Hmm! It Is Time Stephen........

.....send a cheque to everyone who pays PERSONAL income tax and cut back grants to social in-activist groups and cottage industries. When this is said and done the surplus will be about the same and we can save a little more by paying down the debt.

Surplus for past fiscal year estimated at $10.2B

Updated Fri. May. 23 2008 3:07 PM ET

The Canadian Press

OTTAWA -- The federal government surplus shrank to an estimated $10.2 billion for the past fiscal year after a $1.2-billion deficit in the month of March.

The preliminary tally released Friday for the 2007-08 fiscal year compares with a surplus of $12.9 billion in the previous year and more than triple the $3.3-billion surplus that was projected in March 2007 when the federal budget for the year was released..

The Finance Department said the government took in a total of $241.9 billion in the year ended March 31, which was $10.6 billion more than in 2006-07, while spending $230.3 billion, which was $12.5 billion more than in the previous year.

The $11.7-billion difference between those inflow and outflow numbers does not include $1.5 billion in spending commitments announced earlier this year, including measures to boost public transit and police recruitment. This spending, booked in end-of-year supplementary accounting, trims the year's estimated surplus to $10.2 billion.

The deficit in March, the final month of 2007-08, was half the $2.4-billion deficit in the corresponding month a year earlier. Ottawa typically runs a deficit in March because of a spike in spending as the fiscal year closes.

The month's tax take from individuals increased by $1.2 billion over a year earlier while business tax revenue declined by $200 million.

Although the preliminary figures were released Friday, the department said it likely won't have final figures on the 2007-08 accounts until August.

The year's revenue from personal income taxes rose by $2.1 billion to $111.5 billion, held down by tax cuts announced in last October's economic statement, some of which were retroactive to January 2007.

Flaherty said recently that rebates to Canadians filing income tax returns this year were up 14 per cent, largely as a result of the reduction in the lowest personal income tax rate to 14 per cent from 15.5 per cent, and the increase in the basic personal amount to $9,600.

Meanwhile, corporate tax revenues rose by $4.5 billion or 12.3 per cent to $40.9 billion.

The year's overall take also reflected the reduction in the goods and services tax.

On the other side of the ledger, while overall spending increased 6.8 per cent, the government realized $600 million in savings from lower debt servicing charges.

Much of the year's additional spending was on transfers to individuals, including the elderly and children, and to provinces as part of the changes arising from the fiscal balance package in the 2007 budget. Transfers to provinces and territories were up by $5.2 billion or 13.2 per cent.

One of the biggest increases in departmental spending came in defence, largely as a result of the war in Afghanistan. The Defence Department spent $17.7 billion last year, an 11.5 per cent increase over the previous year.