Federal Finance Minister Announces GST and Personal Income Tax Cuts

Federal Finance Minister, Jim Flaherty announced several tax cuts today.

They include:

• A reduction in the GST from 6% to 5%, effective January 1st, 2008.
• An increase in the basic personal amount exemption to $9,600 from $8,929, retroactive to Jan. 1, 2007;
  Two years later, on Jan. 1, 2009, the basic personal amount exemption will be increased to $10,100;
• Reducing small business income tax to 11 per cent by 2008 and $10 billion in federal debt relief
• The lowest personal income tax rate moves to 15 per cent from 15.5 per cent, effective Jan. 1 2007, undoing a change made in the first Conservative budget.

As usual, the NDP and the Bloc have announced that they will vote against this mini-budget, when it comes to a vote in parliament tomorrow. It is sure to pass though, as the Liberals have indicated that they will not vote against it.

Overall, I have to say kudos to the Conservative government for this mini-budget. It is coming at the right time and will benefit most Canadians.