Monday, January 19, 2009

Liberals won't back tax cuts

The Harper government will present its budget next week. The NDP and the Bloc have announced that Stephen Harper has lost the confidence of the House and they will vote against the budget. The Liberal Party under Michael Ignatieff hasn't made up its mind about whether Harper can continue to govern even if all the other parties don't trust him. But the Liberals seem to be clear on one thing; according to today's Toronto Star, Liberals won't back tax cuts.
The Liberals are opposed to making tax cuts the centrepiece of the budget, and new leader Michael Ignatieff signalled yesterday the party is prepared to dump the Conservative minority if the budget is inadequate.


As they position themselves in advance of the budget, the Liberals argue that, while they generally favour income-tax cuts, it's the wrong approach during the recession.

"We don't want to see the Prime Minister come up with the kind of broad-based tax cuts that put Canada in a permanent, structural deficit once we recover from this (recession)," Liberal finance critic Scott Brison (Kings-Hants) told CTV yesterday as his party gathered in Ottawa for the caucus meeting.

Liberal MP John McCallum said such cuts are fiscally irresponsible at a time when the Tories have already put Ottawa's books in a deficit position and there's no way to ensure tax cuts benefit those who have lost their jobs or otherwise need help during the recession.

"There's a very good argument to be made that this is not the right time for across-the-board tax reductions," said McCallum, MP for Markham-Unionville and chair of a party advisory committee on the economy.
This could get interesting. I would support the Liberals if they vote against the budget because it contains significant tax cuts. Cutting taxes is typical conservative dogma so we may be headed for an election.

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