Friday, February 06, 2009

targeted tax cuts don't work

The Canadian Taxpayers Federation has long called for a lower, simpler and flatter tax system. An uncomplicated tax system will provide the most benefits to the greatest number.

How do we know? The problem with targeted tax cuts is most people don't know about them so don't take advantage of them.

According to a Financial Post story from February 05, 2009;

A new poll indicates nearly 75% of Canadians did not take advantage of any new
tax credits on their 2007 tax return.

The poll conducted by Angus Reid Strategies asked 1,010 Canadians if they took advantage of any new tax credits
last year, and if so, which ones. The results show that only one in four people
surveyed claimed any of the new tax credits introduced for the 2007 tax year.

Those new tax credits included the Children's Fitness Credit, Child Tax Credit
and Pension Income Splitting.

"Last year, a number of tax credits and changes
were introduced that would benefit just about every Canadian taxpayer," said
Cleo Hamel, senior tax analyst at H&R Block Canada. "But if you don't claim all
the credits and benefits you are entitled to, you are overpaying the government
with your hard earned money." Western Canadians were more likely to claim new
tax credits.

Politicians wonder why they get little if any credit for the tax cuts they make. Maybe it's because very few people are aware of them. It's time for a lower, simpler, flatter tax system.

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