Canada's First Blue Budget in 13 Years

The goods and services tax (GST) will drop to six per cent from seven per cent on July 1. For people buying a new home before that, a "transitional adjustment" equivalent to the difference in rates will be offered through the income tax system.

Changes for students

• Canadians attending university or college can claim an annual $500 tax credit on textbook costs, which translates into a benefit of about $80 a year for a typical full-time student.
• All scholarship, fellowship and bursary money will now be income-tax exempt, compared to the current exemption limit of $3,000 a year.
• More people will be eligible for Canada Student Loans because of a reduction in the amount parents are expected to contribute toward the cost of post-secondary education, effective August 2007.
• The federal government will give up to $1 billion to provinces and territories needing to make "urgent investments in post-secondary education infrastructure."
• Apprentices in the skilled trades will get a new $1,000 annual grant in their first and second years, plus a tax deduction of up to $500 for the cost of tools they need for the job, above an initial cost of $1,000.

MORE DETAILS @: CBC News Indepth: Federal Budget 2006

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