CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Income Splitting Plans Hit Canadian Deficit Figures

Income Splitting Plans Hit Canadian Deficit Figures

by Mike Godfrey, Tax-News.com, Washington

25 December 2014


The introduction of so-called income splitting helped add CAD1.6bn (USD1.4bn) to the Canadian deficit in October, according to the latest Fiscal Monitor.

There was a budgetary deficit of CAD3.2bn in October 2014, compared to a deficit of CAD2.5bn in October 2013. The October Fiscal Monitor includes a CAD1.6bn adjustment to revenues, to include the year-to-date costs of the introduction of the Family Tax Cut and the doubling of the Children's Fitness Tax Credit (CFTC). Personal income tax revenues were down 11.6 percent (CAD1.6bn).

In November, the Government announced that income splitting will be available from the 2014 tax year, enabling families to split up to CAD50,000 of their income each year for tax purposes. The previous month, the Government unveiled plans to increase the maximum amount that can be claimed under the CFTC from CAD500 to CAD1,000, effective from the 2014 tax year, and to make the credit refundable from the 2015 tax year.

The Fiscal Monitor also shows that revenues decreased by 0.9 percent (CAD0.2bn) in October. The impact of the year-to-date costs of the new tax incentives was partially offset by a CAD0.8bn increase in corporate income tax revenues.

For the April to October 2014 period of the 2014-15 fiscal year, the Government posted a budgetary deficit of CAD4bn, compared to a deficit of CAD12.8bn in the same period of 2013-14. Revenues were up 3.7 percent (CAD5.3bn), reflecting increases in a majority of revenue sources. Government program expenses were down 2.3 percent (CAD3.2bn).

TAGS: tax | tax incentives | budget | corporation tax | ministry of finance | tax rates | Canada | tax reform | individual income tax

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »