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Are 2020's tax changes 'significant' or 'a wash'? – CBC.ca

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When Finance Minister Bill Morneau introduced a motion earlier this month to keep the Liberals’ election pledge to cut income taxes for the middle class, he called the measure “significant” and said it would impact 20 million Canadians.

But most Canadians would have to have to study their pay stubs very closely after Jan. 1 to detect that tax cut and other changes to deductions that arrive with the new year. And unless they live in Alberta, they may not notice this year’s tax changes at all (more on that later).

“It’s going to be very subtle. And I’d be surprised, frankly, if anybody noticed, if nobody told them,” said Janet Gray, a personal financial planner from Orleans, Ont.

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Finance Minister Bill Morneau tabled a motion in early December to implement a Liberal campaign promise: a phased-in increase to the amount of income Canadians can earn tax-free. (Adrian Wyld/Canadian Press)

The basic personal amount — the amount of annual income Canadians can keep tax-free — is slowly increasing over the next four years, to $15,000 by 2023. In previous years, this amount has been adjusted to the rate of inflation, but Morneau’s most recent enhancement goes beyond that.

For the 2020 tax year, it’s rising by $931, to $13,229.

For low-income Canadians who’d otherwise have to pay 15 per cent income tax on that amount, the annual tax savings could be about $140. Some of the poorest may no longer owe any tax at all.

“There is still about one million Canadians that earn less than that basic personal exemption,” Gray said. “So of course, that’s going to be meaningful for them.”

For Canadians in the middle-income brackets, the annual savings could be up to $240.

But divide that across 26 bi-weekly pay periods and the income bump that starts appearing on Canadian pay stubs doesn’t exactly look life-changing: it’s enough for an extra cup of fancy coffee or, for higher earners, a food truck lunch every two weeks.

For those earning more than $150,473 in annual income, the savings are partially clawed back, or not offered at all for incomes over $214,368.

Keeping up with inflation

Federal tax brackets — the thresholds that trigger higher rates of taxation as incomes rise — have been adjusted for 2020 based on a 1.9 per cent rate of inflation.

Gray points out that in several Canadian cities, particularly those with hot housing markets, the actual rate of inflation may be higher — which means that these tax brackets and sources of government income like the Canada Child Benefit (also indexed and rising slightly as of July 1, 2020) may not be keeping up.

When business or household budgets are sensitive to things like rising food costs or higher taxes on fossil fuels, the government’s calculations fall behind taxpayers’ lived reality.

Janet Gray, a financial planner in Orleans, Ont., said she thinks the Liberal government’s latest tax cut for the middle class will barely be noticeable for some people. (J.F. Benoit/CBC News)

“Some people are going to feel inflation more than others depending on their own lifestyle,” Gray said. 

Payroll deductions change

Farther down the pay stub, deductions for Employment Insurance and the Canada Pension Plan are changing, too.

EI premiums are decreasing from 1.62 to 1.58 per cent in 2020, while the maximum insurable earnings will increase to $54,200 from $53,100 in 2019.

That’s a saving, but don’t spend it all at once: it amounts to less than a dollar per bi-weekly paycheque.

CPP premiums, on the other hand, are increasing from 5.1 to 5.25 per cent for employees (double that for the self-employed) and the maximum pensionable earnings — the amount the government uses to calculate an employee’s CPP contributions for the year — is going up to $58,700.

For those earning that much or more, deductions could increase by about $5.73 per bi-weekly paycheque (less for lower-income earners). But remember: today’s CPP contributions become pension income at retirement, so CPP premiums are a modest forced savings program, not a tax.

“It’s kind of painless, a little bit at a time,” Gray said. Young workers may find it difficult to save for retirement and are less likely than previous generations to have employer-sponsored pensions, so “CPP is taking on a little bit more of that job.”

The problem, Gray said, is that many people max out their EI and CPP contributions before the end of the year, and get used to paycheques leading up to New Year’s that have fewer deductions. When January comes around again, their net pay deposits drop and “it’s a little bit of a shock.”

This makes it harder to detect subtle deduction changes at the start of a new year.

Taken together with Morneau’s tax cut, “I think it’s going to be mostly a wash,” Gray said.

Stock option change delayed

A few other tax items change with the new calendar year.

The tax-free savings account contribution limit is going up again, by another $6,000. For those eligible to start one who’ve never had a TFSA since its inception in 2009, there’s a possible $69,500 of contribution room.

For those considering upgrading professional skills, a new Canada Training Benefit allows taxpayers to accumulate up to $250 per year toward a future tax credit to offset up to 50 per cent of eligible tuition costs.

