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MP-Report

Canadians have low taxes

Canadians continue to have one of the lowest tax burdens

Some of our very first steps as a government were to lower taxes on middle-income Canadians and to redesign a more generous, tax free Canada Child Benefit (CCB) that is income tested to ensure it is focused on those who need it the most. 

Today, a typical middle-class family of four receives on average of about $2,000 more each year to help with the cost of raising children, saving for the future and contributing to the economy for the benefit of everyone.

It also means that Canadians continue to have one of the lowest tax burdens in the OECD.

An average, two-income household with two children now keeps nearly 85 per cent of their gross income, once the Canada Child Benefit is factored in, the lowest rate among G7 member countries.

For single-parent households with two children, or for families with two children where only one parent is working, the benefits are even more significant with those families keeping more than 98 per cent of what they earn. 

Why then does the opposition continue to repeat the claim that the average middle-class family is paying more in taxes?

As I have pointed out in this column before it is a claim borrowed from a Fraser Institute report that focused on the elimination of certain tax credits but failed to consider benefits like the CCB.

As noted by Rhys Kesselman, Canada Research Chair in Public Finance at Simon Fraser University:

“the combination of three provisions in 2015 inherited from the Conservative government (the Family Tax Cut, the child tax credit, and the Universal Child Care Benefit) were all replaced by the Liberal government in 2016 with the Canada Child Benefit, which distributed $2 billion more to families than the provisions that they replaced.”

Additionally, according to the Fraser Institute itself, it was families making over $150,000 who drew the biggest tax advantage under the previous Conservative Government’s Family Tax Cut, a tax cut that also yielded no benefits for single parents.

Not only does the CCB benefit all types of families, including single parent families, it is of greatest benefit to households with the lowest household income.

The CCB also ensures more financial support is provided to families up front, so they have the means to cover the costs of raising children, including the costs of fitness and arts programs, and saving for their education. 

In our riding, approximately 17,400 children are benefiting from the more generous CCB each month.

As we get closer to the election, dubious claims of higher taxes on average Canadians at the hands of this government will no doubt be repeated. 

But taxes remain low and targeted investments are working: the Canadian economy has been operating near capacity for over a year with the lowest debt to GDP ratio in the G7, job growth has been strong, the unemployment rate is at a 42-year low, and wages are rising.

While reductive political headlines and binary choices might force us to choose sides, they do not reflect the reality that more Canadians are better off now than they were only a few short years ago.





Send veterans a valentine

Canada Summer Jobs Deadline and Recognition for Veterans

Employers considering using the Canada Summer Jobs (CSJ) have until Jan. 25 to apply.

Following feedback from stakeholders last year, the government has also made the process easier.

Everything can be submitted online through the Government Grants and Contributions Online Service where employers can complete the application at their leisure and track its status once it has been submitted.

The government has also expanded eligibility to:

  • include all youth between the ages of 15-30 who are legally entitled to work in Canada – not just students
  • updated the eligibility criteria to set out more clearly what is and isn’t eligible for funding;
  • ensured better job matching by posting all positions on jobbank.gc.ca and the app to help match young people with employers.

CSJ funding is available for not-for-profit organizations and public and private sector employers with 50 or fewer employees. 

Non-profit organizations can receive up to 100 per cent of the provincial/territorial minimum hourly wage, as well as employment-related costs, while public-sector employers and small businesses can receive up to
50 per cent of the provincial/territorial minimum hourly wage.

In the last three years, with additional funding, our government has worked with local employers to double the number of CSJ jobs available in Kelowna-Lake Country.  

As many of you have expressed, it is a mutually beneficial experience, and I hope you will once again choose to participate to help our young people gain the skills and the confidence needed to find meaningful employment in today’s labour force.

More information on CSJ can be found at Canada.ca/Canada-summer-jobs, or by calling 1-800-935-5555.

Veterans

As we welcome our new minister of Veterans Affairs, Jody Wilson-Raybould, our government’s work to support Veterans continues.

Responding to a call for action by Canadian Armed Forces members, veterans, and the Veterans Ombudsman, our government has introduced the Veteran’s Service Card, which will be distributed to former and releasing Canadian Armed Forces (CAF) members who completed basic training and have been honorably released.

The new Veteran’s Service Card provides a tangible symbol of recognition for former members, encouraging an enduring affiliation with the CAF and ensuring linkages to VAC support programs as members transition to post-service life.

The new Veteran’s Service Card will be distributed in stages depending on when veterans were released from the Canadian Armed Forces.

More information can be found at canada.ca/veterans-service-card

Once again, Veterans Affairs Canada (VAC) is inviting Canadian schools, individuals and organizations to show their appreciation for Canadian Veterans by making valentines for Vets.

This program began in 1989 when columnist Ann Landers encouraged her readers to send valentines to veterans.

Since 1996, VAC has distributed the hand-made valentines to veterans in long-term care facilities across the country in recognition of the enduring service our veterans have provided to our country. 

More information on ways to participate in this program can be found at veterans.gc.ca.



2018 in Review

It’s hard to believe another year has come and gone — 2018 was a challenging year, but much was accomplished.

On the trade front, we defended Canada’s interests and concluded the Canada-U.S.-Mexico free trade agreement (NAFTA), safeguarding billions of dollars in daily trade, preserving important market access for Canadian products and continued growth on both sides of the border.

On Dec. 30, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) came into force providing Canada with significant export diversification opportunities, especially for our agriculture sector including new markets for Okanagan cherries.

Together with the Canada-European Union Comprehensive Economic and Trade Agreement (CETA), Canada is now the only G7 country with a free-trade agreement with every other G7 nation.

