Andrew Scheer’s Conservatives are proposing to run a deficit of $23 billion next year if they are elected and promise a return to balance in five years with a surplus of $667 million by 2024-2025.
The Conservatives released their full platform, over 100 pages, Friday afternoon that contains an array of new spending and tax relief measures that amount to $6.2 billion in 2020-21 and a combined $49 billion over five years.
The Tories are promising a series of tax breaks, including their previously-announced “Universal Tax Cut” costed at $20 billion, which drops the tax rate on the first $47,630 of income from 15 per cent to 13.75 per cent. Their platform also contains previously-announced Harper-era tax credits for transit passes, as well as children’s fitness and arts programs.
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Other major spending promises include a non-refundable tax credit on maternity and parental leave Employment Insurance (EI) benefits costed at $4.6 billion and a pledge to remove the federal GST from sales of home heating fuels estimated at $6.7 billion.
They are planning to finance their big ticket items with savings of $6.4 billion next year that rise to $17.8 billion in the fourth year of their mandate and amount to a combined $67 billion over five years.
The Conservatives are counting heavily on trimming government expenses to meet their balanced budget targets. Among some of the major proposed cuts include $18.1 billion in “prioritized infrastructure spending” over five years, $14 billion over five years in “other operating expense reductions” without providing any details and closing tax loopholes which account for $11 billion over five years.
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Their platform also outlines cuts to corporate welfare and foreign aid that would total $15 billion over five years. The Tories previously released a cost estimate from the Parliamentary Budget Officer (PBO) for the proposed corporate subsidies cut, however the PBO was unable to evaluate the proposal due to a lack of details.
With this platform, the Conservatives are contrasting themselves against the Liberals as the more fiscally-responsible party while helping Canadians “get ahead.”
“I believe our best days are still ahead, but we have to change course now,” Scheer said at an event Friday in Tsawwassen, B.C.
“I hear it everywhere I go. Everything is getting more and more expensive, there is less and less money at the end of the month.”
Asked about the cuts to pay for a balanced budget, Scheer reiterated his promise not to slash any core services.
“We are committed to increasing the transfer payments for health, education and social programs. That is a guaranteed,” he said. “We’ve said where we’re going to get the money from. We’re going to get it from corporate welfare; we’re going to get it from foreign aid.
“We’re going to make sure that government real estate is allocated responsibly, so the government is wasting money with empty office space all over the country.”
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Justin Trudeau’s Liberals have projected a $27.4-billion deficit next year with no immediate return to a balanced budget. Some of their major promises include making the first $15,000 of income tax free, maternity and parental EI benefits tax-free at source, and increases to the Canada Child Benefit.
The Grits are instead promising smaller deficits and a steady decline in federal debt-to-GDP ratio from 30.9 per cent in 2020-2021 to 30.2 per cent in 2023-2024.
On Friday, Trudeau criticized Scheer for releasing his platform after the first day of advanced polling had started.
“Now the Conservatives are finally saying that they might release a fully-costed platform later today,” Trudeau told Liberal supporters in Ottawa on Friday morning. “The reality is — and I think we all know it — you don’t release your best work at 6 o’clock on a Friday.”
Trudeau said that the Conservatives were releasing the platform “in secret” to avoid attention on $53 billion in cuts included in their budget.
“We’ve seen very clearly, Conservatives are proposing deeper cuts than Doug Ford has proposed,” he said.
The NDP, who also released their platform Friday, are proposing to run a deficit of $32.7 billion next year, with no plan to return to balance.
They are planning $35 billion in new spending next year that includes $10 billion for pharmacare, $5 billion for building new affordable homes and $1.8 billion for ending boil-water advisories for Indigenous communities.
New revenues would largely come from businesses and wealthy Canadians, including $8 billion from increasing the capital gains rate to 75 per cent, $6.3 billion from increasing the corporate income tax rate by three percentage points, $5.8 billion from cracking down on tax havens and $5.6 billion from a tax on the ultra-wealthy.
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The PBO has rated some of these revenue proposals as “high uncertainty” including their super wealth tax.
The party says its plan still projects Canada’s debt-to-GDP ratio fall over that time period.
Meanwhile, Elizabeth May’s Green party has released a platform that projects $62.2 billion in new government revenue and $69.9 billion in “spending changes” in 2020-21, with an overall $22.7 billion deficit. The party claims that it will run smaller deficits until it reaches a $401 million surplus by 2023-24.
The Institute of Fiscal Studies and Democracy (IFSD) at the University of Ottawa originally gave the Greens a failing grade when it comes to realistic economic assumptions, responsible fiscal management, and transparency. A later revised platform received a passing grade after the Greens provided more information about their fiscal projections and platform costing.
— With files from David Akin