Chapter 4

"New Year Tax Reductions Won't Make Anyone Rich"

Canadians in 2007 will get less tax coming off their earnings this year. However, it isn't a giant amount and it is barely even noticiable. If you're working alone the increase in money isn't a giant amount. "Those savings will amount to $126 for someone earning $15,000, $82 at an income of $35,000, $106 at $45,000, $106 at $60,000, and $126 at $100,000, it calculates." As you can see it will save just a little money from they gross income you have. The higher income people will save less than the lower income people because of the brackets of tax they're in. On the other hand, families with children gain a bit more because of child care and the Canadian Pension Plan. A family of four could expect $1,545 to $964 depending on where you live. To conclude, taxpayers will save some money from taxes this year, but it is not going to make you have enough to go on vacation.

This relates to chapter 4 because of the goverment taxing. As you can see from the progressive system the higher income people will save less money from taxes and the income levels of $45,000 and $60,000 save the same amount of money. However at the income level of $15,000 you could expect $126 more. Government is letting out some of the money back by cutting the taxes, but are tax rates are still very high.

I think that this tax reduction will help many low income people instead of the high income people because they will not gain much from this. It is good that the government is finally cutting tax rates. Is it really noticiable for the midrange to high income people though? Although it was a reduction in tax rates, I think it was a bit too low.