Senators’ attempt to change tax bill falls flat

Speaker George Furey ruled unelected senators don’t have constitutional authority to rejig tax brackets

OTTAWA – A bid by the Senate finance committee to amend the Trudeau government’s signature income tax bill has been ruled out of order.

Speaker George Furey has ruled that unelected senators don’t have the constitutional authority to rejig the tax brackets in Bill C-2.

The bill delivers on Prime Minister Justin Trudeau’s campaign promise to reduce the tax load for the middle class while making the wealthiest pay more.

It formalizes changes to income tax brackets that actually went into effect last Jan. 1, when the fledgling Liberal government reduced the tax rate to 20.5 per cent from 22 per cent on income between $45,000 and $90,000 and imposed a new tax rate of 33 per cent on income above $200,000.

Last week, the Senate finance committee approved an amendment which committee chair Larry Smith said would better target the tax savings at middle income earners who need it most.

Smith, a Conservative, proposed to set a rate of 16.5 per cent on income between $45,000 and $53,000, with the 20.5 per cent rate applying from there up to just over $90,000.

Finance Minister Bill Morneau called it “surprising” that senators would change a bill that implements a change specifically promised in last year’s election campaign. And he left little doubt that the government would reject any Senate amendment.

Looking for more?

Get the Best of Maclean's sent straight to your inbox. Sign up for news, commentary and analysis.