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It's Fair to Share - reducing taxes in Canada by sharing income

Conference over- here are the highlights
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We had a wonderful experience in Ottawa, bringing together speakers from across the country, heard by MPs and senators and welcoming many from the public to share ideas.

This was a great tribute to democracy, and how grass roots movements can be brought right to the Hill.

It was in addition a tribute to unpaid labor. The conference received no government or corporate funding and happened due to the donations of a few and the willingness of the many to work for free.

Highlights of Conference on Income splitting

Ottawa Jan 30 2007

Hosts: Sara Landriault, Beverley Smith

MP Host: Garth Turner, MP

Introductory remarks: Garth Turner

Introductions of speakers: Sara Landriault

Overview of the Issue:

Beverley Smith outlined the 100 year history

of how to value unpaid labor and

made historical reference to incomesplitting,

deductions for spouse or children,

guaranteed annual income, wages for housework,

pensions for unpaid work and other proposals

in Canada and in other nations. Copies of

her longer papers on the international practice

of incomesplitting and on the history of

tax policy for unpaid work in Canada are available

through her at

Economics Panel

Dr. David Murrell , economics Professor at UNB

Dr. Murrell noted inequities in taxation of equal

earning households and pointed out the benefit

to society of those who are raising children He

looked at issues of drop in birth rate and examined

estimates made by TD Banks Don Drummond of

the cost of income splitting. He examined the

argument that such a move would benefit the rich,

examining options to exclude them or to enhance

personal deductions, or spousal tax credits including

suggesting raising the spousal deduction to

$12,000 to value the work of the unpaid caregiver.

Dr. Murrells paper is available to the press and

public through him at

John Williamson, Canadian Taxpayers Federation

Mr. Williamson quoted Senator Phil Graham of

the US who countered a claim that government

cared as much as he did about his children, saying

Really. And what are their names? He argued that

parents are best qualified to know what is in the childs

best interest and examined cost estimates of the

incomesplitting proposal, noting that right now

the top 10% of earners, earning over $64,500,

pay half of the federal tax revenue. He revealed that

82% of Canadians earn under $50,000 a year

and examined how income splitting would benefit

that sector and how that sector is not in practice

wealthy. He illustrated current tax penalties for

households of various incomes and how income splitting

would reduce their tax burden. He went on to point out

his organizations endorsement of broadbased

tax relief and a single tax rate as in Alberta to correct

some of the current inequities

Dr. Philip Merrigan, economist at UQAM

Dr. Merrigan examined in detail the French system of

income splitting which permits households with and

without children to in the end have nearly identical

standards of living. He examined by contrast the current

child tax benefit in Canada, which is small. He outlined

parental allotment systems such as in France which have

led to a birth rate of 2, in contrast to Canadas of 1.5

He then examined the Quebec system and its unequal

benefit for those who do and do not use subsidized

childcare, outlining how government help to those

of varying incomes is inequitable. He observed that

in Quebec income splitting would be beneficial. He then

outlined philosophical bases for social policy, noting that

of Finland and looked briefly at pension options for

valuing unpaid caregiving.

Caregiver Panel

Kathy Graham of the Assoc of Daycare Care Operators of Ontario

Ms .Graham spoke as an advocate for care of children and as a single parent.

She noted current inequalities where the selfemployed are excluded

from many benefits including CPP and pointed out that the care profession is

itself lowpaid. She outlined how inequities where the deduction for a child is

insensitive to the age and costs of raising a child and that a child

is not equivalent to spouse in terms of financial contribution

to the household.

John Toft of the Harmony Centre for Community Living and the Families

Matter Cooperative Inc, spoke as a parent of a child with autism.

He pointed out the effect on his household income and the career

trajectory of his wife after the diagnosis of autism of their child. He noted also

the impact on their social life and mobility, and on their pensions

of the commitment they had made to provide care of their child.

He outlined how income splitting would benefit those in such


Caroline TappMcDougall of the Canadian Occupational

Therapy Foundation and writer of The Complete Eldercare

Guide spoke of her experience with elder care and the

financial impact on households which have this


Political and Legal Rights Panel

Elizabeth May, leader of the Green Party of Canada and

past executive director of the Sierra Club of Canada

examined tax policy from the point of reference of Jane

Jacobs about the importance of family and community.

She cited the problem of time stress and the value of

the informal economy and outlined how current policy

has led to a drop in participation in the volunteer sector.

She argued that income splitting would be one way to

address some but not all current social problems and

that it had great merit. She said the cost of such

a proposal might be more bearable if there was less

financial help from government to large corporations

She also urged further discussion of other promising

proposals including longer maternity leave and

guaranteed annual income, more paid holidays

Rebecca Bromwich, law professor at Fanshawe College

and law lecturer at UWO examined misperceptions that

the discussion of income splitting was only to benefit

stayathome mothers, noting that it would in fact reduce

tax for any household that shared income. She quoted

Nellie McClung about the underreporting of the

pleasure women take in caring for their children and

examined how the significant number of people

doing care roles requires that we address their needs

too. She noted current inequities of tax benefits

for the selfemployed regarding maternity leave and

noted that it is still predominantly women who do the care role.

She examined the Supreme Court case of Moge in 1985

where the court ruled that formal equality on paper was

not sufficient when a marriage ended because the court

must also look at what was practicable. She pointed out

how family law has progressed and pointed out how the

advance of womens rights had itself enabled a discussion

of the value of unpaid work.

Copies of her paper are available through her at

We welcome a continued discussion of how to value unpaid labor. Income splitting is a vital part of this discussion and we need to also look at raising spousal deductions, universalizing maternity, parental and palliative care benefits, delinking care benefits from EI, increasing and universalizing child tax benefits to much older children, pension credits for unpaid care years, single rate tax and others of the suggestions of our very well researched speakers.

The point of the discussion is to recognize that taxation should be fair, should be based on actual practice of who earns and how far the income has to spread and on the basic tax principle that taxation must depend on ability to pay tax.

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