FRANCAIS

June 05, 2006

Finance Minister Greg Selinger today announced that legislation has been introduced which proposes Manitoba Tax Credits not be reduced as a result of the recently announced federal Universal Child Care Benefit, saving eligible provincial recipients $1 million.

The proposal is included in the Budget Implementation and Tax Statutes Amendment Act which was introduced today in the legislature by Finance Minister Greg Selinger.

"Manitoba has already announced that families with children under age six in Manitoba who are receiving employment and income assistance will receive the full federal Universal Child Care Benefit and their income assistance levels will not be clawed back," said Selinger. "The change announced today is a positive step for working families and assures them that their credits will not be reduced."

Manitoba has three income-tested benefits delivered through the income tax system: the Personal Tax Credit, the Education Property Tax Credit and the School Tax Credit for Homeowners. Each of these credits is calculated as a base amount which is reduced by one per cent of net income. Without the proposed change, the money received under the federal benefit would have automatically reduced the amount of these credits for eligible recipients.

For both federal and provincial purposes, the federal benefit will be treated as taxable income in the hands of the lower-income spouse or common-law partner.

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