Good morning, Mr. Chair and committee.
My name is Aaron Wudrick, and I'm the federal director of the Canadian Taxpayers Federation. Thank you for the opportunity to appear today to speak to part 2 of Bill C-59, the provisions of which the CTF is generally supportive.
CTF is a federally incorporated not-for-profit citizens group founded in 1990 and with over 84,000 supporters. We are dedicated to three key principles, those being lower taxes, less waste, and accountable government. Perhaps unsurprisingly we appear today largely pursuant to that first principle of lower taxes.
I did want to take a very brief moment to commend the government on balancing the budget this year. We at the CTF have been very critical of the many years of deficits, so we only feel that it's fair to also give credit where it's due and applaud the government for having the discipline to get back to balance. We do wish it had done so at a lower level of spending, but we're content to leave that debate for another day.
With respect to the measures in part 2 of Bill C-59, first is the increase in the child care expense deduction. We are strongly in favour of this measure. lndeed, we proposed an even greater increase in the deduction last fall. We also believe the government should consider modifying this deduction to allow a parent to pay a stay-at-home partner and claim that deduction in the same way.
With respect to income splitting, one of the CTF's guiding taxation principles is advocating for broad-based tax cuts. Our first preference is always cuts to the general tax rates so all Canadians who earn income can benefit. That being said, income splitting is not a terrible second best. What it adds in complexity—and as very diligent observers of the ever-expanding size of our tax code, I can assure you it is already very complex—it compensates for in equity.
We believe it is entirely reasonable to ensure the tax codes treat like as like, and a household that, for example, earns $80,000 a year should not pay vastly different amounts of tax depending on how that earning is divided up among spouses.
This government first introduced income splitting for seniors and has now done so for families. We would hope the next objective would be to introduce income splitting for everyone else in order to broaden the benefits of such a policy, including possible provision for single persons to split income with dependants in certain circumstances.
With respect to the universal child care benefit, it is again no secret we at the CTF prefer tax relief instead of entitlement programs. Taxing citizens and then returning the money with a bow-wrapped cheque courtesy of the Government of Canada is not our preferred model. Having said that, we are in agreement with the government that parental choice is paramount, and putting money back into the hands of parents to spend on the form of child care that works best for them is better than a policy of creating, as some have proposed, a large government-run day care system.
In summary, with the caveats we've already identified, we are generally supportive of the provisions contained in part 2 of Bill C-59. While we will never stop pointing out that complex boutique measures clutter up the tax code, raise administrative costs, and generally confuse Canadians when not necessary, the fact remains overall the federal tax burden faced by Canadians continues to go down, and we welcome that development.
Thank you. I'm happy to take any questions.