On the climate front, we managed to formalize a way forward after some provinces flip flopped on agreeing to price pollution despite all the evidence telling them to do so.

Canadians recognize what British Columbians have known since 2008  — that putting a price on pollution, with an emphasis on economic growth, is the way forward to effectively address the challenges associated with changes in our climate.

Despite the naysayers and a misinformation campaign about increased taxes and lower wages – Canadians pay one of the lowest tax burdens in the OECD and wages are rising – many, including Canada's largest business group, the Canadian Chamber of Commerce, have endorsed the price on pollution as the most efficient way for the country to cut greenhouse gas emissions.

As noted by the Chamber, if executed well, the policy has the potential to reduce the overall costs to business through the reduction of duplicative regulation and investment in innovation and technologies to reduce carbon emissions and energy costs.  

Combined with record job creation and the potential of more economic growth, we have entered 2019 in sound fiscal health, supported by a federal fiscal policy that Canada’s Parliamentary Budget Officer (PBO) says is sustainable over the long term. 

Closer to home, we continue to see prominent federal visibility with federal funding continuing to flow into our riding supporting the issues you told me were important to you. 

Examples include federal support for:

  • the Okanagan Rail Trail
  • the new Lake Country activity centre
  • Okanagan invasive species
  • UBCO and Okanagan College,
  • our tech sector
  • affordable housing and homelessness
  • continued support for multi-year infrastructure projects just to name a few. 

Supporting Canadian families continues to be a cornerstone of our government’s policies through:

  • our homelessness and poverty reduction strategies, the Canada Child Benefit, which was indexed this past July two years earlier than originally planned,
  • ongoing support for seniors and Veterans
  • an increase by nearly 50 per cent starting in 2019 to the Working Income Tax Benefit, which provides cash payments to working Canadians with very low incomes. This will give more support to those who need it most.

There is no doubt that 2019 will be an important year for all of us and that our vigilance in support of truth, democracy, and equality, and a belief in our ability to innovate and work hard to maintain our quality of life is more important than ever. 

I wish you all a very Happy New Year and I thank you for your support as we continue to make our community, and country, the very best it can be.



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Good for business

Canada’s current economic strength is a reflection of the successful efforts of Canadians to build an economy that works for everyone.

With one of the fastest growing economies in the G7, Canadians have created more than 550,000 new full-time jobs, pushing the unemployment rate to a 40-year low. 

In addition, wage growth is outpacing inflation and after-tax profitability of businesses is leading to stronger consumer confidence and positive conditions for investment.

This is good news at a time when concerns about U.S. tax reform have left many wondering if Canada can remain competitive and continue to attract investment.

The Fall Economic Statement delivered by the government on Nov.21 should put these concerns to rest.

The measures introduced in the Fall Economic Statement will ensure that Canada maintains a tax advantage in attracting new investments.

The average overall tax rate in Canada on new business investment — as measured by the Marginal Effective Tax Rate (METR) — will fall from 17 per cent to 13.8 per cent.

This will give businesses in Canada the lowest overall tax rate on new business investment in the G7, significantly lower than that of the United States.

Furthermore, new proposed tax measures for business will provide focused, fiscally responsible support for growth-generating investments in Canada, while continuing to keep the debt-to-GDP (gross domestic product) ratio low and on a downward track.

Specifically, three immediate changes to Canada's tax system are designed to enhance business confidence and encourage more job-creating investments:

Allowing businesses to immediately write off the full cost of machinery and equipment used for the manufacturing or processing of goods will spur new investments, and support the adoption of advanced technologies and processes in this highly mobile sector.

Allowing businesses to immediately write off the full cost of specified clean energy equipment  will encourage new investments and the adoption of advanced clean technologies in the Canadian economy.

And introducing the Accelerated Investment Incentive will allow businesses of all sizes and in all sectors of the economy to write off a larger share of the cost of newly acquired assets in the year the investment is made. 

Already the feedback has been positive.  

The Canadian Federation of Independent Business said the measures in the Fall Economic Statement will make it easier for business owners to invest and further, that they welcome the government’s commitments to reduce red tape and to break down internal trade barriers.

Perrin Beatty, president and CEO of the Canadian Chamber of Commerce, noted that faster write-offs for new investment, regulatory reform and concrete actions to accelerate the removal of barriers to trade within Canada are all important steps in the right direction.

With additional measures that include:

  • reducing the small business tax rate to nine per cent on Jan. 1
  • increasing the Strategic Innovation Fund
  • supporting export diversification
  • creating a Social Finance Fund that gives charitable, non-profit and social purpose organizations access to new financing.

With those changes, the government is building on a strong economic environment and encouraging an even stronger investment climate.

Prevailing economic winds are inevitable whether the result of changing global political realities or rapid technological change. 

By keeping business and personal taxes low, addressing our social needs, and supporting an economy that continues to create good jobs to support families, our government is doing all it can to build resiliency and maintain confidence in the Canadian economy.



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About the Author

Stephen Fuhr was born in Edmonton, AB and grew up in Kamloops, BC. He is a former CF-18 fighter pilot with the Canadian Air Force.

After serving with distinction for 20 years, Stephen retired from the Canadian Forces in 2009 with the rank of Major. He joined his family’s Kelowna-based company, SkyTrac Systems, which develops aviation communication and tracking equipment. As CEO and Director of Business Development, he led the company to financial success in a challenging economic climate.

In 2012, Stephen left the company to pursue his first love of flying.

With growing interest in politics and a desire to serve his country again, Stephen ran for office in the 2015 election.

Today, he proudly serves as the Member of Parliament for the Kelowna-Lake Country riding. 



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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