(February 24 – 16:35 ET) – It’s not Christmas, but since the federal budget speech is approaching, it is wish list time for the Canadian Institute of Chartered Accountants.
Please, Mr. Martin, eradicate bracket creep, asks the CICA.That wish tops their list. Although it’s all in favour of debt reduction, the CICA would like to see the Minister of Finance end bracket creep by restoring full indexation, eliminating the five-per-cent surtax, and cutting the middle income tax rate from 26% to 24%.
The CICA estimates a $10 billion surplus for fiscal 2000-2001. It would like to see $5 billion spent on debt reduction, $3.5 billion on tax cuts and $1.5 billion in new spending.
Ending bracket creep is the top priority.
“Every year Canadians are forced to pay higher taxes because of bracket creep,” says Roger Ashton of the CICA Taxation Committee. “This surreptitious and automatic tax takes an extra $10 billion out of taxpayers’ pockets each year. It’s a gold mine of a tax for the federal coffers and it must be eliminated.”
The CICA argues the surtax should be dropped because it was introduced as a temporary deficit reduction measure, and with the deficit gone, the surtax should disappear too it argues.
The cut for middle-income earners would save about $2.2 billion in tax it estimates. Overall the CICA says that tax cuts will boost GDP and employment, and would be sustainable over time, while also allowing room for debt reduction.
“The time has come for the federal government to introduce a budget which includes a plan to pay down the national debt and a comprehensive package of personal income tax cuts based on the principles of fairness and sustainability,” says Ashton. “Such a budget would not only benefit all Canadians but would also stimulate the Canadian economy, creating significant, positive results.”
-IE Staff