Conservative Leader Pierre Poilievre says he will introduce an income tax cut that will save the average worker about $900 a year if he becomes prime minister.
Measure would see income up to $57,375 taxed at 12.75% from current rate of 15%
Peter Zimonjic · CBC News
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Conservative Leader Pierre Poilievre says he will introduce an income tax cut that will save the average worker about $900 a year if he becomes prime minister.
“We know that tax cuts create jobs and that will help build Canada’s economic fortress against American threats,” Poilievre said in a video on social media launching the measure.
The Conservatives say that they will cut the rate of tax on the lowest tax bracket from 15 per cent to 12.75 per cent, which will cut taxes individuals pay by about $900 a year, or $1,800 per two-income family.
According to the party, the measure will cost $7 billion a year for the first two years. When the measure is fully implemented in 2027-28 the cut will cost $14 billion a year.
In the video launching the measure, the Conservative leader said his government would pay for this by eliminating government waste and cutting the federal bureaucracy.
“Because we are cutting the lowest bracket, every single Canadian who pays income tax will pay less,” Poilievre said in Brampton, Ont., Monday. “Modest-income people will pay less in relative terms and as a share of their overall income.”
Poilievre said the details of how the tax cut will be paid for will be provided later in the Conservatives’ “costed platform.”
WATCH | Poilievre asked about tax cut plan, paying for campaign pledges
Poilievre asked about tax cut plan, paying for campaign pledges
Conservative Leader Pierre Poilievre on Monday announced his plan for an income tax cut that his party says would save the average worker about $900 a year. In response to a reporter’s question about the cost of his campaign promises, Poilievre said his government would cut bureaucracy, consultants, foreign aid and ‘handouts to insiders.’
The Conservative leader said his government will bring in a dollar-for-dollar law requiring ministers to cut spending by a dollar before they spend a dollar.
Conservatives will cut programs: Carney
Poilievre’s measure, which represents about a 15 per cent cut in the amount of tax paid in the lowest tax bracket, comes a day after Liberal Leader Mark Carney pledged to cut the bottom rate by one percentage point, a 6.6 per cent cut to the amount of tax paid in the lowest tax bracket.
Carney’s proposed tax cut would save someone earning at least $57,375, the ceiling of the lowest tax bracket, a little over $400 a year, or about $800 for a dual-income family. The first $16,129 a person earns is exempt from tax.
Carney’s proposed Liberal tax cut would cost $5.9 billion, according to the Parliamentary Budget Office’s Ready Reckoner calculator.
The Liberal leader says he will not pay for his income tax cut by reducing transfers to provinces or individuals, or by eliminating programs like pharmacare, child care and dental care. Instead, he said he will cut the growth of government spending each year and review programs for efficiencies.
Carney said government spending currently rises by about nine per cent a year, and he will reduce that, which he says will significantly alter the country’s “fiscal arithmetic.” The Liberal leader says those cuts will be made possible by focusing on the results of programs and ensuring the outcomes are reflecting “best value for money.”
Carney criticized Poilievre’s dollar-for-dollar plan to fund the Conservative income tax cut by suggesting it will lead to the elimination of child care, pharmacare and dental care.
“And even by cutting those programs, which he has committed to cut, he can’t pay for what he announced today,” Carney said in Gander, N.L.
Poilievre has not specifically said whether he would keep or cut the dental care, pharmacare and child-care programs, which when combined cost the federal government about $11.4 billion, according to the Parliamentary Budget Office (PBO).
The PBO says that by 2027-28, the same year the Conservatives’ 2.25 per cent income tax cut on the lowest tax bracket would be fully implemented, the cost of the dental program will be $1.75 billion and the cost of pharmacare will be about $400 million.
Using the year 2025-26, the last date the PBO uses in its calculations, the cost of the child-care plan will be about $9.2 billion.
Singh slams ‘millionaire tax cut plan’
NDP Leader Jagmeet Singh criticized both the Liberal and the Conservative proposals, calling them “tax cuts for millionaires.”
“Both of their plans for tax cuts for millionaires are exactly that, they are plans that help out millionaires more than they help out families,” Singh said in Montreal.
The NDP leader said the problem with the proposed income tax cut is that it reduces the tax paid on all income in the first tax bracket, which gives someone earning $57,375 the same tax reduction as it gives someone much more.
“Is it reasonable to propose a measure that gives the same amount of money to someone who earns $500,000,” as it is to someone who earns one-tenth of that, Singh asked?
The NDP leader said his party will be proposing its own tax plan in the coming days but he said Monday that he favours cutting the GST from essentials like internet access, cell phone and heating bills.
“Those are bills where if you remove the GST that will disproportionately help workers,” he said.
Singh did not address the fact that taking the GST off those bills would also provide a break on essentials for higher income earners.
ABOUT THE AUTHOR
Peter Zimonjic is a senior writer for CBC News who reports for digital, radio and television. He has worked as a reporter and columnist in London, England, for the Telegraph, Times and Daily Mail, and in Canada for the Ottawa Citizen, Torstar and Sun Media. He is the author of Into The Darkness: An Account of 7/7, published by Vintage.
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