Canadian Government Highlights Tax Relief For 2011
Summary
This article focuses mainly on some of the important tax changes that the Canadian government has made that will be taking place this year of 2011. It starts off with the tax reduction of the general corporate income tax rate. This reduction will result in higher wages, more jobs and improved living standards. This has been reduced by 1.5%, originally it was 18% now 16.5%. There will also be improvement in child benefit for specifially parents who live sepereately and share custody of a child. These parents will each recieve several benefits such as Canada Child Tax Benefit and Universal Child Care Benefit. This change will be in effect for benefits payable starting July 2011. Furthermore, specifically for parents and grandparents who need more struggle with providing long-term financial security of a child or grandchild with a disability, the government has applied the tax-free rollover. This results in a decrease in the individual's Registered Retirement Income Funds or Savings Plan which will be a part of the Registered Disability Savings Plan. However the contributions from Registered Disability Savings Plan will only affect those who passed away after 2007, which will also be in effect after June 2011.
Connections
As I've read the article focuses on mainly 3 different tax changes, general corporate income tax rates, retirement funds and disability savings plans. Just as the textbook states, "the largest component of governement spending is social services. These services also include child tax benefit program employment insurances. More than $11 billion was once spend on employment insurance benefits and admintration. The article says that there will be a reduction in general coporate income tax which benefits the business industry because it means there will be higher wages, more jobs and improved living standards. While the government is reducing and making tax changes, it is both a positive and negative change. The reduction of taxes means the government recieves less money. However, the government is able to control and balance the spending in Canada. Majority of the governments spending goes to goods and services. The changing being made on certian funds and tax rates this year will not affect the government. Page 120-123 in the textbook talks about the growth in government spending and where it is being spent. The changes in tax this year is a benefit to a lot of people in Canada especially for those who are working or are registed in a retirement of disability savings plan.
Reflection
After reading this article I've become more aware of the importance of tax and how little changes in tax rates have a great amount of impact on many people. I think it is good that the government made these changes because is helping a lot of people with their long-term financial savings. Especially for those who are nearing retirement and struggling financially. However these changes don't really affect me or benefit me now, they will probably be in the future.
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ReplyDeletePersonally, i think the reduction of general corporate income tax for citizens was a very good change because it allows the low income families to be more stable and afford more goods. On top of that, more jobs would be available because large corporate companies are able to reduce in their tax payments. Even though those are the cases, the bad side of this is probably the result of the government receiving less taxes from citizens, making them have less money to provide services such as health care for us. As years pass by, there are more and more families getting divorced and many single parents who are in need for help. The benefit towards single parents who still hold custody in their children is also very reasonable. This should help out many of the single parents in different ways. As of the Registered Disability Savings Plan which is only effective to people who passed away after 2007 seemed a bit unfair for some, but eventually should turn out to be a very good change
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