During last year’s election, the Liberals said it would be revenue neutral.
But new numbers from the Parliamentary Budget Office show a tax hike on the rich and tax cut for the middle class will cost us.
The report looks at the fiscal impact of a new 33 per cent personal income tax rate on income over $200,000 and a reduced 20.5 per cent rate on those earning between $45,000 and $90,000 a year.
The Liberals said the tax hike would bring in $3-billion in new taxes each year, while the cut would reduce government coffers by the same amount.
But the Parliamentary Budget Office says the actual result of the changes is a loss of revenue, $400-million in the current fiscal year, and around $1.7-billion annually after that.
It says the middle class tax cut would impact 43 per cent of taxpayers, giving out more money than the changes bring in.
Last month the Liberals acknowledged their election-time projections were off, suggesting the tax changes would result in a $8.2-billion shortfall over six years.
The numbers released today suggest the deficit would actually be $8.9-billion.