with the same income - regardless of the income split between the spouses (some families have two non-equivalent incomes) the same tax status/liability, in the same way that they currently have the same benefit status/eligibiliity.

Those who turn thumbs down on this concept should keep in mind that this change has been put in place for pensioners, with the pension-splitting changes introduced in the recent budget.

If it's the right thing to do for pensioners, it's the right thing to do for working families as well.

[ScottSA]

Why should working families support a tax that gives more to people that can afford to have a stay at home parent than to families who can't?

First, it's not a tax, it's a tax cut; and second, it is simply giving a family with one income the same tax status as a family with two incomes.

Actually, giving all families with the same income - regardless of the income split between the spouses (some families have two non-equivalent incomes) the same tax status/liability, in the same way that they currently have the same benefit status/eligibiliity.

Those who turn thumbs down on this concept should keep in mind that this change has been put in place for pensioners, with the pension-splitting changes introduced in the recent budget.

If it's the right thing to do for pensioners, it's the right thing to do for working families as well.

True enough...it gives an advantage to two income families where there is a disparity between the incomes as well. From the POV of the government however, it is without question a tax loss, which makes it in effect a tax cut.

[madmax]

The tax system itself is still suffering from the feminist hangover of trying to force women into the workplace, and that's both why it's being rolled back and a source of conflict from the "progressives" still stuck in the 80s.

Forcing women into the workplace was a big problem, like when they earned the right to vote or the right to drive a car. Sarcasm!!!

I bet it was troubling when those women went to work in factories while the men where fighting overseas. Some of them lost their husbands to fighting. And when the soldiers came back, alot of women where displaced from their jobs, or lost them after having children. Yes, those women, whom contributed to our society and wanted to be treated equally.

Regardless of income splitting, your comments are despicable.

[Renegade]

You'd have to ask Revenue Canada or Finance, but a family is much more than co-habitating persons.

Actually my question was not in the context of what the CCRA interprets. The CCRA has narrow interpretation guidelines and those guidelines are subject to change. For example the definition of spouse was extended to include same sex spouses. What we are discussing are changes to taxation policy so the determination of who it applies to, is also up for discussion.

A financial obligation must exist, as does between a husband/wife and their children. Are you saying you're prepared to be legally obligated to support a brother or sister and be declared a family?

Well I guess it depends what you mean by financial obligation. I understood the justification for using family income as the basis, was because there was shared income and shared costs, not because there was a mutual obligation. Two people who buy a house together also share a financial obligation. They may or may not pool their income, subject to their own arrangment. Two spouses may have pre-nuptial arrangments which separate their incomes and assets, and release each other from any financial obligation toward each other. I'm not seeing a clear connection of why there needs to be a mutual financial obligation in order to be entitled to a tax break.

Further, if I undertake to take on a financial obligation toward my destitute parents, does that mean, in your view, we qualify as a "family" are can now be taxed as one income unit?

Revenue Canada has defined the meaning of a family, BTW.

I don't dispute that. As I said we are talking about policy changes from what is currently defined.

The definition is pretty much universal around the planet.

Can you please point me to the universal definition of family? Our country has recently recognized same-sex spouses as family, many countries do not. Many religions practice polygamy and all spouses are recognized as part of the family. Some cutures have a communal lifestyle where all the commune is considered a family. Yet others consider aging parents who reside with them to be part of the family.

So I'd be very interested in the basis for your conclusion that there is a universal definition for family.

[Renegade]

Actually, giving all families with the same income - regardless of the income split between the spouses (some families have two non-equivalent incomes) the same tax status/liability, in the same way that they currently have the same benefit status/eligibiliity.

I have a better idea. How about we just add the two spouses income and then tax them at the same rate as individuals. That too would give all families with the same income the same tax status/liability.

Those who turn thumbs down on this concept should keep in mind that this change has been put in place for pensioners, with the pension-splitting changes introduced in the recent budget.

If it's the right thing to do for pensioners, it's the right thing to do for working families as well.

On this I agree. If it is the right concept it should be implemented across the board and not just targeted as a select group such as pensioners.

However, as proposed now it is simply a shift of the tax burden from couples to individuals.

[Pat Coghlan]

You'd have to ask Revenue Canada or Finance, but a family is much more than co-habitating persons.

