Is the Novelty of the UCCB Wearing Off?
There certainly was a lot of hoopla made by the conservative government for the introduction of the Universal Child Care Benefit (UCCB). This week the “we did good” pot was stirred with the promoting of the $3 billion lump sum payments for this benefit.
Families who were eligible should have received their first seven months of payments recently. This would have amounted to $420 ($60 x 7 over 5 years old) or $520 ($60 x 6 + $160 for 5 year old and under) per child. Many taxpayers were overjoyed to receive this and the employment minster equated it to Christmas in July.
The receiving of a sum of money like this serves the purpose of squashing the downfalls that come with this new benefit, at least until the money is spent. What many are not momentarily realizing is that that this UCCB replaces a previous tax credit. This was the $2,255 child tax credit, which gave $337.50 per child. So now realistically lets deduct this from the new UCCB amount. Also, it has to be realized that the UCCB is taxable both Federally and Provincially. So for parents who earn $50,000 for example they could end up paying an addition $224.28 in taxes. So if you combine these two claw backs then the parent in this circumstance is receiving about $158.22 for the year per child. This works out to about $13.18 a month. Doesn’t sound so impressive now does it?
In fairness however we must keep in mind that there were other potential tax benefits that the Conservative brought into play. The point we are trying to make however is focusing around the UCCB and realism of it.
It is far too easy to get caught up in the hype that often rears up whenever a government body is introducing something new in favor of the people. The actual realism of what is really taking place always seems to get buried in what they are promoting as the good elements. Then again that is what politics is all about and has always been about.
In regards to the delay of payout according to the government they want to make sure the budget was balanced. Then again one has to look a little closer here to. Was the recent release of this seven month payment a campaign launch strategy. The announcement for the upcoming election is right on the horizon and having the voters enter into the election mode with some money in their pockets thanks to the government is a great way to start a election launch, wouldn’t you think?
No doubt if this were the game plan to have the tax payers in a great mindset towards the conservatives they weren’t too happy with the announcement of the worse than expected growth outlook for the country. There is a lot of uncertainty as to whether we are in fact in a recession or on the brink of one. Not a great situation to be in for an election year.