Winnipeg Free Press

Winnipeg Free Press (Newspaper) - November 13, 1981, Winnipeg, Manitoba 12 Winnipeg free november budget 81 by Paul Pihi Chyn Winnipeg free press Ottawa last nights Federal budget provides Relief Only to those homeowners who find themselves in the direst of dire finance minister Allan Maceachen set aside million to fund a series of measures aimed at helping Home owners hardest hit by High interest but at the same time made it flaws spotted Federal budget Aid to hard pressed homeowners will mean More jobs for Ottawa but wont do much for Manitoban forced to the Wall by High mortgage interest says Norm its no help at All to people pressed to the said the mortgage action committee he said the pro Grams guidelines will probably pose an administrative other Manitoban contacted said a recent dip in the Bank rate would More help to most homeowners than the mortgage assistance scheme revealed in finance minister Allan Mac each ens budget last disappointed and most of the politicians and businessmen interviewed expressed disappointment with at least some aspects of the provincial nip Leader Howard Pawley said he was disappointed with and sorry about the contents of the drawing the provincial election into his Pawley said the Federal budget was following in the footsteps of four years of conservative government in the budget does not Deal with the question of he and like the the Federal government is not adopting a positive role toward the Federal government schemes to As Sist Small businesses and homeowners facing High interest rates Are said Premier Sterling while campaigning in said the Federal program to assist banners and stimulation of apartment construction dont first Blush appear to be finance minister Brian Ransom re fused to comment on the budget last saying he and his staff were in process of examining it in Lyon and Ransom scheduled a press conference for today to comment in detail on the Federal financial pack provincial Liberal Leader Doug Lauchlan also said he would comment in detail today about the but expressed concern about the Bud gets implications for Lauchlan said he is disappointed that economic development expenditures in Western Canada will be Only Mil Down from billion announced in the last As Lauchlan said he is disappointed in Federal promises of Energy Price increases which will have an inequitable Impact across the coun with consumer provinces becom ing the it is vital that the provincial government that is elected tuesday Call the Manitoba legislature into immedi ate session to Hammer out its position on established programs financing which will be renegotiated under the new he Federal payments to mostly used for pos secondary Educa Tion and Are to be Cut by billion during the next five the government says part of the loss will be made up through increased income tax receipts for provinces under taxation agreements with Ottawa Worth progressive party Leader Sidney Gre ii said the government this budget in because they were forced the province will feel the squeeze and some provincial parties will be Quick to loudly criticize the Federal he Green described the Federal Mort Gage assistance program As quite Jack president of the Winnipeg chamber of com said our first reaction to the budget has been very business people could have Swal Lowed paying More tax had the government made evident its commit ment to control Federal he they talk restraint and theres Al most no sign of government he pointing to the projected in crease in Federal spending from billion to billion during the next fiscal some of the measures outlined by the government will restrict investment and rather than the econ he a bitter Sharon spokesman for a Winnipeg group called Home owners against rising said the budget has done absolutely nothing to fight i think it is a i billion array car period to 19bm7 s new Brunswick billion Nova Scotia billion Prince Edward Island billion Newfoundland billion British Columbia 92 billion Alberta billion Saskatchewan billion Manitoba billion current Efren Enwrig 1 pro Pond Arronge Antt Tablet 5 and Tat cat Ontario Standard for needy Ottawa Ontario can afford so can the rest of the coun at is the philosophy governing a proposed new Way of calculating equalization payments to the country six poorest prov under the proposed scheme unveiled in yesterdays prov inces with a Small or impoverished tax base lacking the per capita capacity to raise the same reve Nues As does would receive the difference through equalization equalization payments would then enable All to provide services comparable to those which Public authorities in Ontario would be Able to finance with average rates of boasts a news release accompanying the Prince Edward is Nova Quebec and Manitoba will receive almost billion during the next five years under the it was decided to change the for Mula used to calculate equalization payments when the traditional fat of suddenly found itself among the have not provinces and was technically eligible handouts despite its relatively Selloff Ontario landed on skid Road be cause the existing formula uses revenues from Oil and Gas to help distinguish Rich from the importance of these revenues in the formulas put Ontario below the for Mulas poverty will the six poor provinces receive More or less Money under the proposed formula finance depart ment officials were asked that ques Tion last some said they did not know the answer and some said the provinces would receive but didst know now much by using a have not As the new average the Federal government in lowering the National Stan Dard in the but by increasing the importance of natural resource revenues and the pendulum swings the other raising the National provincial government economists undoubtedly will spend hours at their calculators trying to deter mine if the pendulum has really swung their bringing More help from or will result in a net loss of Clear he was counting on the Banks and financial under Maceachen Home owners who face a combined interest and municipal tax payment which exceeds 30 per cent of the Gross household income eligible for fed eral government homeowners with what Maceachen called a reasonable amount of equity in their Homes can obtain Relief by arranging with their mortgage Holder to defer part of the higher the government will guarantee the interest to limit of when those mortgage