Will the expected tax changes be retroactive?

by in Canadian Government News and Updates
Will the expected tax changes be retroactive?
There have been many announced plans by Justin Trudeau’s government regarding the Canadian tax system.  For one, the new government plans to lower the income tax rate for the middle-income earners, particularly those with income above $45,000.  Another change announced is the introduction of a new tax bracket of 33% for individuals earning more than $200,000 annually, up from 29%. 

The big question, whether you will be affected by the tax cut or tax hike, is “are these changes retroactive?”

According to a recent Financial Post article by Jamie Golombek, “Will Justin Trudeau’s tax changes be retroactive? Don’t rule it out,” tax laws, in most cases, are not retroactive and are generally valid on the date of the announcement.  However, there were particular instances wherein the government successfully passed retroactive legislation, “the legality of which has be unsuccessfully challenged in court on various occasions.” 

The Parliament will be resuming on December 3rd and one of the first issues they will be tackling is the change to the tax bracket.  We might have to wait till then to know what the answer to our big question will be. 

Source:  “Will Justin Trudeau’s tax changes be retroactive? Don’t rule it out.” By Jamie Golombek, November 13, 2015, http://business.financialpost.com/personal-finance/will-justin-trudeaus-tax-changes-be-retroactive-dont-rule-it-out

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