Federal Budget opinions

[still_bluenoser]

Looks like a really good budget to me, I really like the new tax free savings incentives, and seniors income splitting actually coming into effect.

Of course, if you are Block or NDP, you didn't like it before you even heard it. I guess they have special powers

[Hedley]

What I though was bizarre was that the Liberal
caucus was meeting today, to decide whether
or not to vote FOR the budget, or abstain.

I thought as an opposition party, abstain
would have been a no-brainer ... why on
earth would they vote FOR the budget?

The outcome is the same either way, and
don't they look like idiots in opposition if
they vote FOR the budget, which is saying
that they think the gov't is doing a great job,
which means they should stay in opposition?!

[Dust Devil]

I think it's a winner. I'm pretty happy about it. Wait till people start earning tax free income after maxing out contributions over the next few years. It may not be much now but after 10 years of contributions it's going to be pretty sweet.

[CID]

It's a pretty ho-hum budget. After lambasting the Liberals for even thinking about paying down debt with a huge surpluses, the Conservatives are doing just that. Where's all the outrage about giving the surplus back to the taxpayers? Where's all the outrage about overtaxing?

Furthermore that $5000 "tax free" bank account is going to save you under 50 bucks a year per 5K investment. Unless you geniuses haven’t figured it out yet, the money you store in the special account has already been taxed. All you are relieved of is paying tax on the interest. This incentive is only useful for the “well off” who have maxed out their RSP contributions who would probably invest their money somewhere with a higher return anyway.

How about the Conservatives just give me back my portion of the 10 billion they overtaxed me for?

As usual this budget offers nothing for the middle class whose shoulders the economy rides on.

As far as the Liberal support, they would gain very little in forcing a election for ANY reason right now. They would surely not regain power and may be handing the Conservatives a majority government.

[Dust Devil]

How about the Conservatives just give me back my portion of the 10 billion they overtaxed me for?

How about you pay back the debt that your generation created before asking for your money back.

[CID]

How about you pay back the debt that your generation created before asking for your money back.

That statement shows just how little you know DD. Tsk tsk.

[v6g]

Furthermore that $5000 "tax free" bank account is going to save you under 50 bucks a year per 5K investment. Unless you geniuses haven’t figured it out yet, the money you store in the special account has already been taxed. All you are relieved of is paying tax on the interest. This incentive is only useful for the “well off” who have maxed out their RSP contributions who would probably invest their money somewhere with a higher return anyway.

It was my understanding that this tax break would apply to other investments (stocks / bonds) - not just cash. Maybe I'm wrong?

[CID]

It was my understanding that this tax break would apply to other investments (stocks / bonds) - not just cash. Maybe I'm wrong?

The government speaks of depositing the money in a "special" account. I don't know for sure, but that doesn't sound like there's alot of wiggle room. If you have more information, I'd like to hear it.

[hydro]

It would be a special account similar to an RRSP. I.e. financial instruments eligible to be held in an RSP would be eligible to be held in the Tax Free Savings Account (stocks, bonds, mutual funds, etc)

The 5k doesn't mean all that much tax savings in 2009, but in 10, 20, + years, it will add up. 50k - 100k+ a person or 100-200k+ a couple will be a nice chunk to have tax free in later years.

[Dust Devil]

can't argue with a colts fan

[still_bluenoser]

Furthermore that $5000 "tax free" bank account is going to save you under 50 bucks a year per 5K investment. Unless you geniuses haven’t figured it out yet, the money you store in the special account has already been taxed. All you are relieved of is paying tax on the interest. This incentive is only useful for the “well off” who have maxed out their RSP contributions who would probably invest their money somewhere with a higher return anyway.

As usual this budget offers nothing for the middle class whose shoulders the economy rides on.

