With International Women’s Day on Friday, a new report says that women are not getting fair treatment by Canada’s tax system.
Following calls from CPA Canada to make the tax system fairer for all, the Canadian Centre for Policy Alternatives has analyzed federal tax breaks and says that men appear to be capturing most benefits from tax deductions, credits, and loopholes.
Looking at the portion of benefits from 45 federal tax expenditures (tax deductions, credits, breaks and loopholes), the report finds that only 19% pay out more to women than to men.
“Addressing the gender pay gap and advancing gender equity have been stated priorities of the current government, but little attention has been paid to how the tax system may be reinforcing disadvantages,” says study author and CCPA Senior Economist David Macdonald. “Simply put, federal tax breaks are sexist, with men faring much better than women under the present system.”
Who’s getting the breaks?
The top five largest tax breaks that benefit men most are the employee stock option deduction, foreign tax credit for individuals, spouse or common law partner credit, registered retirement saving plans and pension income splitting.
The top five largest tax breaks benefiting women most are the eligible dependent credit, child care expense deduction, medical expense tax credit, pension income credit and age credit.
But in some cases, men captured more than 100% of the benefits from tax breaks, effectively creating a tax rise for women.
“Tax breaks that are not serving their purpose, exacerbate inequality or fail to promote gender equity should be closed and the substantial lost revenue should be put to better use.”
The full study “Are Tax Loopholes Sexist? The gender distribution of federal tax expenditures” is available for download on the CCPA website.
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