Ugh….Facepalm!

Well, ya did it again, didn’t you provincial NDP government?

You put out a news release trumpeting your new children’s arts and culture tax credit:

http://news.gov.mb.ca/news/index.html?archive=2011-05-01&item=11399

http://www.winnipegfreepress.com/breakingnews/Tax-credit–expected-to-save-Manitoba-families-3-million-a-year–121337294.html

Do you bother to do background checks on items before you issue news releases or develop policies?

Either the numbers in your news release are incorrect because you are counting tax credits already claimed under other programs, or you developed a tax credit without taking two seconds to look at the federal children’s fitness tax credit.

Either way it’s embarrassing.

What am I talking about?

Here is a section straight out of the news release:

Families will be able to apply the credit to organized and supervised arts and cultural activities taking place in Manitoba and outside a school’s regular program.  Examples include activities involving:

  • the arts (dance, drama and photography);
  • culture (music and languages);
  • wilderness and the natural environment (gardening, 4-H and scouts);
  • the development of interpersonal skills (girl guides, public speaking and cadets); and
  • receiving tutoring in school subjects.

What’s the issue? There are several of the above that already qualify for the children’s fitness tax credit, and at 15% for that, why would I claim them at 10.8% on my provincial tax return? Unless we can claim under both, but I seriously doubt that is the intention.

How can the above qualify for children’s fitness tax credit?

Here is the relevant information from the CRA website (http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns360-390/365/rgnztns-eng.html):

an eligible fitness expense must be for the cost of registration or membership of an eligible child in a prescribed program of physical activity. Generally, such a program must:

  • be ongoing (either a minimum of eight consecutive weeks long or, for children’s camps, five consecutive days long);
  • be supervised;
  • be suitable for children; and
  • include a significant amount of physical activity that contributes to cardiorespiratory endurance, plus muscular strength, muscular endurance, flexibility, and/or balance.

In addition to obviously strenuous games like hockey and soccer, activities such as golf lessons, horse-back riding, sailing and bowling (as well as others that require a similar level of physical activity) are considered to be eligible for the credit. If the child is eligible for the disability tax credit, activities that result in movement and in an observable expenditure of energy in a recreational context.

If activities such as horse-back riding, sailing and bowling meet the criteria, then clearly dance meets the criteria ( so if you are a parent who hasn’t been claiming this, you should be).

And guess what – Scouts Canada has been issuing fitness tax credit receipts as well:

http://www.scouts.ca/dnn/LinkClick.aspx?fileticket=X5rRzlKNVs8%3D&tabid=36

So, provincial gov’t, did you:

a)      Not do your homework in developing the arts tax credit?

b)      Inflate the numbers in the news release to make it look like it will have more effect than it will? The numbers in the news release are all off. It states that families representing 186,000 children could save up to $3M per year ( even though the title says they WILL save $3M per year). Problem with that number is that $54 tax credit for 186,000 children is $10.04 Million, not $3M. $3M would only be 55,555 children. So which is it?

-or-

c)      Are going to allow families to claim the same activity under both the provincial arts credit and federal fitness credit.

As much as I am hoping for ‘c)’, It’s more likely ‘a’ or ‘b’

I’m all for a Children’s Arts tax credit, but at least a) do you homework on similar tax credits and b) get the numbers in your new releases correct.

Good Job.

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2 thoughts on “Ugh….Facepalm!

  1. It’s my understanding the provincial Arts & Culture credit will mirror the upcoming federal Arts & Culture credit. This is how the provincial Fitness credit came into being as well. Both credits will be claimable against your provincial (10.8%) and federal (15%) taxes.

    I’m sure they’ll amend the criteria to prohibit people from claiming against both programs.

    As for the inflated numbers, my guess is that they’re being a bit cute here. There are a large number of families who wouldn’t be able to claim the credit because their household income isn’t high enough. They’re being counted as part of the 186,000, even thought they won’t see a dime.

    This is a big part of the reason why these credits are such crappy policy. They don’t help the people who actually need it: families that can’t afford arts, culture or fitness programs in the first place.

  2. It should mirror the Federal A & C tax credit, but why does the government trumpet activities that currently can be covered by the fitness tax credit?

    You’re right though – the families that would benefit the most won’t see a dime. That’s the problem with these tax credits (and things like the tuition freeze) – while I like the idea of more money in my pocket – these credits aren’t going to make a difference as to if I put my kids in A & C activities.

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