I'm sure that every government around the globe is now feeling like they are animals in the gun sights of the general population. With a global economic slowdown, governments have been doing everything possible to stimulate spending. Included in that is running a deficit. Over the past twelve years, Canada has been slowly paying down our national debt. Our current national debt is $460B, That will increase as we run a deficit for the next two years - expected to be $64B. There goes twelve years of hard work.
Below is a summary of the budget from the Globe and Mail. If you skip to the bottom of the blog, you'll see the real "meat" within the budget.
$1-billion over five years for a development agency to help people and businesses in Southern Ontario. $1-billion over two years for a Community Adjustment Fund.
A $20-billion cut to personal income taxes, increasing the basic personal amount and top of the two lowest income tax brackets by 7.5 per cent.
Home Renovation Tax Credit, offering $1,350 in tax relief for home renovations. An additional $50-billion to the Insured Mortgage Purchase Program. First-time home buyers to get up to $750 in tax relief. $2-billion for social housing for low-income earners, seniors, people with disabilities and native Canadians.
$8.3-billion skills budget over two years, half of which will be used to freeze premiums. Employment Insurance program enhancements. Training programs for jobless Canadians. Extend EI by five weeks to 50 weeks. Improve work sharing provisions.
Almost $12-billion in new project funding over two years, including a $4-billion fund for shared-cost projects with provinces and municipalities to repair roads other infrastructure. The government will also create a $500-million fund for recreational facilities like hockey arenas. Projects include improvements to the Montreal-Ottawa-Toronto rail corridor; repairing Montreal's Champlain bridge, twinning a section of the Trans-Canada Highway through Banff National Park; improvements to the Sarnia and Fort Erie border crossings.
New disclosure rules and a minimum grace period on credit cards.
Improved access to capital from $13-billion in additional financing for Canada Mortgage and Housing Corp., Export Development Canada and the Business Development Bank of Canada.
New life insurance debt guarantee facility. Extend capital cost allowance rate on investments in manufacturing or processing equipment and machinery. Offer a temporary 100 per cent CCA rate for computers bought after Jan. 27, and before Feb. 1, 2011. Increase the income eligible for the small business tax rate to $500,000 from $400,000. Increase maximum loans available under the Canada Small Business Financing Program .
Create a national securities regulator, with provincial participation on a voluntary basis. Develop a national strategy on financial literacy.
$225-million over three years to extend broadband coverage to unserved communities.
Offering short-term repayable loans to the industry. Create a $12-billion credit facility to support vehicle and equipment financing.
$170-million over two years.
Mineral exploration tax credit extended by one year.
$350-million over two years for Atomic Energy Canada Ltd. New Clean Energy Fund, to generate more than $2.5-billion in investments. Accelerated write-offs for companies that invest in carbon capture and storage technology. New $1-billion green infrastructure fund, including transmission lines to connect renewable energy projects.
$2-billion to repair post-secondary institutions. $50-million for the Institute for Quantum Computing in Waterloo, Ont. $87.5-million for additional doctoral and masters' scholarships.
$515-million over two years for schools, water and key community services. $200-million for skills and training. $400-million for social housing on reserves. $325-million to aboriginal organizations and provinces to deliver health programs and child and family services.
$500-million to expand the use of electronic health records.
Raise the level at which the National Child Benefit supplement and Canada Child Tax benefit are phased out.
$500-million agricultural flexibility program. $50-million over three years to increase slaughterhouse capacity.
$200-million over two years for the Canadian Television Fund. $60-million over two years for community theatres, libraries and museums. Increased funding for the National Arts Training Contribution program. $30-million over two years for magazines and community newspapers.
$100-million over two years for “marquee festivals” and events to promote tourism. $40-million over two years to the Canadian Tourism Commission. $24-million to support cruise ship infrastructure along the Saint Lawrence and Saguenay rivers. $75-million over two years for Parks Canada facilities, and an additional $75-million for national historic sites.
- You pay less taxes. Across the board, all Canadians will pay less tax right now. The bad news is that lower taxes now will ultimately mean higher taxes in the future.
- New Home Renovation Tax Credit, which would be available to people who spend money on goods or work on their home before Feb. 1, 2010. The nuts and bolts of this tax credit: you would claim a 15-per-cent credit against spending of more than $1,000 and capped at $10,000, with a maximum credit of $1,350. Starts Jan 28/09.
- Each Canadian can now use $25,000 from RRSP's under the Home Buyers Plan for first time home purchase. You have more money available but it also means more to repay.
- Extension of EI benefits for an extra 5 weeks; freeze on EI rates and more money spent on training programs. How that helps you manage on $460 week is beyond me.
- $12B of infrastructure spending from coast to coast on schools, roads, transport and recreation centres. Jointly with the provinces, this is expected to create almost 200,000 new jobs. The bad news? If the provinces don;t come through, then the funds don't get spent.