The Table below provides cost estimates for most of the Liberal election promises as of September 1. In some cases, it has not been possible to provide estimates since not enough detail has been provided.

Panel 1 summarizes the announced Liberal commitments, including the middle-income tax cut, increased funding for childcare and for the environment – the latter was only partially costed. In addition, they have promised increased support for Aboriginal programs; the most important being a commitment to eliminate significant “gaps” between Aboriginal and non-Aboriginal Canadians.

 

Recently they have announced a number of initiatives to provide increased support for veterans at a cost of $300 million annually. One of these initiatives relates to providing injured veterans the option of a lifetime pension.  The fiscal impact of this future liability would be booked in 2015-16.The announcement of a new infrastructure initiative is also included.

 

Panel 2 provides estimates of how the Liberals plan to pay for their election promises. The Liberals have indicated that they would eliminate the Conservative promise of income splitting for families with children under eighteen and introduce a new tax rate for anyone earning over $200,000.  They have also indicated that they would keep the maximum annual contribution to the TFSA at $5,000.

 

Panel 3 provides an estimate of the net impact of the proposed spending and revenue increases on the post election budget

balance. 

 

	2015-16	2016-17	2017-18	2018-19	2019-20
($ millions)
1. Uses of Funds
Reduce 22% tax to 20.5%	750	3,000	3,000	3,000	3,000
Canada Child Benefit	1,000	4,000	4,000	4,000	4,000
Environmental Plan		416.5	416.5	416.5	416.5
Support for Aboriginals		715	850	900	800
Compassionate care benefit		190	190	190	190
Increase support for veterans	?	300	300	300	300
Tax credit for school supplies	60	60	60	60	60
New infrastructure spending		5,100	5,100	3,600	3,600
Total Uses of Funds	1,810	13,781.5	13,916.5	12,466.5	12,366.5
2. Sources of Funds
Cancel income splitting	499	1,995	2,050	2,100	2,165
Introduce fifth bracket	750	3,000	3,000	3,000	3,000
Reduce TFSA limit to $5,500	85	160	235	295	360
Total	1,334	5,155	5,285	5,395	5,525
3. Net Impac	-476	-8,627	-8,632	-7,072	-6,842