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2016 Federal Budget©

A preview of the 2016 federal budget under the Liberal government

On 22 March 2016, the Minister of Finance, Honourable William Francis Morneau tabled the Liberal government's first budget (hereinafter known as the Budget) after winning the last federal election. The following are not an exhaustive list of changes proposed by the Budget.

Selected Personal Tax Changes

Selected Business Tax Changes

Other Changes

The Budget contains many changes in tax measures that affect most Canadians and marks a new era under a majority Liberal government. Unlike the Conversatives who advocate balanced budget, the Liberals tabled a deficit budget to fulfill their pre-election promises. The deficit ballooned from the previously expected $10 billion to $18.4 billion in 2016-17, almost twice as much.

The Liberal government alleged that the Budget is a goodwill gesture to improve relationship with the First Nation. Increased funding will improve Aboriginal housing, education and water quality. On the environmental front, it provided tax break (like accelerated CCA for electric vehicle charging stations and electrical energy storage properties) to help build a green economy. It also allocated $125 billion to public transit and social infrastructure (such as child care spaces and community centres).

Age eligibility for Old Age Security (OAS) was lowered to 65 from 67 and the guaranteed income supplement (GIS) for single low-income seniors was increased by 10%.

Furthermore, the Budget provided support to the CRA to: Remarks

The Budget will no doubt please some voters. However, the deficit and the resulting national debts to finance the proposed government spendings could have an adverse impact on the Canadian economy. In view of our aging population, lowering OAS age eligibility may eventually backfire, rendering Canada's largest pension program less robust. In short, the Budget will increase financial burden on future generations.

The Budget emphasized that government spendings focus on the middle class. However, replacing education and textbook tax credits by student loan grants that only low-income students qualify will likely raise the financial burden on many middle class families with children receiving post secondary education. The impact will also be determined by the eligibilities of the grants, which remain unclear at the point of writing.

Loopholes closed by the new tax measures suggested that the Budget targeted wealthy astute taxpayers to eliminate their tax saving opportunities.

Insofar as improving wellbeing of the indigenous people, more funding could harm more than help. First and foremost, federal subsidies on state-sponsored child removal from First Nation families contribute to the over representation of Aboriginal children in foster care. In many cases, child protection agencies of provincial governments appear to have used native children as tool to get transfer payments under the pretext of child protection.

In our opinion, a better goodwill gesture is to eliminate child removal related financial incentives, such as federal subsidies and Children's Special Allowances
Pursuant to the Children’s Special Allowances Act (1992, c. 48, Sch.), CSA is an enticing financial incentive. CSA payments are in 9-digit figures and are rising every year
(CSA, a tax-free monthly federal payment made to service providers of the child protection industry such as agencies, institutions and foster parents who are responsible for the care and education of children under 18 who physically reside in Canada and who are not in the care of their parents). Since all Indians under the Indian Act qualify for the new tax-free Canada Child Benefit proposed in the Budget, this new benefit may become money that could be seized by child protection agencies or foster parents after First Nation children are removed. Elimination of these incentives will not only reduce the budget deficit but will also mitigate costs to deal with the huge social problems created by state-sponsored child removal.

There are compelling reasons to believe that modern child protection is a derivative of the now renounced residential school system. Empirical evidence suggests that Native foster children reached 27,000 in 2006 and surpassed the number of children removed during the height of the residential school era. Both residential schools and modern child protection involve state-sponsored child removal, which is a powerful tool of cultural assimilation that could be used for political purposes under the pretext of child welfare.

"The people have always some champion whom they set over them and nurse into greatness...
This and no other is the root from which a tyrant springs, when he first appears he is a protector."
(Plato, 429-347 B.C., Source: The Republic)

[This page was added on 23 March 2016, last revised 24 March 2016.]