Wednesday, June 18, 2008

Why Dion May Be In Trouble


This comment, in reference to the G and M story on the Liberal plan:

" I'm not quite getting this math. A tax cut from 15% to 13.5% is equal to a 10% reduction. It looks like a 1.5% reduction to me. What am I missing? Can someone explain how this equals a 10% reduction? "


Forget about the tax cut component, I say we pour the "windfall" into Canada's education system.

30 comments:

Anonymous said...

Steve what I think it will be if this story is true is that this plan will spread over a few years so I think the reduction would total 10% over that course. Maybe I'm wrong. Never the less do you have the link where you got you're info.please thank you!

Anonymous said...

Geez, the "whole" plan isn't out yet - one more day folks.

I heard it was over 4 years.

knb said...

Yikes. We may need Crayola to support us here!

That said, it won't be an easy sell, but it's a plan and so far in my view it's a good one.

If this is reflective of a recipient of the news, my hope is that KISS principle will be applied here as much as possible.

Steve V said...

"That said, it won't be an easy sell, but it's a plan and so far in my view it's a good one."

Knb, I just posted this more in fun, than any commentary on if people will buy in. I'm actually excited, strangely enough. I've been waiting many years, many elections, for someone who can hold power to get serious. No matter your view, this is serious stuff.

Blues Clair said...

I gave up reading the comment section of the Globe and Mail awhile ago. It is pure madness.

The Conservatives are going to have to tread a fine line with this debate as the credibility with their 'Turning The Corner' enviromental plan is in shambles. Watching Martha Hall Findley today on Don Newman's Broadcast showed that the Conservatives can be put on the defensive as well... if the questions are hard enough.

knb said...

I know Steve and we agree. I was joshing too.

I share your excitement.

Mark Francis said...

15% of 100 is 15
13.5% of 100 is 13.5

The diff is 1.5

1.5 is 10% of 15.

Thus, it is a 10% reduction.

To argue that it is a change of 1.5% would be underselling, because people do get a 10% reduction in how much they pay in income tax.

Anonymous said...

What really scares the Cons is that everyone is reporting it as a tax CUT. Not exactly what they were hoping for.

Francesco said...

Steve
Think of it this way, if your stock goes from $15 dollars to $13.50 ..you have suffered a 10% reduction in the value...i.e. dion will reduce taxes by 10% for the first tax bracket....

Steve V said...

Is this for real?

Anonymous said...

We get it. You are making fun of the math-challenged. How will Dion sell his plan if people can't do a basic percent calculation. Hence, your facetious suggestion that the money go to fund education.

James Curran said...

Yes it is for real. I was on the conference call this evening.

15 - 13.5
23 - 22
26 - 25

are the real tax cuts they are going to be touting for the first 3tax groups in Canada.

The exciting part is that there will be corporate incentives as well.

The press conference is at 10:30

wilson said...

If we had a flat tax....but we don't.
We have tax brackets.

Heres the fed tax calculation formulas.

http://www.cra-arc.gc.ca/tax/individuals/faq/taxrates-e.html#federal

If you earn $37900
less base -37,885
equals $15.00
$15.00 X 22% = %3.30
formula then adds $5683
your fed tax is $5686.30

Run the $37900 thru the formula with 21% and you have saved $0.15
yup 15 cents.

At the top of the bracket,
$75700, (75700-37885= 37815 X22% and add 5638)
the 1% reduction takes you from $13,957 to 13,579 in fed tax, a reduction of $378.00

Those poor dudes at the lower portion of the 2 middle income brackets, are going to be very disappointed.

mitch said...

How about this one:

the lowest income earners:

1) pay no income tax,

2) but still have to heat their homes.

Even assuming the income tax cut "equals" the carbon tax (which most rightly do not believe),

it's a tax on the poor.

Quite the policy, eh, force people (living in one of the coldest countries on the planet) to "choose" between staying warm in the winter, and paying more taxes.

The starkest example of political suicide I can recall in the last three decades.

mitch said...

"What really scares the Cons is that everyone is reporting it as a tax CUT."

In other words, reporting it dishonestly.

You've got to love a policy, the success of which is dependent upon the population being fooled into believing it is something that it is not.

mitch said...

Canada's newest "sin tax".

Among the "sins" are now, smoking, drinking, and......

staying warm in the winter.

Anonymous said...

Good grief, I think you ALL need to go back to school in order to hone your math skills.

1st tax level--10% decrease (in taxes, not % of taxable income). This means that if you paid say $3,000 before, you would now pay $2,700--$3,000 minus $300.

Wilson, in the second tax bracket, you save 5% of what you had previously paid on income above the first bracket.

Let's not all panic until we see the details tomorrow. I suspect other changes as well, such as raising the personal exemption.

wilson said...

Not so anon. The 1% tax reduction in the second and third brackets may be 5% more at the top of that bracket,
but if you are at $37,900 your tax savings is at 15 cents, under a buck when you creep into the next bracket, say at $77,770.

James Curran said...

So you prefer not to have personal income tax cuts then Willie?

I'll gladly take them. There will also be tax credits for the poor, the isolated, the agricultral sector. And, wait for it, a tax break for businesses too.

Scott Tribe said...

Even Warren Kinsella, who has been quite harsh in his criticism of this , has now revised his opposition somewhat

wilson said...

I would rather have my personal exemption raised James, or an after tax refundable credit.
That way, it does not matter where you land in the tax bracket, the reduction is absolute.

Rather than pay tax on the necessities like heating my home, I would pay extra for the plastic bags at superstore, and garbage pick up, or pay a carbon tax when I go to register my old jalopy every year.
I could choose to bring cloth bags to shop with or pay a buck a bag, recycle and compost or pay an eco fee, and drive more economically.
But eating, driving to work, heating my home and having the lights on after dark are not enviro sins.

Steve V said...

wilson

What a joke you are. 15 cents?? That would mean you are paying only $3.30 on you tax bill in total, using the income number you've provided. That's you insane math, does anyone believe that?? Easily, the most ridiculous comment I've heard. Good grief.

Anonymous said...

"You've got to love a policy, the success of which is dependent upon the population being fooled into believing it is something that it is not."
Is this out of the Cons' operating manual?

Steve V said...

""You've got to love a policy, the success of which is dependent upon the population being fooled into believing it is something that it is not."


Is that so? Don Drummond came out in favor of the plan today, you know the same guy the Cons hired to trash Kyoto. You guys can chirp and chirp, but I'm entirely impressed at who is lining up behind this plan, environmentalists and our most prominent economists. Chirp, chirp, you have nothing but NOISE to offer.

James Curran said...

That's only the beginning STevie. There's lots more that will be lining up behind this. People of note so to speak.

Steve V said...

james

As I've said all along, it is crucial that the Liberals have third party backing of this plan. I like what I've seen, and I expect some more surprises. Even the detractors, who are against the "timing" are saying it isn't bad policy, which, if we have a long discussion, should rise above the HOWLS.

They're scared.

Steve V said...

More support.

Josh G said...

If you earn $37900
less base -37,885
equals $15.00
$15.00 X 22% = %3.30
formula then adds $5683
your fed tax is $5686.30


I don't know what country you live in, but here in Canada the basic personal exemption is somewhat under $10,000. What the hell are you talking about?

Steve V said...

"What the hell are you talking about?"

She has no clue, it's actually hilarious at this point.

Anonymous said...

Wilson,

Guess what?

As a single person in NB, I can save $722 annually with an income of $38,000 (the Liberal web site calculator rounded off the 37,900 to 38,000).

But as a single-income earner with the same income and with two children, I can save $3,264 annually in income tax. That's a long, long way from 15 cents.