Actually my question was not in the context of what the CCRA interprets. The CCRA has narrow interpretation guidelines and those guidelines are subject to change. For example the definition of spouse was extended to include same sex spouses. What we are discussing are changes to taxation policy so the determination of who it applies to, is also up for discussion.

To extend the definition, they had to change just about every law on the books.

If you want to fall under the same definition, and the government is willing to go through this global update again, okay. Otherwise, status quo.

A financial obligation must exist, as does between a husband/wife and their children. Are you saying you're prepared to be legally obligated to support a brother or sister and be declared a family?

Well I guess it depends what you mean by financial obligation. I understood the justification for using family income as the basis, was because there was shared income and shared costs, not because there was a mutual obligation. Two people who buy a house together also share a financial obligation. They may or may not pool their income, subject to their own arrangment. Two spouses may have pre-nuptial arrangments which separate their incomes and assets, and release each other from any financial obligation toward each other. I'm not seeing a clear connection of why there needs to be a mutual financial obligation in order to be entitled to a tax break.

Further, if I undertake to take on a financial obligation toward my destitute parents, does that mean, in your view, we qualify as a "family" are can now be taxed as one income unit?

See my comment above. I mean a legal obligation (spouse or child).

The definition is pretty much universal around the planet.

Can you please point me to the universal definition of family? Our country has recently recognized same-sex spouses as family, many countries do not. Many religions practice polygamy and all spouses are recognized as part of the family. Some cutures have a communal lifestyle where all the commune is considered a family. Yet others consider aging parents who reside with them to be part of the family.

So I'd be very interested in the basis for your conclusion that there is a universal definition for family.

I mean whatever legal financial support remains when members of a "family" are no longer living under the same roof.

[Pat Coghlan]

Actually, giving all families with the same income - regardless of the income split between the spouses (some families have two non-equivalent incomes) the same tax status/liability, in the same way that they currently have the same benefit status/eligibiliity.

I have a better idea. How about we just add the two spouses income and then tax them at the same rate as individuals. That too would give all families with the same income the same tax status/liability.

Those who turn thumbs down on this concept should keep in mind that this change has been put in place for pensioners, with the pension-splitting changes introduced in the recent budget.

If it's the right thing to do for pensioners, it's the right thing to do for working families as well.

On this I agree. If it is the right concept it should be implemented across the board and not just targeted as a select group such as pensioners.

However, as proposed now it is simply a shift of the tax burden from couples to individuals.

Adding incomes and taxing one spouse would ensure the other spouse never worked outside the home.

There is a surplus now and the change could be implemented simply by avoiding spending it all!

[Renegade]

To extend the definition, they had to change just about every law on the books.

If you want to fall under the same definition, and the government is willing to go through this global update again, okay. Otherwise, status quo.

The status quo also means no pooled income for tax purposes. If they want to stand by the principle of pooled income then they should undertake it fully not in half measures, desipite the extent of the change required.

I mean whatever legal financial support remains when members of a "family" are no longer living under the same roof.

Sorry, I'm not following you. I don't see the relevance of "living under the same roof".

[Renegade]

Adding incomes and taxing one spouse would ensure the other spouse never worked outside the home.

And is that good or bad? Is the aim to encourage a parent to stay with the kids? What is the aim?

There is a surplus now and the change could be implemented simply by avoiding spending it all!

If there is a surplus now, the question is why a portion of that surplus should be directed at a small subset of the taxpaying base. There are many other options other than making any change. For example it could be directed at a general rate cut, or debt reduction.

[Pat Coghlan]

To extend the definition, they had to change just about every law on the books.

If you want to fall under the same definition, and the government is willing to go through this global update again, okay. Otherwise, status quo.

The status quo also means no pooled income for tax purposes. If they want to stand by the principle of pooled income then they should undertake it fully not in half measures, desipite the extent of the change required.

I mean status quo for anyone who doesn't currently fall under CRA's defninition of a family

I mean whatever legal financial support remains when members of a "family" are no longer living under the same roof.

Sorry, I'm not following you. I don't see the relevance of "living under the same roof".

I mean that, the relationship between family members (for tax/support purposes) doesn't change when they are no longer living under the same roof. I am still responsible for my kids if my wife and I split up. Ditto for paying her alimony etc.

If you want to extend the current definition of a family, these are the kids of support obligations that must be entrenched in law.

If you're not on the hook to support someone, you can't expect to jointly file your tax return with that person.