income taxes and low income canadians

The income tax reductions in Budget 2006 will remove over 650,000 low-income Canadians from the tax rolls altogether.
I do believe "low-income Canadians" need every cent they can get to get by, and that taking them off the rolls may reduce the administrative workload somewhat. But part of me isn't comfortable with the behaviour it is likely to motivate among those labeled as low-income canadians.
Raising the tax-free threshold increases the accessibility of the incentive for people to falsify their earnings to change their status, and I suspect there would be some (not likely a majority) that would perceive not paying taxes as an "acquired right." Their behaviour would shift toward that of a "dependent on society" rather than a "full member of society proudly contributing his/her fair share" with a stake in the success of Canada as a whole.
It also inches us closer to a tiered society, with haves, uber-haves, and have-nots, and that's not a vision of Canada that I care to encourage.