payments Are More than 30 per cent of Gross in in the Case of households with Little or no equity in the and where interest deferral alone will not provide sufficient the government will write off up to 100 per cent of the interest deferred under its guarantee rental housing boosted the measures apply to All mortgages renewed Between and Maceachen said further details of the plan will be released by housing minister Paul Cosgrove when he introduces enabling amendments to the National housing in order to encourage the construction of rental the government will provide interest free Loans of up to for each to provide new rental units allocated to tight markets across the it was known How Many of these interest free units would be allocated to the units will be in addition to the units already scheduled to be built across the country in 1982 by the Canada mortgage and housing Cor Federal officials will be meeting with provincial housing authorities to deter mine exact allocation of the new Maceachen in his Maceachen said he wants financial especially to do i particularly want them to ensure that ample funds will be available to smaller borrowers at the lowest Possi ble margin of Cost Over the rates which they pay to their in a detailed paper on the budget which Maceachen tabled in Parlia he said canadians renewals before the Middle of while renewal at substantially higher interest rates will almost in variably require some adjustment to household the increase in mortgage payments on renewal will in the vast majority of result in situations where actual ownership of properties is of those facing mortgage re Maceachen estimates 65 per cent will be renewing five year Mort income growth Over those five years for the vast majority of these More than make up for the increases in mortgage payments upon Maceachen said that in few of these cases will the renewal result in pay ments of More than 30 per cent of the household he said Home owners will also find themselves in a better Cash flow position As a result of the general tax reductions offered to most canadians in the the budget paper concedes that very High interest rates have placed severe burdens on All but argues that savers were Able to obtain a return on their Money which More than compensated for the erosion of its real value by it says the government recognizes that the interest rate level is having a serious effect on some parts of the agricultural especially hard hit have been Farmers with Large who Are now having difficulty i meet ing their debt charges because of the combined effect of depressed Market prices for their products and rising input special loan rate to assist the budget offers a special loan rate of per five percentage Points below the Normal farm credit corporation rate of 1634 per a total of million has been set aside to enable the farm credit corporation to make these special the Loans would be written at the 1634percent but a five percentage Point rebate will be paid Back to the Farmer for up to two there would be a loan maximum to any individual any Farmer demonstrating financial distress would be eligible for the in a bid to help Small Maceachen is offering preferred tax treatment to firms in financial difficult the preferred treatment will apply to portions of interest fates at More than per cent and is available to both incorporated and unincorporated by Michael Doyle Winnipeg free press Ottawa finance minister Allan Maceachen last night came Down hard on Canadian executives and others who Are accustomed to using loopholes to decrease their tax Maceachen says his new budget will reduce Overall taxes to a degree the average person will not feel the but removal of tax preferences hits areas Ordinary wage earners have used As legitimate Maceachen estimates 12 million tax payers will pay Les Money year under his budget an average he provides figures to show Only will pay More a senior Federal official said the aim of Maceachen massive overhaul of the tax system was to make fairer a system which saw the wealthiest canadians getting undue tax Breaks and misusing incentives to a degree the original value of the incentives was often lost to the the wealthy were the the official said among the key changes Are a series of new taxes on Nona Cheque benefits provided by detailed budget documents say its mostly the higher executives who get company often used As a under the carpet form of pay which should be the changes d from now employers who get interest subsidies on Loans provided by a firm will have to incite the subsidies As income and face taxation if the subsidy is to buy company they would also be taxed if the loan is More than and used to buy a d the Benefit of company cars will be counted As income to the tune of 80 per the Cost of the Jease or per cent of the cars Purchase Price for each month the car is made available for personal d contributions for supplementary health and dental insurance by a com Pany Are counted As a Benefit for the employee and will be taxed As income from transportation such As provide their and lodging assistance will be taxed appropriate certain dismissal and termination pay which had been tax free now becomes d the rules on putting retiring allow ances into rasps have been tightened to a maximum per year for each year an employee worked for his com senior executives had been pay ing themselves hundreds of of dollars on retirement and shooting it rasps to avoid taxes the budget d business firms will no longer be permitted to deduct their contributions to a deferred profit sharing plan which provides benefits to principal share holders of the firm and that Type of plan will no longer be accepted in the the idea was for profit sharing among but the plans had been set up so they benefited Only top d personal service corporations set up by senior executives to convert employment income into business income eligible for Small business tax incentives will now be subject to the full tax d deductions for support payments to nonresident dependents will be limited to payments made to a taxpayers spouse and d the deduction on income averaging annuity contracts and Reserve provi capital gains will be discontinued while a new Forward averaging mechanism will be set up to ease the Burden on those whose incomes flu Cut these and a Host of other changes bring in Only billion compared to projected government revenues of ;