The 2000 Economic Statement and
Budget Update October 18, 2000 The 2000 Economic Statement and Budget Update builds on Budget 2000 by cutting taxes further and faster. The combined tax measures outlined in Budget 2000 and the Update deliver - by far - the largest tax cut in Canadian history some $100 billion in cumulative tax relief by 2004-05. But it is not such a large tax cut that it will impair our ability to deliver the essential services such as health care - that Canadians rely on as part of our shared quality of life. All Canadians will get a federal tax cut -- moderate and middle-income Canadians in particular. 52% of our tax cuts go to Canadians making $60,000 or less. Almost all of the cuts will take effect in less than two-and-a-half months By 2004-05, Canadians average personal income tax burden will be 21% less and 27% less for families with children. Next year, a single parent with one child earning $33,000 will get a 100% tax cut or $900. Next year, a one-earner family with two children making $40,000 will get a tax cut of 32% or $1,100. In less than 4 years their tax cut will be 59%. Next year, a two-earner family of four with a combined income of $60,000 will get a tax cut of 18% - or $1,000. In less than 4 years, their tax cut will be 34%. Cutting Income Tax Rates All personal income tax rates will drop as of January 1, 2001:
Additional Tax Measures for Those Who Need it Most Effective July 1, 2001, the Canada Child Tax Benefit for low and middle-income Canadians will be raised with maximum benefits for the first child rising to more than $2,500 in less than 4 years. Effective January 1, 2001, the Disability Tax Credit amount will be raised to $6,000 from $4,293. Effective January 1, 2001, the credit amount for caregivers of dependent relatives who are elderly, infirm or disabled will be increased to $3,500 from $2,386. Tax Measures to Encourage Entrepreneurship, Jobs and Growth The capital gains inclusion rate will immediately be further cut from two-thirds to one half. Tax-free rollovers will immediately be expanded and made available to more businesses. A legislated timetable will be provided for accelerating corporate income tax cuts from 28% to 21% with a one point drop in 2001 followed by a two point cut in each of the following three years. One-Time Relief for Heating Expenses In response to rising energy prices and heating costs, in early 2001, the government will provide one-time relief from heating expenses to help low and modest income Canadians.The relief will be $125 per person and $250 per family. |
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