It's raining tax credits in Alberta, but who really benefits?

Lethbridge, Alta — The Globe and Mail

Alberta Premier Alison Redford announces the Conservative party plan for family health clinics at a news conference on main street in Strathmore, Alta., Monday, April 2, 2012. (Bill Graveland/ The Canadian Press/Bill Graveland/ The Canadian Press)

PC leader Alison Redford joined the tax credit parade Wednesday, pledging a rebate for seniors that would allow them to claim back up to $500 in leisure costs.

This comes after Wildrose pledged a $2,000 child tax credit and a $500 children’s culture, arts and sports tax credit. The Liberals, meanwhile, pledged a $500 tax credit for teachers.

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This is all on top of the federal tax credit for public transit passes introduced in 2006, a tax credit for volunteer firefighters introduced last fall (an announcement that took place, fittingly, in Alberta), the monthly universal child care benefit and others.

It all begs the question – who actually claims these tax credits?

Usually, it’s only the rich, or those who keep meticulous receipts and can afford to pay an accountant, says Scott Hennig, the Alberta Director of the Canadian Taxpayers Federation.

“That’s the worst way to cut taxes... it convolutes the tax code,” he said, noting the Canadian tax code was 11 pages a century ago, was about 2200 pages when Prime Minister Stephen Harper took over and is about 3000 pages long today.

“All these things are very nice things. I have nothing against firefighters, riding the bus or kids’ programs, but if they can cut taxes let’s just cut overall taxes.”

In the case of Ms. Redford’s announcement Wednesday, seniors would need to keep receipts and file a tax return. Whether they earn enough to actually pay taxes or not, they’d get full rebates up to $500 on approved programs.

“Wellness matters to everyone and it certainly matters to seniors in Alberta,” Ms. Redford said at her announcement Wednesday. “This is part of an ongoing commitment that a Progressive Conservative government, in the past and in the future, has had and will have on Alberta seniors.”

However, it won’t help all seniors, Mr. Hennig said.

“The only seniors that are going to be able to access this tax credit are the ones who can afford to go out to these seniors programs and then pay to have their taxes filed,” he said, urging Ms. Redford to instead raise the exemption level on income taxes or trim other taxes, such as those on insurance and gasoline.

Ms. Redford has repeatedly stressed on the campaign trail that her budget requires no new taxes, but hasn’t said anything about reducing them. While he says tax credits are nonetheless better than nothing, Mr. Hennig says such programs use the tax code for social engineering.

“Governments like to do social engineering, and I get that, but I’d rather they not do it with our tax code,” he said. “It shouldn’t be used as a carrot or stick to get people to do things they want you to do.”