Northern tax relief still not a done deal
MP McLeod says promised 33 per cent increase should be introduced in Liberals' first budget
John McFadden
Northern News Services
Friday, December 18, 2015
SOMBA K'E/YELLOWKNIFE
It is still not clear whether a promised increase in the Northern Residents Tax Deduction will take effect in time for NWT residents to benefit from it on their 2015 tax return.
Prime Minister Justin Trudeau made a campaign promise to increase the benefit by 33 per cent during a trip to Yellowknife about a week and a half before the Oct. 19 federal election.
According to NWT MP Michael McLeod, the benefit will likely be announced when the Liberals deliver their first budget in the New Year, probably in February. McLeod said he and his two territorial counterparts, Yukon MP Larry Bagnell and Hunter Tootoo from Nunavut have been pushing to make sure the increase gets done as soon as possible. However, he said he has received no confirmation from either Finance Minister Bill Morneau or Trudeau as to exactly when the benefit will kick in.
"We would like it to be in the first budget but we have not received confirmation that it's going to happen. (Morneau) hasn't indicated (a timeline) until he has gathered more information," said McLeod. The rookie MP said he has invited Morneau and his parliamentary secretary to the NWT to get feedback from residents on the tax break and the high cost of living in the North. He said he is cautiously optimistic the visit will take place early in the New Year, perhaps as early as the second week of January, but again details of that trip have yet to be worked out.
McLeod acknowledged the tax deduction was a major part of Trudeau's Northern platform during the campaign and very likely played a key role in the Liberals' sweep of the three Northern territories during the election.
Yellowknifer asked McLeod what he would say to his constituents who may be leery of campaign promises in general and a little impatient on this important promise in particular.
"We're working on it. We have raised it individually with the finance minister. We've raised it as a Northern caucus. I think that the message is being heard," McLeod said.
Even McLeod admits calculating the tax deduction can be a little complicated. Essentially, NWT taxpayers, who have lived full-time in the territory for the previous six months, can claim $8.25 for each day in the taxation year that they lived here and an additional residency amount of $8.25 per day if they are the only person in a household claiming the residency deduction.
That means the maximum allowable deduction is $16.50 a day. McLeod said that number is expected to increase to $22 a day once the increase takes effect.
"This benefit will also be indexed to keep pace with inflation," McLeod said. "They'll use the rate of inflation that is accepted by Revenue Canada. There is a rate of inflation used by Revenue Canada but I don't know what it is at this point.
McLeod said he is encouraged that both a Northern caucus and an aboriginal caucus are taking shape on Parliament Hill. He said having MPs united with common causes and goals makes it a little bit easier to have their voices heard.
