Federal budget disappoints on tax relief for low-income Canadians

    OTTAWA, March 19 /CNW/ - Today's federal budget does little to provide
tax relief to low-income earners or remove the financial penalties for
entering the workforce, says the Canadian Restaurant and Foodservices
Association (CRFA).
    "The Working Income Tax Benefit (WITB) announced in today's budget is
small when compared to the steep financial hurdles that many Canadians face in
terms of entering and remaining in the job market. It will do little to
encourage labour force participation or reduce the high cost of working for
low-income Canadians," says Ron Reaman, Vice President, Federal, with the
34,000-member CRFA.
    Department of Finance analysis shows that a single parent with one child
who enters the workforce currently loses almost $8,000 of their first $10,000
in earnings as a result to taxes and reduced income support from government
programs. The WITB contained in the budget reduces this clawback by only
    "The welfare wall remains a significant barrier to entering the
workforce," says Reaman.
    In a pre-budget submission, CRFA had urged the federal government to ease
the tax burden on working Canadians by raising the basic personal exemption,
and reducing the tax rate of the lowest income tax bracket. These measures
would increase disposable income for Canadians and allow those with limited
incomes to retain more of their earnings.
    Both the Organization for Economic Co-operation and Development and the
International Monetary Fund have called on Canada to improve work incentives
for low-income Canadians.

                   Global Commerce Strategy Misses the Mark

    CRFA is also concerned that the federal government appears to be
abandoning its commitment to multilateral trade negotiations in favour of
bilateral agreements.
    "Measures announced in today's budget won't address trade-distorting
practices with respect to agriculture and therefore limits the potential
benefits to Canadian consumers," says Reaman.

    CRFA is one of Canada's largest business associations with 34,000 members
representing restaurants, bars, caterers, hotels, and foodservice suppliers.
Canada's $51 billion foodservice industry employs more than one million people
and represents 3.8% of the country's GDP and 6.6% of the workforce.

For further information:

For further information: Ron Reaman, CRFA Vice President, Federal, (416)
937-8640 (cell); or Jill Holroyd, CRFA Communications, (416) 649-4217

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