Liberal leadership candidate Scott Brison has proposed a package of tax reforms that would include giving young Canadians a big tax break, which would allow them to earn up to $25,000 tax free each year in their first 12 years of full-time work.
Calling the Harper government's GST cut "the dumbest tax cut possible," Mr. Brison said he would not repeal the cut to 6 per cent from 7 per cent that took place on July 1, but he would not allow the government's proposed second GST cut to 5 per cent.
Rather, he said in a speech in Toronto yesterday that he would use the money for a "working income-tax benefit" that would help low-income Canadians "escape the welfare trap." He said the benefit would cost about $5-billion and be mostly covered by not having to lower the GST another percentage point.
Mr. Brison used his speech yesterday to unveil a six-point plan for the Canadian economy.
"Right now in Canada it's bad economic and social policy that somebody who chooses to go from social assistance to a low-wage job ends up making less money," he said in an interview about his proposal for a working benefit.
He said he believes his benefit would help people "climb over that welfare wall." Mr. Brison, 39, is the youngest of the 10 contenders in the race to replace Paul Martin. A former investment banker who started his first business renting mini-fridges at university, he also served as a senior minister in the Martin government.
He said that his plan to allow young Canadians to earn $25,000 tax free yearly in their first 12 years of full-time work after graduating from university or college would make Canada a more attractive place for young people.
Canadians are now allowed to earn only $8,840 yearly before being taxed. Mr. Brison said his tax credit would give young people some help as they try to "pay off student debt and start their careers and families." He said the plan would be revenue neutral because the tax break would keep young Canadians in Canada and also hopefully attract young people from outside of the country to start their careers here.
In addition to the tax reductions and changes, Mr. Brison's plan focuses on a long-term strategy to make Canada a "global leader in clean energy." He also looks at immigration issues, proposing that the accreditation process for foreign credentials be revamped so that it begins in the country of origin.
"Instead of them arriving here and having to start at square one . . . other countries like Great Britain have moved to this type of model and it enables a professional . . . an engineer in India to start to his or her professional accreditation in India so that by the time they arrive in Canada they either are accredited or on the way to being accredited," Mr. Brison said.
Mr. Brison and the nine other leadership candidates will be in Vancouver Sunday for the second-last leadership debate before the convention in Montreal in late November and early December.