How do they compare? In his published notes for his speech ”The Next Step Towards a Stronger Economy”, Alliance leader Stockwell Day said he would “move immediately to reduce the top and middle income tax rates from their 29 and 26% to 25 and 23%. This would give more incentive to middle and upper income earners who question the value of working overtime or getting raises if it just knocks them into a higher tax bracket.” Later, in the same speech, he explained that this and other proposed tax measures “are simply the first steps along the way towards a single rate system, which we believe can be as low as 17%.” (Notice he doesn’t promise either that a single flat tax system will be implemented, or that if it was, it would be 17%.)

In the Liberal Platform, the Liberals claim to have already reduced taxes considerably, reducing personal income taxes for Canadians on average by 27%, and up to 35% for families with children, since the elimination of the deficit (p. 4). They further promise to reduce the top tax rate of 29% to 26% for incomes ranging from $60,000 to $100,000 and eliminate the deficit reduction surtax; reduce the middle tax rate of 24% to 22% on incomes ranging from $30,000 – $60,000; and to reduce the bottom tax rate on incomes less than $30,000 from 17% to 16%, all as of Jan 1, 2001 (p. 5). (If you’re wondering why the Alliance and Liberals middle tax rates are different, it’s because the Liberals reduced the middle tax rate from 26% to 24% in 2000.)

The Progressive Conservatives prefer to speak in terms of exemptions rather than tax rates. In their Progressive Conservative Policy Summary, they promise to raise the basic personal exemption from the current level of $7,231 to $12,000 by 2005, and increase the married and equivalent spouse amount to $12,000 by 2005, which would mean that “a single earner family would not pay income tax until their income reached $24,000 per year”.

The NDP have no specific general tax cut promises in their platform.

Looking solely at income tax rates, then, the Alliance and Liberals appear to be promising the most relief if you’re a sole proprietor or partner. The Alliance may have the edge if they can make their promise of a 17% flat tax more than speculation. If they were able to deliver on this, why wouldn’t they already have said so? Decision day is looming.

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