Are Conservatives using tax policy to push for traditional families?
The Conservatives laid the groundwork on Tuesday to extend income splitting for married and common-law couples, with confirmation in the economic and fiscal update that a balanced budget is coming in 2015. During the 2011 election, Stephen Harper pledged that once the federal budget was balanced, parents with children under 18 would be allowed to split up […]
November 12, 2013
The Conservatives laid the groundwork on Tuesday to extend income splitting for married and common-law couples, with confirmation in the economic and fiscal update that a balanced budget is coming in 2015.
During the 2011 election, Stephen Harper pledged that once the federal budget was balanced, parents with children under 18 would be allowed to split up to $50,000 of income with their partner. This means that some additional income could be declared for tax purposes by the spouse in the lower tax bracket, reducing the overall taxes paid by the couple.
But dig into the details, and the policy is a one-two punch for conservatives.
First, the initiative will cost Canadians billions of dollars. For conservatives who want to starve the public treasury so there’s less money to invest in public services, spending surpluses on tax cuts is pure gold.
Second, social conservatives love the idea because they hope it encourages women to stay at home and take care of the kids. You know, just like the perfect middle-class family from the 1950s. It amounts to a tax policy that discourages mothers from entering, returning to or remaining in the workforce.
That’s why the Institute of Marriage and Family Canada, the research arm of the conservative Christian group Focus on the Family Canada
, is doing its part to promote
what is expected to be the Conservatives’ big-ticket promise for the 2015 election campaign. The Manning Centre, whose senior staff includes Dave Quist, the former executive director
of the Institute of Marriage and Family Canada, will likely promote the idea at every turn.
Let’s take a closer look at this “family-friendly” idea.
The largest share
of the benefit would go to high-income families where one partner is in the top tax bracket and the other has no earned income (think Leave it to Beaver
). The Conservative approach to income splitting would provide no benefit at all to single-parent families – even though more than a quarter (28%) of all children live in single-parent families. The same holds true for families where both partners work and have incomes below $43,561.
In other words, income-splitting provides zero relief to families with children who are most in need, including those who live in poverty. Rather, what it does is transfer more of the tax burden onto single-parent families and lower- and middle-income families. It promises to exacerbate – not reduce – existing income and gender inequality.
Maybe that’s the point.
Photo: erjkrpunczky. Used under a Creative Commons BY 2.0 licence.
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