This account gives you the same great tax return the year that you allot the money to that account as putting it in an RRSP, which is a HUGE savings upfront instead of putting it in a normal savings account.
The difference in putting it in this new account and an RRSP is that the interest income that you earn over time is not taxed when it the money is withdrawn from the account.
Yes, those with the money to invest in the volatile markets will likely still use an RRSP for the higher gains, but for those with very little to fall back on and would likely NOT take the plunge into RRSP's, this is a more stable option that they could take advantage of.
This account is great for the middle classer that wouldn't have otherwise saved that money.

[CID]

This account gives you the same great tax return the year that you allot the money to that account as putting it in an RRSP, which is a HUGE savings upfront instead of putting it in a normal savings account.

From what I understand its NOT like an RSP which is income tax exempt until you withdraw it. Therefore there would be NO savings up front.

http://www.thestar.com/News/FederalBudg ... cle/307252

Savers would not enjoy tax refunds for income deposited into the tax-free accounts, and would be limited to saving $5,000 a year, with periodic adjustments to keep pace with rising prices and incomes.

But the savers would not pay taxes on the investment income, or see federal government pensions or tax credits clawed back because of withdrawals. This would allow savings to grow faster and go farther.

These flexible, multi-purpose, registered accounts would not arrive until 2009, and only then if financial institutions got behind the idea.

So what segment of the population will benefit? Many say "seniors" but I think that more accurately, "wealthy" seniors would benefit.

[Dust Devil]

How is this a predominantly seniors program? I see this benefiting young families such as mine who have a tax free place to stick our money and in 10 20 or even 30 years be able to have substantial savings earning a healthy buck tax free. What is wrong with that?

[grimey]

This account gives you the same great tax return the year that you allot the money to that account as putting it in an RRSP, which is a HUGE savings upfront instead of putting it in a normal savings account.

From what I understand its NOT like an RSP which is income tax exempt until you withdraw it. Therefore there would be NO savings up front.

The account gets earnings from capital gains and interest exempted, not the initial investment. You don't get a tax deduction like you do with an RRSP, but you don't pay capital gains on what you've invested in through the account. So yea, you save money in the long run, not up front.

/grimey is not a financial advisor

It's a boring, safe budget that doesn't do much except make the Liberals look useless by not taking down the government... again. Dion keeps complaining about how bad a job Harper and his cabinet are doing, but seems to be totally unwilling to actually call them on it. What's the longest a minority government has been in power, anyway?

[CID]

How is this a predominantly seniors program? I see this benefiting young families such as mine who have a tax free place to stick our money and in 10 20 or even 30 years be able to have substantial savings earning a healthy buck tax free. What is wrong with that?

The average "young" family doesn't have $5K sitting around to invest in such a lackluster account if they've already maxxed out their RRSP contribution which by the way can be quite flexible. (high, moderate or low risk) Rich young families might have the $5K but rich young families wouldn't put money in such lackluster investments either.

As for the elderly, the article states:

Those who have taxable accounts today could simply convert them to tax-free accounts. The government expects half of tax savings to go to seniors, who have the most savings in unregistered accounts and who must start to take withdrawals from retirement plans after turning 71.

Believe me, that doesn't apply to a senior who lives off her pension and has no significant savings. So, like I said, it will help wealthy seniors.

The middle class is getting shafted again.

[still_bluenoser]

The average "young" family doesn't have $5K sitting around to invest in such a lackluster account if they've already maxxed out their RRSP contribution which by the way can be quite flexible. (high, moderate or low risk) Rich young families might have the $5K but rich young families wouldn't put money in such lackluster investments either.

is the 5k not a yearly limit? You can deposit as much as you can up to that limit?

[hydro]

The 5k is a yearly limit, and yes it does carryover even if you don't use it initially. So in 5 years, even if someone didn't use the TFSAat all, they will now have a limit of 25k.

hydro

[Dust Devil]

The average "young" family doesn't have $5K sitting around to invest in such a lackluster account

Do you have any info to back this up? I'd be interested to see the stats on people with normal savings accounts. Would this not be a good alternative to a standard savings account?