And those who spend some of their hard-earned income to support digital journalism will be able to claim up to $500 in eligible subscriptions, for a tax credit worth up to $75, starting with their 2020 returns.

Another expected change was suddenly cancelled by Morneau’s department late in the day on Dec.19: a move to start taxing stock options more like regular income.

In a press release, the department said that, following consultations with stakeholders, “the government will announce details on how it intends to move forward” in the 2020 federal budget.

Revised climate incentive rebates

Perhaps the most significant change for some Canadians is in the rebates they receive for living in provinces where they pay the federal carbon tax on things like gasoline and home heating fuels.

As of April 1, 2020, the federal price on carbon will rise from $20 to $30 per tonne of emissions. In line with that, residents of four provinces will receive revised climate change incentives when they file their taxes this spring.

In Ontario, Manitoba and Saskatchewan, the payments, based on household size, are higher than last year’s.

For example, a single person in Ontario received $154 last year, but is eligible for $224 this year. A family of four in Saskatchewan received $609 last year, but is eligible for $809 this year.

New Brunswick, which recently reached an agreement with the federal government on its carbon pricing plan, will no longer be subject to the federal tax as of April 1 and its residents will not receive rebates when they file their taxes. 

Gray said she doesn’t think people make the connection between rising costs for things like gas and the bonus they got at tax time.

“I don’t know that it was a meaningful amount for many people, but it was still nice to have,” she said. “It’s a gift.”

2020 Climate Incentive Payments
  Ontario Manitoba Saskatchewan Alberta
Single adult $224 $243 $405 $444
Second adult in a couple, or first child of a single parent $112 $121 $202 $222
Other children under 18 $56 $61 $101 $111
Total for a family of four $448 $486 $809 $888

Which brings us to Albertans, who will receive the federal incentive payments for the first time in 2020.

Their first payments are larger, to reflect three months when Albertans are paying a carbon tax based on $20 per tonne of emissions (January-March 2020) and twelve months when they’re paying the $30/tonne price for 2020-21.

Alberta also generates relatively more carbon emissions that are now subject to the federal tax, and the federal government pledged to return 90 per cent of its carbon tax revenues.

The tax is meant to encourage households to consume less carbon-polluting energy — so the more people conserve, the more they benefit from the rebate.

Unlike the provincial carbon pricing scheme Premier Jason Kenney’s government cancelled earlier this year, every Alberta household, regardless of income, is eligible.

A single adult in Alberta will receive $444. A household of four will receive $888.

New climate incentive payments could add more to Albertans’ bottom lines than the Liberal tax cut.

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Child care in Canada: Trudeau unveils new help for providers – CTV News

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The federal government is launching a new loan program to help child-care providers in Canada expand their spaces, and will be extending further student loan forgiveness and training options for early childhood educators, Prime Minister Justin Trudeau announced Thursday.

The prime minister unveiled a trio of child-care-centric commitments that will be included in the upcoming federal budget, with the aim of opening up more $10-a-day child-care spaces across the country, as the Liberals continue to work towards creating 250,000 new spaces by March 2026.

Specifically, the Liberals are vowing to offer $1 billion in low-cost loans and $60 million in non-repayable grants to public and not-for-profit child-care providers, so they can build or renovate their care centres. 

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This funding will be administered through the Canada Mortgage and Housing Corp. (CMCH), which Trudeau called “a common sense approach that will help child care be developed alongside housing.”

An additional $48 million is being earmarked for the next four years to extend student loan forgiveness — similar to the program offered to rural doctors and nurses — to early childhood educators, in an effort to incentivize more teachers to work in smaller communities. 

The federal government is also promising $10 million over the next two years to train more early childhood educators.

The prime minister, speaking in Surrey, B.C., alongside the minister currently leading the file, Jenna Sudds, touted the bilateral child-care agreements in effect across the country for seeing thousands of children placed in affordable spaces.

However, in recent months Canadian parents and care providers have sounded alarms about increasingly long daycare waitlists. And, operators in some provinces have threatened to withdraw from the lower-cost program because they’re struggling to make ends meet. 

Trudeau said while the government has funded 100,000 spaces so far and is aware of the challenges in rolling out this new national program, not enough families have access and not all provinces are moving as fast as they should. 

“I want to take a moment to talk to young moms, many of you millennials. You’ve grown up with so many pressures in this economy, the 2008 recession, COVID, climate change … and we want to make sure that everyone — especially moms raising kids — has the best chance to succeed and thrive,” Trudeau said.

“As Canada grows, as families grow, we want to make sure more kids can access high-quality child care… That’s what fairness for every generation is all about.”

