It read like what it was; a document full of pre-election goodies, that will likely never see royal assent.
The big one is with the TFSA (Tax Free Savings Account). The limit is at $5500/year. Doubling should put it at $11 thousand, not 10 (5.5+5.5= 11). To get to 10 you have to subtract 5, and double it. Someone either got their math wrong, or their spin perfect because everyone is saying $10 thousand.
Another is the small business tax rate cut to 9%. This will likely be an effective measure everywhere except Ontario; the most vote-rich place in the land. Small businesses here will soon see a new pension plan, which depending on how many employees might take care of the tax cut.
And then there’s defense spending. $11.8 billion increase over 10 years beginning in 2017-2018. That’s two years, and at least (eliminating the possibility of a minority government) one election from now. If Conservatives lose or win a minority this is likely off the table. Does the $360 million promised this year to pay for the missions in the middle-east, and Ukraine count towards that?
The transit fund is aimed at cities, specifically the vote rich GTA. The new funding starts at $250 million/year in 2017 and growing to a permanent $1 billion/ year in 2018-2019. Again you’re talking possibly two elections from now; expect this one to be re-promised at some point. Transit is a desperate need, but $1 billion isn’t enough. It barely takes care of Toronto’s needs.
And now for the surplus, or is it? Joe Oliver had to play magician on this one dipping into the rainy day fund to make one worth $0.9 billion. In a country where anything east of Quebec has spent the last few months buried under snow is it wise to do this?
This budget is a political masterstroke. The Liberals are already promising to reverse the TFSA increase condemning it as a measure tailored to help the rich because most Canadians are living pay cheque to pay cheque. Politically the Liberals have just negatively defined themselves. And we all know what happens to political parties that do that.
Which brings us to Trudeau’s major point. At some point between income splitting, the expanded TFSA, increased spending on defense, security, and a business tax cut there’s revenue to be made up for. Eventually the piper will have to be paid.
But that doesn’t matter. Instead of a balanced government cuts, and spending budget it’s an election plank. Sensible planning doesn’t win elections, goodies do.