A Toronto-based Liberal candidate in the current federal election campaign says the Conservatives’ plan for income splitting won’t serve family needs.
Income splitting is a tax incentive introduced in the Conservatives’ 2011 platform. It is commonly referred to as income sharing or the Family Tax Cut.
Carolyn Bennett, the Liberal candidate and incumbent for St. Paul’s riding in Toronto, spoke about the issue.
“Critics of income splitting actually do see it as social engineering, trying to persuade one parent to stay at home,” Bennett said. “I think we do want people to have choices, but in my experience lots of people are struggling with two full-time salaries.”
Maureen Harquail, the Conservative candidate for St. Paul’s, explained how income splitting works.
“(It) will … allow families to share up to $50,000 of their household income … It will provide significant relief for almost 1.8 million families and they will ultimately save an average $1,300 per year,” Harquail said.
The Conservatives have said if they form the next government, they will introduce the Family Tax Cut once the budget has been balanced. Bennett noted that while income splitting gives families the choice of whether or not they would like one parent to stay at home, she feels that it’s simply not worth the forgone revenue.
“It’s quite clearly an issue of tax fairness,” Bennett said. “It is absolutely correct that two people earning the same amount of money will pay less tax than if it’s one person earning the same amount of money.”
She compared the proposed Family Tax Cut to the Fitness Tax Credit. Initially, Bennett had been a supporter of the Fitness Tax Credit. However, when she realized how much revenue would be lost, she changed her mind. She feels that the revenue would be better spent on activity infrastructure.
Harquail emphasized the importance of Conservatives’ plan in a post-recession era.
“It allows families to make the choices that best meet their own needs,” she said.