Does Olivia think we are stupid...

Child care cheque backlash brewing




The Conservative government could face a backlash from parents as the taxman demands his cut of the new $100-a-month child care cheques.

Early next month, families who have been receiving the Universal Child Care Benefit will receive a statement of payments from the Canada Revenue Agency to be filed with their 2006 returns. The feds insist they've been up-front on the fact it's a taxable benefit, but critics say it was downplayed by Tories desperate to sell a flawed program.

Liberal MP Bonnie Brown predicts many Canadians will be taken surprise by the tax bill, and said it will hit working poor and single parents the hardest.

"I don't think anyone is thrilled about paying taxes they weren't expecting, so I think they will be quite angry," she said. "And some won't have it. It will end up adding stress to the lives of those who are struggling already. I think some of them are going to be stressed and sad, and that might turn to anger because they might feel they were fooled."

Brown said a parent with three young children could owe close to $400 for half the year's benefits in 2006.




Murray Gross, a spokesman for Human Resources and Social Development Canada, insisted the department has tried to get the message out from the start. A government website explains how the program works, and a notice with the first payment included a reminder that it's taxable.

DELIBERATELY LOW KEY


"LOW KEY,, how is it low key we all know they are taxed. Don't get me wrong I'd rather them not, but to be fair...

WE WERE TOLD!"

"From the outset, the government has been clear that the UCCB would be treated as taxable income, and that it would be taxed in the hands of the lower-income spouse, ensuring that families get the greatest possible benefit," he said.

But NDP MP Olivia Chow also believes it was deliberately low key and thinks some people will be "really mad" to learn how much they owe back for the benefit.

"It's a sham. It's deceiving Canadian taxpayers and working families," she said. "People will feel they've been cheated."

Chow said the benefit should become a non-taxable benefit, and the millions collected this round should be directed to creating new daycare spaces. She also slammed the administrative costs to run the program, which are running at $31 million for the first year according to department figures.