2006 Canadian Federal Budget

2006 Canadian Federal Budget was announced by Jim Flaherty, the Finance Minister of Canada on 2nd May 2006 in front of the members in the House of Commons. It was the budget report of the financial year 2006-2007. The most notable topics of the budget were the tax reductions on the goods and services, rebate on the income tax of the middle income group and last but not the least $1200 for every child under the ‘Universal Child Care Benefit’ program provided for the children to their parents.

The Canadian Federal Budget of 2006 was released by the minority government under Prime Minister Stephen Harper. He wished people to know about the budget and make sure of what to expect from his government. His was a conservative government. Apart from Bloc Quebecois no other party supported the budget of 2006 prepared by the Finance Minister. Opposition parties like the Liberal Party and the New Democratic Party did not lend their support in favor of the proposal.

According to the norm the budget was introduced in the House of Commons by the finance Ministry for the third time and was passed after a goof up in the session. In fact the budget was passed earlier than had been thought by the ministers.

Highlights of the Budget 2006

A number of issues were picked up at this budget and they were discussed in the House of Commons. The highlights were:

• The tax on goods and services was reduced by 6% – 7% from the month of July. People who bought new residential houses were provided a transitional adjustment rates. The income tax rate for the middle income group was made 15.5% till the month of June. It was estimated that the amount exempted from tax by 2009 will reach $10000. These were some of the benefits provided to the individuals and families.
• There were certain benefits offered to the students . Canadian students were allowed a tax credit of $500 on their text books. The scholarship and fellowship programs will be exempted from tax. More loans were made available to the students of Canada. The government sanctioned an amount of $1 billion for the provincial educational institutions. Even the students involved in internships would receive new grant of $1000.
• The senior citizens received several benefits. The retired persons drawing pension are no more required to pay taxes on their pension amount. The amount allotted to the medical expenses was also raised and finally plans were implemented to safeguard the pension benefit holders.

In this way many other changes were made to the existing Canadian financial structure in the budget session of 2006 in Canada.