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The Liberals plan to tax the rich to help children and the middle class

The Trudeau tax policy plan announced Monday comes in two parts. One revamps support for families for children and the other taxes the rich, a favourite way today for governments to provide modest tax relief for the “middle class.” Trudeau’s plan doesn’t call for the cancellation of increases for investments in Tax Free Savings Accounts.

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These tax packages are mainly about redistribution, not growth. Although marginal tax rates will fall for those with modest incomes, they will rise for many middle-income child-bearing families with more than $45,000 in income.

The Trudeau Child Benefit Plan wraps up the Chretien child benefit package with the Harper family tax cut into a new non-taxable benefit that is more generous to families with income below $150,000. A family with one child will receive $6,400 with higher amounts paid for larger families. The benefits will be clawed back for incomes above $30,000, varying from 3.1 to 16 per cent, the highest rate for larger families with incomes below $65,000.