EI Tax Freeze Means Workers Will Keep Getting Plucked Till At Least 2017

By September 16, 2013Federal Politics

By Gregory Thomas, CTF. The three-year freeze on federal Employment Insurance tax rates announced Monday, September 9, by federal Finance Minister Jim Flaherty means Canadian workers will keep getting plucked, like a Thanksgiving turkey, for the costly program until at least 2017, according to the Canadian Taxpayers Federation (CTF).

“We don’t see this as good news,” said CTF Federal Director Gregory Thomas. “Mr. Flaherty should not be freezing EI tax rates, he should be cutting them.”

“Thanksgiving is coming, and it’s working Canadians who are getting plucked,” Thomas added.

The government took in nearly $3 billion more in EI taxes than it paid out in EI benefits in the 2012-13 fiscal year. The government’s own forecasts show multi-billion dollar EI surpluses until 2017.

For a Canadian two-income household earning the EI maximum – this year it’s $47,400, they and their employers will pay $4,277 in EI taxes in 2013, a 25 per cent jump since 2008, when their combined annual EI tax bill was $3,412.

Between 1994 and 2008, the federal government cut EI tax rates 14 years in a row.

“After hiking EI rates now three years in a row, it’s pretty convenient now that this is where they want to freeze them until 2017,” said Thomas.

“We see again today that EI is not an insurance program at all, it is simply a tax grab,” Thomas concluded.

Gregory Thomas is the Federal Director of the Canadian Taxpayers Federation.
He can be reached at:(800) 265-0442 (toll free) or (613) 234-6554 (office)

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