$100 Billion Jackpot
Finance Minister Paul Martin hit the jackpot with a forecasted five-year $100 billion federal surplus (read over-taxation). Not unlike many Lotto 649 multi-millionaires, Mr. Martin is stumped on what to do with the booty - go on a spending spree or pay back a debt to taxpayers and creditors.
All we know is that we can expect some unspecified tax cuts, debt relief and more spending. The important questions are what tax cuts How much debt relief How much more spending Questions that will have to wait until the millennium budget.
One thing is for certain that after 2000 years taxpayers deserve a break. But some politicians on Parliament Hill are too divorced from reality to notice or care. In reference to Canada's high tax regime, Prime Minister Jean Chretien recently said that Canadians with higher-than-average incomes should lump it or leave it.
Earth to Mr. Chretien: taxes are still rising and high taxes do not make for happy campers.
Despite the microscopic 15 cent cut to EI premiums, the 40 cent hike in CPP premiums leaves a $39,000 income-earner with an overall $85 payroll tax increase over last year.
To make matters worse, bracket creep continues to erode taxpayers' purchasing power. The feds will make a clean $10 billion in extra personal income taxes in 1999 on account of bracket creep while the provinces net over $2.5 billion.
What effect does bracket creep have on taxpayers you ask Well, a $40,000 income-earner will pay $1,324 in extra income taxes in 1999 alone. Between 1989 and 1999, the same individual will have paid $9,418 in extra income taxes to federal and provincial coffers.
All told, Canadians on average hand over half of their income in taxes. Even during the darkest days of feudalism surfs were forced to give only a quarter of their output to their overlords. One wonders if it was better spent back then as well.
To stiffen his resolve to do battle with the defenders of high taxes and bracket creep, Mr. Martin needs some gentle persuasion.
Taxpayers can put Mr. Martin's feet to the fire by joining the "billion byte march" by signing the CTF's on-line tax cut petition.
The CTF has a plan to take $9.2 billion a year from the clutches of Ottawa and restore it back in the hands of taxpayers through specific tax relief measures:
eliminate bracket creep by indexing the tax brackets and credits to inflation;
eliminate the 5% federal surtax; and,
provide a 10% across-the-board income tax cut by lowering the 17, 26 and 29% federal tax brackets to 15, 24 and 27%.
By declaring war on Ottawa's lethal taxes, Mr. Martin would send a strong signal that the new millenium belongs to Canadian families and taxpayers first and foremost.