Mr. Speaker, today I would like to talk about the big vision that millions of Canadians will be able to carry out in their own lives as a result of the tax relief that would permit them and empower them to make decisions about their own futures.
Let me set the context for the conversation about taxes and families from the outset. Before I can talk about the Prime Minister's family tax cut yesterday, or his increase in the annual child care payments that he announced less than 24 hours ago, it is important for me to discuss where he started off.
Prior to that announcement, this government had already cut taxes 160 times.One million Canadians had been removed from the tax rolls as a result of the government's decision to raise the amount of money that people can earn before federal taxes kick in at all.
The government increased the amount that families in the lowest personal income brackets could earn before paying taxes. As a result, 380,000 seniors no longer pay any taxes to the federal government. That is in addition to targeted tax breaks for bus passes, children's sports, and students' textbooks. It is in addition to the elimination of all taxation on scholarships for hard-working, high-achieving young people who are rewarded for their academic achievement.
That was the status of our tax changes prior to yesterday.
What were the results at the end of the line for the Canadian taxpayers? What did it mean for families? The median net worth of Canadian families had increased by 45%. For the first time, and this is according to The New York Times, middle-income Canadians are better off than Americans. As well, prior to yesterday, the average Canadian family paid $3,400 less in taxation.
The Parliamentary Budget Officer, often a critic of the government, acknowledged that this tax relief had actually been targeted at low- and middle-income families. He said, “Cumulative tax changes since 2005”—which is when this government took office—“have been progressive overall” and most greatly impacted low-middle income earners, meaning households earning between $12,000 and $23,000, effectively resulting in a 4% increase in their after-tax income.
The Parliamentary Budget Officer also said:
In total, cumulative changes have reduced federal tax revenue by $30 billion, or 12 per cent. These changes have been progressive, overall. Low and middle income earners have benefited more, in relative terms, than higher income earners.
As a result, real after-tax disposable income has increased by 10% since 2006.
I will return to quoting The New York Times article on the very question:
After-tax middle-class incomes in Canada—substantially behind in 2000 — now appear to be higher than in the United States.
Often we ask ourselves how the lowest-income earners among us are faring in this society of ours. How are they doing, particularly during the aftermath of the global recession that struck so terribly all around the world not so long ago? We can ask UNICEF, which studied the matter and concluded that Canada's child poverty rate decreased during the recession, pulling 180,000 children out of poverty.
UNICEF's president said that the report attributes the decrease in Canada to initiatives by both the federal and provincial governments, such as Ottawa’s National Child Benefit supplement, which gives monthly payments and benefits to low-income families with children.
He said, “[These benefits] kept money in circulation. ... Money goes to poorer families, and that tends to be spent on children, and then it kept money circulating in the economy as well. That kind of investment in children is so important.”
In other words, when we brought in the universal child care benefit, the $1,200 a year we send to every family per child under six, the opposition said that it was only going to help the rich. UNICEF now says precisely the opposite. It says that people who were most in need benefited the most.
NDP members get very angry when our free enterprise policies lift people out of poverty, because it takes away their arguments to control people's lives with big, costly, bureaucratic government programs. They want more of the problem so that they can declare themselves to be the solution. We understand that Canadian families are the solution. We understand that the best social program is a strong family and the best anti-poverty program is a good job.
There is good news on that front as well. There are one million net new jobs in Canada since the depths of the recession. That is the best job creation record of any of the G7 countries.
What is it doing to our nation's books? Are we drowning in deficit and debt like the entire European continent and the states to the south of our border? Are we facing the kinds of downgrades that, for example, the Liberal government in Ontario faces? The answer is no. We are on track to balancing the budget in this coming year. In fact, according to all the experts, our budget is in even better shape than promised by our government originally.
To whom does that future surplus belong? It does not belong to the politicians who want to spend it on behalf of Canadians; it belongs to the hard-working men and women who pay the bills.
Luckily for them, our government will give it back. We will allow them to keep that money so that they can invest in their communities, raise their families, and help create local jobs.
That brings me to yesterday's announcement.
Yesterday the Prime Minister announced three things. First, he would increase the universal child care benefit from $1,200 a year to just about $2,000 per year per child. Second, no longer would that benefit be restricted to families with kids under six. All children would qualify for the universal child care benefit, and every child six or over would be entitled to receive $720 per year.
Just as an example, the universal child care benefit for a middle-income family with a stay-at-home parent and two kids will be worth $4,000 per year. Those are important dollars that they can invest in raising their children, whether through a stay-at-home parent who works hard to keep the home strong and the kids healthy and active or through a daycare like the one I was raised in during my early years as a child in Calgary. The reality is that we are giving the choice to parents, which brings me to the next item in the proposal.
Families will be allowed to share their income. The spouse with the higher income will be allowed to give up to $50,000 to the one with the lower income to save up to $2,000 per year on taxes.
Finally, the amount of money that families can claim in child care expenses such as daycare will go up by $1,000. Whether a parent chooses daycare or a stay-at-home option or something in between, the money will go into the pockets of parents. There are millions of child care experts in this country, and their names are mom and dad.
Parents, not politicians, should decide how to raise children, and that is the fundamental debate in this country. I appreciate that the other side wants big, unionized, institutional, one-size-fits-all daycare, but on this side we trust parents, and our tax cuts allow them to make their own decisions.
