Liberals’ key election vow to change income tax rates passes through House
Ottawa: The Liberal government’s centrepiece election promise to raise taxes on the biggest income earners while cutting the rate in a lower bracket has passed the House of Commons. MPs voted 230-95 today in favour of a motion featuring a collection of tax changes that will siphon about $1.2 billion annually from the treasury over the next five years. The Liberals had estimated the combined fiscal impacts of the taxrate hike and reduction would basically offset each other. Starting Jan. 1, the income-tax rate will drop to 20.5 per cent, from 22 per cent for taxable earnings between $45,282 and $90,563. The rate on all income earned beyond $200,000 will rise to 33 per cent, from 29 per cent. Opponents have said the government’s tax reduction should have been extended to also benefit those who earn less than $45,282.