Monday, 2 April 2012

No More Pennies!

Last week the federal government delivered the budget for 2012. Here are some key points:
- The budget is expected to be balanced by 2015/2016.
- CBC will get $115 million less by 2014/2015.
- Starting June 1st 2012, Canadians traveling to the  U.S. for over 24 hours will be allowed to bring back $200 worth of goods (the limit was previously $50). If Canadians are taking a trip over 48 hours, the limit is raised to $800 (from $400).
- Old Age Security eligibility age will increase from 65 to 67 by 2023.
- The mint will have its last print run of pennies this fall.

There was of course a lot more on the budget but I think these were the most interesting. The feds expect to be back in the black by 2015/2016. Hopefully they keep their promise of raising TFSA contribution room when that happens. Isn't it great how I'm only concerned about issues if they involve me somehow?

CBC will be getting less funding:
Again, personally, this doesn't matter much as I barely watch television as it is and when I actually do, it's usually American programing. However, I do feel that it is important that Canadians have a medium distinct from our neighbours to the south. It helps create an identity as a nation... and I know I'm being extremely hypocritical because I don't watch CBC, but I use to! Back in undergrad I watched the Rick Mercer Report religiously, in fact, that was the main source of political information... which is kind of sad when I think about it. I also like Dragon's Den but I won't make an effort to tune in; I will however, watch it if I happen to come across it. As long as Hockey Night in Canada doesn't take a hit, I think I'll be okay with the cut... it's sort of become a bit of tradition that I have with my girlfriend to watch my beloved Maple Leafs throw away their season every Saturday night...

Increasing the exemption limit:
I have a confession to make. I have been outside of Ontario only three times in my 22 years of life:
i) Montreal
ii) Montreal
iii) Buffalo
(and I've been told repeatedly that these trips do not count)
As you can see, this is probably not going to effect me anytime soon. However, I still find this to be a nice little rule change. I recently got my passport and I heard that shopping across the border is worthwhile so I may take a little trip eventually.

OAS age eligibility increase:
This may seem like bad news at first glance and it may very well be for the people who will be retiring in 2023. The fact of the matter is that technology has improved our lives immensely and our life expectancy has been steadily increasing. It seems appropriate that the OAS age eligibility increases accordingly. Sure that may mean that I would have to work a lot longer in the future but I don't mind that much if I'm living longer as well. Also, as the majority of the population ages, the resources that are used to support the elderly will not be as strained and the burden put on the younger cohort (via taxation) will not be as heavy. It should be noted that the transition would be gradual so hopefully we can become adjusted to the change as we get eased into it.

The end of the penny:
It may seem strange to you, but the biggest news I took away from the federal budget was that the penny was going to be phased out. Sure, it makes sense because inflation has made the 1 cent coin obsolete. It also costs 1.6 cents to mint a penny and everybody just complains about them anyways. Even with all the good reasons (which I agree with) to eliminate the penny, I can't imagine life without them. Yes, I don't have a particular use for them and they are a nuisance but I grew up with it is going to be weird not seeing those useless copper coins when I get my change from a cashier. Having no 1 cent denomination is going to need some getting use to. As for the price of items, they will be rounded to the nearest nickle if you're paying in cash, otherwise, the price will remain the same. Pennies will still be accepted even when they stop being minted so don't go and throw them away!

-the Paperboy

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