New Tax Reduction for Low-Income Individuals and Families

Loyola Sullivan, Minister of Finance, today announced in Budget 2004 that government will implement a personal income tax reduction for low-income individuals and families beginning with the 2005 taxation year.

"This initiative is a major step forward in our efforts to achieve the lowest rate of poverty in the country. It will put approximately $5.3 million back into the hands of those who need it most, low-income families and individuals, including students and minimum wage earners," said Minister Sullivan. "Government recognizes that our economic and social policies must go hand-in-hand. When our citizens have more money to spend on goods and services, it generates economic activity which, in turn, benefits the province and all residents."

With this program, a low-income individual may save up to $416 in provincial income tax, and a family may save up to $464. Provincial income tax will be eliminated for individuals with net income up to $12,000, and partially eliminated for individuals with net income up to $14,600. For families, provincial income tax will be eliminated on family net income up to $19,000, and partially eliminated on family net income up to $21,900.

For purposes of this program, the family credit may be claimed by a person who is eligible to claim a non-refundable credit amount for a spouse, common-law partner or an eligible dependant (equivalent to spouse).

Media contact: Diane Keough, Communications (709) 729-6830

2004 03 30                                    2:50 p.m.