When Parliament resumes on Monday, serious pundits will yawn as they wait for his inevitableness, Paul Martin, to win the Liberal leadership and transition power from Jean Chrétien later this fall and over the Christmas break. Polls indicate Canadians want to see this transition ASAP.

Meanwhile in our fair city, an army of policy wonks is beavering away in lobbyists' offices and every bureaucratic nook and cranny preparing Mr. Martin's "transformative" agenda. Yet details of further plans for broad based personal income tax relief will be conspicuously absent from this agenda.

While the short term outlook for budget surpluses is tenuous due to the "perfect summer storm" of SARS, mad-cow disease and a higher dollar, longer term forecasts are still relatively bullish and it is reasonable to expect that annual surpluses of over-taxation will average $5 billion or more over the next half decade.

The capacity for the feds to implement future tax relief is very real and sustainable. But the political consideration is to weigh the desire for tax relief on one hand versus the inherent Liberal appetite for more social spending on the other. However, the more worthy option - both fiscally and socially - is to pursue further income tax relief through an increase in the basic personal exemption (BPE) from its current level of $7,756 to a target of at least $15,000 over the next five years.

Why $15,000? Simply put, $15,000 is equivalent to the average amount earned (before taxes) by minimum wage employees. So why does the federal government tax folks who are just entering the workforce, considered working poor, or just looking to earn a few extra bucks to make ends meet?

The importance of this question is axiomatic when one considers that we recycle a good deal of the taxes paid by minimum wage workers back to them in the form of GST credits and entitlement benefit schemes. This is unproductive and patently absurd.

Instead of taxing half their earnings (at a 16% rate) and creating jobs for CCRA and HRDC bureaucrats to recycle this money back to lower income Canadians in the form of monthly or quarterly benefit cheques, why not simply raise the BPE and leave more - if not all - of this money permanently on the paycheques and in their pockets of lower income Canadians so they can have the dignity of better providing for their families on a daily, weekly and monthly basis?

We don't need new or more generous income redistribution schemes. Instead, we deserve tax policy and a tax system that respects the value of hard work - especially that of lower-income Canadians - and affirms this respect by letting them keep more of their own money to begin with.

My calculations estimate the cost of raising the BPE to $8,000 at $602 million and if the spousal exemption (currently at $6,586) is also increased to $8,000, it amounts to a $1.3 billion tax cut. Raising the BPE to $10,000 tallies $5.5 billion and combined with an equivalent increase in the spousal exemption results in a $7.2 billion tax cut - permanently removing over 585,000 Canadians from the tax rolls.

Getting to the target amount of $15,000 amounts to a $17.8 billion tax cut or $22 billion if the spousal exemption climbs to $15K as well. It would remove 2.1 million Canadians (of 15.4 million taxpayers) from the tax rolls. Over five years, it should be child's play to cut taxes by $4.4 billion annually - on a base spending envelope of $140 billion plus forecast surpluses - and raise the BPE to $15,000.

From a fiscal perspective, this is entirely affordable. From a social policy perspective, providing tax relief for all taxpayers but most specifically lower-income Canadians is a slam dunk. It would be similar to the federal government's move to re-index the tax system to inflation in 2000 - after a nation-wide campaign led by the CTF - thereby ending bracket creep.

Good fiscal policy combined with great social policy makes for a winning political formula. Raising the BPE and spousal exemption is not so much a question of IF the government can do it; it is rightfully a question of WHEN the feds will do it? Paul Martin's legion of policy gurus - not to mention his 43 Finance Ministers in waiting - should take note.