The Income War Tax Act was introduced in 1917 as a temporary measure to help pay for Canada's efforts to defeat Germany in the first World War.

Although federal income tax ended up as a permanent scourge on workers, the basic exemption in 1917 was remarkably generous. A person without dependent children did not pay the 4% rate on the first $1,500 earned.

The Bank of Canada's inflation calculator tells us that $1,500 in 1917 is the same as $18,963 in today's dollars.

Compare $18,963 to today's federal income tax exemption of just $7,634.

Earn one dollar more, and Ottawa will take 16 cents of it. And that's the lowest rate in 2002 - four times as high as in 1917.

Earn more than $31,677 in 2002, and Ottawa starts taking 22 cents of each dollar over this amount.

And if you are among the "rich" earning more than $63,354 in 2002, Ottawa takes 26 cents of every dollar you earn over this amount. For the "filthy rich" who earn more than $103,000 in 2002, Ottawa takes 29 cents of every dollar over this amount. Once Ottawa has satisfied its appetite, the provinces come along to take even more money away from families.

But back to the basic exemption of $7,634 - a fraction of what it was in 1917.

Is it unreasonable to allow people to keep enough of their own money to provide a basic standard of living for themselves?

Why won't Ottawa leave working Canadians with enough of their own money to pay for food, clothing and shelter?

Can you share an apartment with room-mates, drive a cheap car, pay for insurance and other bills, and buy your groceries for under $1,000 per month?

Perhaps some people can. But what about clothing, charitable giving, car payments, student loan repayment, entertainment, and saving for a rainy day?

Wouldn't an income tax exemption of $1,500 per month be more fair? That's what the basic personal exemption was in 1917: $18,963 per year (in 2002 dollars) or $1,580 per month.

A person needs $1,000 to $1,500 per month to enjoy a very basic standard of living. But Ottawa is determined to wage war against the poor, taking money away from people who earn as little as $650 per month.

For families with children the situation is even worse.

When this "temporary" tax was imposed in 1917, families with children did not pay the 4% income tax on the first $3,000 earned, which is the same as $37,926 today. If two parents earn $37,926 in 2002 to support themselves and their children, they already pay GST, fuel tax, corporate tax (indirectly), property tax and $1,056 in Alberta health care premiums. Must this family pay income tax as well? Yes!

Worse, this family must pay higher taxes if one parent cares for children full-time. If one parent earns $50,000 and the other parent works at home and cares for children, that family must pay more federal income tax than a family in which each parent earns $25,000.

Despite the vast quantity of pro-child rhetoric you hear from politicians, Ottawa punishes parents who choose to spend more time with their children.

As a first step towards ending its war on the poor, Ottawa should follow Alberta's example and raise the personal income tax exemption to $13,339.

This falls short of the $18,963 exemption enjoyed by Canadians in 1917, but is a lot fairer than today's paltry $7,634.

Next, Ottawa should follow Alberta's example and start respecting the child care choices of parents. A family in which one parent earns $60,000 and the other parent does not earn a salary should not have to pay more federal income tax than another family in which mom and dad earn $30,000 each.

In contrast to the federal system, Alberta's provincial income tax system does not discriminate between two families with the same income.

Can Ottawa afford to stop attacking the working poor? Yes and easily, if it stops giving billions of our tax dollars each year to businesses (many of them profitable) in the name of "regional development" and "economic diversification."

Ending this expensive failure of corporate welfare would free up billions of dollars immediately. Left in the hands of the Canadians who earned them, these billions of dollars would spur investment and consumer spending.

In an over-taxed country like Canada, the resulting economic growth would lead to more tax revenues for government, as tax cuts often do. More important, low income earners would regain the dignity and self-respect that comes from being able to support themselves with a basic standard of living.

As long as governments continue taking a portion of our income, they should allow Canadians a standard of living exemption.

If the state insists on taxing families, it should fully respect parents' choices about child care.