Harper: We'll go ahead with income-splitting

Prime Minister Stephen Harper has said the Conservatives will go ahead with income-splitting, which was promised in the last election once the budget was balanced — something that is only happening now. If implemented, income-splitting would allow couples with children under 18 to split up to $50,000 of their income for tax purposes. This would reduce the household’s overall tax bill.

Flush with an estimated $6.4-billion budget surplus, the Harper government plans to use its next budget to dangle tax cuts in front of voters in advance of an election expected in the fall of 2015.

The proposal, which would cost $3 billion annually in foregone revenue, would benefit only about 1.8 million households and be most valuable to those where one spouse stays home while the other brings in above-average income.

The fairness of the plan has been widely questioned, including by former finance minister Jim Flaherty. ■