The prime minister also got political, accusing Conservative Leader Pierre Poilievre of opposing the program, despite the Official Opposition voting in support of a recently passed Liberal piece of legislation meant to enshrine in law a commitment to the Canada-wide early learning and child-care system, and the long-term funding needed to maintain it. 

Reacting to the news, NDP MP and critic for children, families, and social development Leah Gazan said the announcement was a “direct result of advocacy” by her party, care workers, unions, and women’s organizations.

She also pointed the finger at the Conservatives, accusing them of trying to stall the program and push for a “for-profit private system that parents can’t afford.” 

Liberal pre-budget strategy

Similar to how Wednesday’s rollout of renter-fairness-focused pre-budget news went, cabinet ministers are making echo announcements of the new child-care affordability measures across the country Thursday afternoon. 

This is all part of a new communications strategy the Liberals are employing in the lead up to the release of the April 16 federal budget.

Practically every day between now and when Deputy Prime Minister and Finance Minister Chrystia Freeland releases the massive economic document, the Liberals are expected to tease out bits and pieces of the budget.

In an effort to stretch out their ability to market the measures within it, Trudeau as well as members of his cabinet will unveil new initiatives over the next two weeks, to the point that the vast majority of the budget will be public prior to budget day.

Traditionally, governments have held budget news — save for some pre-tabling leaks — for the day the document is tabled in the House of Commons post-daylong reporter and stakeholder lockup.

Kicking off this strategy on Wednesday, Trudeau issued a video across social media platforms indicating the overall theme for the 2024 budget will be “generational fairness,” a message meant to speak to millennials and Generation Z.

“When I first decided to run for office, one of my biggest motivations was working to create a Canada that young people saw themselves… As prime minister, I’ve never lost sight of that,” Trudeau said in the clip.

“You as a young Canadian are the heartbeat of our economy. You power our growth and you deserve an economy that gives you a fair shot at success. But, this moment we’re all living in is throwing big challenges your way… So we’re going to roll up our sleeves and work like hell. And we’re going to tell you about what we’re doing to fix it, over the next two weeks.”

While Trudeau’s 2015 election victory was credited in part to a historic surge in young people turning up at the polls, Poilievre has been chipping away at that Liberal voting bloc of those aged 43 and under, seeking to appeal to their current struggles to get ahead with his “powerful paycheques” and housing affordability arguments.

In November 2023, Trudeau tapped Max Valiquette, a marketing guru with self-described expertise in understanding younger generations, as his new executive director of communications.

“We’re witnessing a different communication strategy from the government. They’re implementing something they’ve not tried before. We’re not going to have a budget day on April 16. We’re going to have budget days between now and April 16,” said political commentator Scott Reid in an interview on CTV News Channel.

“Frankly, this government knows that it needs to break through, it knows that it needs to connect with Canadians… Is it going to turn around the polls overnight? No. Might they get a little bit more of a hearing than they otherwise would have been? Probably.” 

With files from CTV News’ Vassy Kapelos and Annie Bergeron-Oliver

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Ontario releases 2023 Sunshine List, top earner made $1.9M – CBC.ca

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Five employees at Ontario Power Generation are in the top 10 earners on the province’s so-called sunshine list for 2023, with the province’s highest salary nearing $2 million.

The annual sunshine list documents public sector employees with salaries over $100,000. In this year’s edition, there are 300,570 names, more than 30,000 higher than last year.

Kenneth Hartwick, CEO of the electricity Crown corporation, is in the top spot again with a salary of $1.93 million.

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Two other executives at the organization — chief strategy officer Dominique Miniere and chief projects officer Michael Martelli — made nearly $1.2 million and nearly $1 million, respectively.

You can find a list of the top 100 earners below.

The presidents and CEOs of the Hospital for Sick Children and the University Health Network are also in the top 10, earning around $850,000 each. So is Phil Verster, who is president and CEO of the provincial transit agency, Metrolinx, with a $838,097 salary.

Caroline Mulroney, president of the Treasury Board, highlighted other high growth areas in a release.

“The largest year-over-year increases were in the hospitals, municipalities and services, and post-secondary sectors, which together represented approximately 80 per cent of the growth of the list,” she said.

The list shows 17 professors or associate professors at the University of Toronto had earnings of $500,000 or more.

A statement from a University of Toronto spokesperson said the school competes with top universities and private-sector employers around the world for faculty members.

“This occasionally results in salaries above the usual range for a small number of faculty members.”

An Ontario Power Generation building.
Five employees at Ontario Power Generation are among the top 10 spots of the annual sunshine list for 2023. (Cole Burston/The Canadian Press)

Premier Doug Ford earned $208,974 last year. His chief of staff, Patrick Sackville, earned $324,675.

