We’re working on our taxes this month and Devon’s been helping. As it turns out, having a child changes everything when it comes to taxes and politics.
Shauna and I grew up on the fringes of political discourse: young people don’t vote and have little economical power, so most of the major parties ignored us. We also like trees and riding our bicycles, so people like us are typically sidelined in favour of truck drivers, baby boomers, and oil and gas executives. However, ever since we got married and had Devon, every single political party has been pandering to us constantly. We are now “hard-working parents,” “real experts on families,” pillars of society.
The conservative government went as far as to introduce a Family Tax Cut to further pander to us. “Save up to $2000,” they said. We felt important. 2014 is the year we were both partially off work to look after Devon, and some additional money in our pockets would’ve been welcome. If there is any “typical” family that should have qualified for the tax cut, it would be ours: two working parents, earning typical wages, and taking turns working and looking after a newborn baby.
We just finished completing our taxes — a hard-working family like ours saved $57 in tax due to this measure. “Congratulations!” said the tax preparation software. “Really?”, we said.
In real life, the Family Tax Cut does absolutely nothing to help a family like ours. And it’s not just our family. The non-partisan budget watchdog found that only a minority of families benefit from this tax cut, and these benefits go largely to high-income families. Everybody who has analyzed the numbers concluded that this is a regressive tax where people with higher incomes benefit the most.
Who benefits the most? Families like Stephen Harper’s, where one high-earning spouse (typically the husband) works full time and the wife stays home to look after the kids.
Who benefits the least? Single parents. Families like ours where both parents are working and earning similar amounts. Typical families where parents are earning average wages.
From our experience, it’s easy to conclude that this tax cut is deeply unfair and divisive: it increases the income disparity instead of decreasing it by allowing people who are already wealthy to shelter an entire average $50,000 salary from tax. People who are already wealthy already have other methods of sheltering income from taxation such as spousal RRSP contributions which are effectively an income-splitting strategy. They don’t need additional help to protect more of their income.
However, families do need help especially when they have young children: daycare, transportation, and childhood activities are expensive. But this tax cut does nothing to help families who need the help the most. What would really help? Universal daycare. More trees and bike lanes. Better public infrastructure so we don’t need to buy a second car.
But it’s not just the financial unfairness of the Family Tax Cuts that bothers us. This tax cut is also socially regressive, as this article clearly argues. Shauna and I wanted to have an equal marriage where we are both engaged and successful both at home and in our careers. That’s why we opted to share the parental leave equally and contribute equally to Devon’s upbringing.
We want most of all to show Devon through example that both men and women can raise a family, contribute to society, and be good caretakers of our environment. This tax cut rewards the exact opposite behaviour: it removes women from the working world and returns them to the traditional role of homemaker; it insists that the mother’s place is at home as opposed to contributing to society at large; and ultimately it removes economic power from women:
Income-splitting also would reinforce the dominant role of men in relationships. The income-splitting itself is for tax purposes only. There’s no actual transfer of money to the lower income spouse (typically the woman), so it will do nothing to increase her autonomy or bargaining power within the relationship.
It would, however, increase her personal tax rate if she decided to go to work — thereby discouraging her from doing so….
And the $2,000 benefit can only be claimed by someone paying tax, so in a ‘traditional’ family it would typically go to the man — who may or may not choose to share it.
There are so many things wrong with the Family Tax Cut that we feel that our family can only support the political party who will repel it and replace it with something that helps everyone, like universal child care. Luckily, this is an election year, and this time we’re also planning to vote.