I'm curious CID what would you have liked to see in the budget. Once again all we hear is bitch bitch bitch but really no ideas to speak of. What is your magic formula to fix the world?

[pika]

Is this for real? People are excited about "tax free" on $5 000? Once your RRSP's are maxed out where the hell are you going to get an extra $5 000? Your line of credit? I still have no idea how anybody can afford to live in Canada.

[the_professor]

How about the Conservatives just give me back my portion of the 10 billion they overtaxed me for?

How about you pay back the debt that your generation created before asking for your money back.

The $400B national debt accumulated over decades past will not evaporate, and the sooner we get rid of it (or reduce it to a fraction of its current size), the better.

Canada currently spends $83 million PER DAY servicing that debt!

Let's just be glad we're not the Americans, with their $9 Trillion (and growing) national debt...

[the_professor]

It's a boring, safe budget that doesn't do much except make the Liberals look useless by not taking down the government... again. Dion keeps complaining about how bad a job Harper and his cabinet are doing, but seems to be totally unwilling to actually call them on it.

Boring, except for the $750M icebreaker. That'll be pretty cool.

This is third confidence motion in a row where Dion has chosen to stick his head in the sand. Say what you want about Harper, but nobody can deny that he is a far stronger leader than Dion. Dion is starting to make an embarrassment of himself and the party. The knives will be out for him before long.

Grimey's point/statement is being reflected in the polls, and the Liberals' credibility suffers with each passing day.

[CID]

I'm curious CID what would you have liked to see in the budget. Once again all we hear is bitch bitch bitch but really no ideas to speak of. What is your magic formula to fix the world?

So we're fixing the whole world now are we DD?

What I'd like to see is some tax relief for the middle class. Adopting a mortgage interest deduction similar to the American system would be a good start. This would help Canadians pay their mortgages off sooner. It also targets the all important middle class and has the potential to stimulate the economy as these people direct their money directly back into the community rather than into the banks coffers.

And how about addressing some of the biggest drains on the economy? Like Northern and Indian Affairs? And how about we put more money into incentives that would transform our energy base from the expensive and environmentally damaging fossil fuels to alternative energy sources?

This lackluster smoke and mirrors budget not only offers no significant incentives or programs to Canadians, it is contrary to the very principals that form the basis these jokers were elected on.

Reducing the GST was retarded too. Why would a government who is suggesting Canadians "tighten" their belts, stimulate more spending by reducing a consumption tax? Remember when Chretien was criticized by the "right" when he "promised" to remove the GST altogether? It looks like Harper adopted Chretien's bad idea.

This is third confidence motion in a row where Dion has chosen to stick his head in the sand.

What would defeating the government achieve for Dion? A majority government for the Conservatives? The Liberals are struggling in the polls. Dion is an ineffective leader. The party in shambles and arguably on the brink of becoming as insignificant as the PCs were post Mulroney. He would be an idiot to cause parliament to be dissolved at this point in time. Especially if Harper managed to hypnotize many more Canadians like DD.

[Hoov]

The average "young" family doesn't have $5K sitting around to invest in such a lackluster account

Do you have any info to back this up? I'd be interested to see the stats on people with normal savings accounts. Would this not be a good alternative to a standard savings account?

I'm curious CID what would you have liked to see in the budget. Once again all we hear is bitch bitch bitch but really no ideas to speak of. What is your magic formula to fix the world?

I agree with CID there are a lot of families out there that don't have 5k to put away. I dont have it now, and growing up I don't think my parents did either.

[still_bluenoser]

[quote="CID"][quote]The average "young" family doesn't have $5K sitting around to invest in such a lackluster account if they've already maxxed out their RRSP contribution which by the way can be quite flexible
[quote]


You are still assuming that everyone feels comfortable using RRSP's. This is for the people who do not want to invest in RRSP's and have savings accounts.

[CID]

You are still assuming that everyone feels comfortable using RRSP's. This is for the people who do not want to invest in RRSP's and have savings accounts.

Yep. Intead put your money in a "special" savings account set up by the government.