The awesome fireworks displays around the world on New Year's Eve were a celebration of western civilization's march of progress. After 2000 years, we have much to be thankful for, particularly in Canada. The march toward tax relief however has not kept pace with expectations.

On January 1, 2000 some federal and provincial taxes are going down while others are going up and taxpayers can only hope it doesn't cost them too much (read: accounting fees) to make sense of it all come tax time this spring.

The Good (Sort of)

On a personal level, some small tax relief kicks in on January 1. The provincial income tax rate drops from 48.5 to 47 percent of the federal tax payable, as scheduled in the Tory's last budget. That means a $30,000 income earner can expect to save another $55 over last year.

In the 1999 federal budget, the basic personal exemption (BPE) was raised by $675 from $6,456 to $7,131. The spousal and equivalent-to-spouse credit amounts also rise by $675 on January 1 with the full exemption of $6,055 available to taxpayers for the 2000 taxation year.

While these increases may seem generous, taxpayers should keep in mind that the BPE remained unchanged since 1992 until last February's budget. In other words, the federal government really hasn't even played catch-up for inflation since 1992. An increase of $820 would have been needed to do this, instead of the $675 that was provided.

Other targeted measures for seniors, including OAS, GIS and CPP top-ups also take effect on January 1. But our seniors shouldn't jump for joy anytime soon. For example, the maximum CPP and OAS payments are increasing by $135 and $90 respectively. Wow, a whopping $225 annual increase for seniors, many of who already live below the poverty line.

It works out to paltry 61.6 cents/day. It seems that the billions of dollars we still spend on corporate welfare and the $143 million given to communities to celebrate the Millennium were more important activities than taking care of some of the most needy in Canada.

The Bad (Payroll rip-off)

While Canadians earning $39,000 or above can expect the maximum Employment Insurance (EI) premium reduction of $58.50 to take effect in the New Year, they better not put the money in the bank. While EI taxes are down, this same $39,000 worker will pay an extra $143.40 in Canada Pension Plan (CPP) premiums on January 1st. The net effect, an $84.90 increase in payroll taxes for Canadian workers.

And employers don't fare much better. When EI decreases and CPP increases are factored together, your boss is on the hook for an extra $61.50 for you and each of your colleagues in the office.

Let's not forget the tape tax, er excuse me, tape levy. On December 17th the Copyright Board announced new levies on blank recording media. At the end of the day (assuming tape manufacturers pass this levy onto consumers, which they no doubt will) a 40-minute (or longer) cassette tape will cost you an extra 23.3 cents and recordable CD media as much as 61 cents more.

On balance, taxpayers are no further ahead in 2000. Extra income taxes collected through bracket creep out strip any savings from base rate income tax cuts. Rising payroll taxes and industry specific taxes like the tape tax and a recently proposed cinema tax for Winnipeg (generously passed on to the consumer) make any celebrations of recent tax relief in 2000 a dubious occasion. Get on the horn and tell your MLA and MP that Canadians will not be fooled by token tax cuts.