Working Canadians say hands off our TFSA: As Liberals claim to support the middle class, they should leave TFSAs alone

Toronto, December 8, 2015 – Although it is refreshing to see the federal Liberal government admit they erred regarding the amount of revenue they previously claimed would be raised by hiking income taxes on the “rich”, they would be well-advised to also rethink their plan to reduce the limit of the Tax Free Savings Account (TFSA). Work done by Working Canadians over the past month, including a public opinion poll and petitions,  has shown that the TFSA is anything but a tool only for the “rich”, and that the majority of low- and middle-income Canadians also very much support the higher limit. A majority of Canadians who voted Liberal in the recent election also support the current TFSA limit. “This government claims to be concerned that average Canadians are not saving enough for their retirement, and then weakens one of the key means for Canadians to save in a tax-efficient way?” asked Catherine Swift, spokesperson for Working Canadians. “That certainly doesn’t sound like a consistent policy approach at all.”

Another ostensible reason government has claimed for reducing the TFSA is that it “costs” the federal treasury too much. Yet, the federal government spends much more to enable government employees to enjoy very generous indexed pensions and other benefits on the taxpayer dime. “It is difficult to justify spending tens of billions of tax dollars on rich pensions for the 20% of Canadians who work for government, then turn around and say they can’t afford a small fraction of that to run the TFSA program. Allowing the 80% of Canadians who work in the private sector to save for a decent retirement for themselves and their families is only fair,” Swift said. Adding, “Prior to the election, the Liberals said they would be basing their policies on factual evidence. If they do intend to base policy decisions on fact, scaling back the TFSA limit should be the last thing they do.”

Comments Working Canadians has received on its online petition are instructive. Here are some examples:

  • “Doesn’t it make financial sense to keep as many Canadians as possible providing for their own retirement funds so that the existing system can better provide for those that truly need the assistance?”
  • “With such a low income, TFSAs are a necessary part of my retirement. Please do not reduce the limit.”
  • “The TFSA is of great benefit to me as a one-income household senior. The amount should not be reduced.”
  • “It should be higher than $10,000, not reduced. After all we are using after-tax dollars to create TFSAs in the first place.”
  • “As a freelance contractor working in the real world, no one gives me a fat pension. Leave the TFSA limit at $10,000 and help hard-working Canadians help themselves.”

 

The Canadian government has recently created a new online petition process. The Working Canadians TFSA petition can be found at https://petitions.parl.gc.ca/en/Petition/Details?Petition=e-3

Swift concluded, “Often an incoming government wants to change or water down policies of the previous government. In the case of the $10,000 TFSA, this temptation should be resisted so that all Canadians, not just government workers, can be permitted a decent retirement.”

Catherine Swift is Spokesperson for Working Canadians, a not-for-profit organization dedicated to opposing the negative impact excessive union influence has on the Canadian economy and society.

To arrange an interview with Catherine Swift, contact Gisele Lumsden at 647 466-5509 or by email: [email protected]