Income Splitting ‘Terrible Idea”

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    Two out of three families targeted by a Conservative income splitting plan would receive less than $500 while fewer than four per cent of such families – some of the wealthiest in Canada – would be eligible for a benefit in excess of $5,000, says a study by the Broadbent Institute. “This study spells out clearly why the Conservatives’ income splitting scheme is a terrible idea,” says Rick Smith, executive director. “It would increase inequality and is skewed heavily toward a ‘Mad Men’-style family with a high-income earner and a stay-at-home spouse.” In addition to the scheme’s unequal distribution of benefits across families with partners in different income brackets, the benefits would also vary significantly by province. Nine out of 10 Canadian households would receive no benefit at all.