Matthew Anderson, CEO of Ontario Health, a provincial agency the Ford government created in 2019, earned $821,000. Meanwhile the public servant leading the Ministry of Health, deputy minister Catherine Zahn, earned $477,360, and Health Minister Sylvia Jones, $165,851.

There are more than 25,000 registered nurses on the list, including seven who earned more than $300,000 last year.

Chief Justice Sharon Nicklas, who was appointed to the top post in the province’s judiciary last May, earned $388,960.

The police chiefs of Thunder Bay, Daniel Taddeo, ($376,428) and Hamilton, Francis Bergen, ($374,492) were paid more last year than OPP Commissioner Thomas Carrique ($373,472). Taddeo retired in April 2023. 

Toronto police Chief Myron Demkiw, who took over the post in late 2022, earned $353,411. 

Organizations that receive provincial government funding are also required to disclose salaries for the sunshine list, so it includes top earners at some registered charities.

The chief executive of the True Patriot Love Foundation, Nicholas Booth, earned $421,149. The foundation funds support programs for veterans and military families. 

The president and CEO of the Canadian Red Cross Society, Conrad Sauve, earned $412,970, while the YMCA of Greater Toronto’s chief executive, Medhat Mahdy, earned $394,057.

Salaries of other key Ontario public figures include:

  • $826,539 for Ontario Pension Board CEO Mark Fuller.
  • $709,581 for Ontario Lottery and Gaming Association president & CEO Alfred Hannay.
  • $601,376 for Registered Nurses Association of Ontario CEO Doris Grinspun.
  • $596,392 for Dean of Ivey Business School, Western University, Sharon Hodgson.
  • $563,291 for LCBO president & CEO George Soleas.
  • $546,053 for Dean of the Faculty of Health Science, Queen’s University, Jane Philpott.
  • $533,112 for Royal Ontario Museum president & CEO Joshua Basseches.
  • $486,192 for University of Toronto president Meric Gertler.
  • $464,148 for Chief Medical Officer of Health Dr. Kieran Moore.
  • $455,091 for Chief Coroner Dr. Dirk Huyer.
  • $404,003 Art Gallery of Ontario director and CEO Stephan Jost.
  • $395,974 for former auditor general Bonnie Lysyk.

Adjusting sunshine list threshold

The sunshine list has been around for almost 30 years, always set at six figures and up. 

At Queen’s Park on Thursday, some members of provincial Parliament faced questions on whether the $100,000 starting point should be adjusted.

Green Party of Ontario Leader Mike Schreiner said it should be pegged to the rate of inflation, but others disagreed.

“I think that people think that $100,000 is still a lot of money, especially in an affordability crisis,” said NDP MPP Catherine Fife, who’s also the finance critic.

Government House Leader Paul Calandra said the government has no plans at this time to change the threshold on the sunshine list.

“I think it’s an important document that serves the people well in highlighting the salaries of our public employees.”

The Public Sector Salary Disclosure Act, enacted by former Progressive Conservative premier Mike Harris in 1996, compels organizations that receive public funding from the province to report the names, positions and pay of people who make more than $100,000.

The interactive chart below shows the top 100 earners on the list, based on both salary and benefits.

Search the complete Sunshine List for yourself here.

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1 dead, 2 critically injured after car crash in Montreal

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Montreal

Three people are in hospital with critical injuries after their vehicle crashed into a tree. Police believe they might be connected to two drive-by shootings that took place early Thursday morning.

2 drive-by shootings also took place overnight

an SPVM car near a taped-off crime scene
Montreal police are investigating a car crash possibly linked to two drive-by shootings. (Mathieu Wagner/Radio-Canada)

Urgences-santé say one person died and two others were critically injured after their vehicle hit a tree in the Rosemont neighbourhood.

Montreal police believe the crash may be linked to two drive-by shootings early Thursday morning.

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The first happened around 5 a.m. on Pie-IX Boulevard. Police say a car was shot at repeatedly and the driver, a 41-year-old man, was injured in the upper body. He was transported to hospital, but his life is not in danger, say police.

Shortly afterward, shots were reported in the Plateau Mont-Royal borough, near the intersection of Saint-Joseph Boulevard and Henri-Julien Avenue. No one was injured.

Police say they are investigating to determine if there is a connection between the collision and the shootings. Montreal police spokesperson Jean-Pierre Brabant says it’s possible those in the vehicle were involved in the shootings.

The province’s independent police watchdog is now involved.

with files from Chloë Ranaldi

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