This is another fairly fair and usably useful article, this time on the practical questions facing the Harper government on the issue of income tax in their upcoming budget, including the further unexpected windfall from oil and gas prices being so high and climbing. As we have learned, PM Harper has already come to terms with election promises being all well and good for what they are worth so it will be interesting to see how different the actual plan is from the claims made on the road by the semi-populist mid-minor economist.
And yet...it is interesting to note who are the crabby finger-pointers being quoted:
The Canadian Taxpayers Federation has calculated that the vast majority of individuals or families with children six years or older will pay more in taxes if the GST is dropped by one point and the income tax reductions, announced in the 2005 mini-budget, are withdrawn. "Virtually every Canadian taxpayer with an income between $10,000 and $85,000 without young children will pay more tax in 2006 if the Harper government rescinds the 2005 income tax measures," CTF executive director John Williamson said. "In fact, even two-earner families with a combined income of $100,000 can expect to pay more tax overall. This is true even with a one-point reduction to the GST and the introduction of the various targeted tax credits."Unfortunately, no one including the CTF seems to have actually simply shown the math anywhere that I can see. You would think that simply running the numbers on various credits and rate reductions would be a matter of a plain graphical representation of information. A prize to anyone who can find one. But don't expect me to do one up or even search too hard. I'm just a complainer.
Comments
Flea - April 22, 2006 5:56 pm
This emphasis on "hard news" is leaving us starved for banjo-media.
cm - April 22, 2006 7:19 pm
It finally dawned on me what a wonderful addition the banjo will be to the GenX40 Glee Club. Whoot!
Alan - April 22, 2006 8:26 pm
I know and am addressing your unhappiness in 3/4 time over the weekend, singing your song with my dancing digits.
Alan - April 24, 2006 8:13 am
Apparently some people do not know they are dealing with an economist:<blockquote class="smalltext">Finance Minister Jim Flaherty, whose upcoming budget will lower the GST, has been told by his department that Canada is already out of step with many peers because it relies relatively little on consumption taxes, and heavily on income taxes, to raise money.<p>"Canada raises more of its revenue as a share of [gross domestic product] from personal and corporate income taxes than any other G7 country," Finance Department officials say in briefing books prepared for Mr. Flaherty and obtained under access to information law. "Correspondingly, Canada raises relatively less tax revenue from consumption taxes, the tax that least damages productivity and standard of living."<p>Officials tell Mr. Flaherty that while Canada's "personal and corporate income tax burdens are the highest among the G7 countries," the broader trend favours consumption taxes. "In recent years, the tax burden has been moving toward consumption taxes (away from income taxes) in a number of OECD countries," officials say, referring to the Organization for Economic Co-operation and Development. In fact, Finance officials say, Canada's 7 per cent GST is relatively small compared with many other countries with value-added taxes — which are similar to sales taxes in that both are levied when goods and services are sold.</blockquote>
David Janes - April 24, 2006 10:09 am
Those officials should run for government and try to get elected on a platform of something else besides lowering the GST!
Alan - April 24, 2006 10:19 am
Because the nation needs 31,000,000 elected representatives as only then will they have the understanding of the truth we need as a nation!!!
David Janes - April 24, 2006 12:03 pm
No, only very special qualified people should be allowed to run, where the will benevolently rule us with the very best understanding of the international consensus about the right way to do things.
Alan - April 24, 2006 12:09 pm
...and staff should never be considered qualified.<p>My actual concern is how the policy disagreement gets to public discussion not that there is disagreement on the science of economics.
David Janes - April 24, 2006 1:06 pm
<blockquote>
My actual concern is how the policy disagreement gets to public discussion not that there is disagreement on the science of economics.
</blockquote>
Explain more and I'll have non-trivial comments after my workout. We've certainly had public discussion of GST vs. Income Tax policy and there certainly is disagreement in the science of economics -- especially given their examples feature aging, moribund Deutschland and Nippon -- about what is best to do, though perhaps not amongst the econonmists in that Department.
But this is the great thing about living in a democracy, at time. 9 out of 10 doctors/econmists/experts agree doesn't mean we have to do things this way.
Alan - April 24, 2006 1:26 pm
Oh, I don't me you and me speaking publicly. I mean the senior civil servants. How is it that they are able to speak with the paper about how their thoughts differ from the politicians - even in the wonky science of economics. How is it that the Globe got what it describes as briefing books placed before the Minister of Finance?
David Janes - April 24, 2006 3:28 pm
They did a Freedom of Information act request!
The issue behind many of these things is not "what's the answer?" but "what's the question?". A series of computer simulations may suggest that all other things being equal, "prefer to tax the second and third quintile economic productivity units" may be the best way to increase the GDP; it's just when that gets translated into "bleed the middle class because they have the money and no options", it gets a little trickier.
David Janes - April 24, 2006 3:30 pm
For the record, I don't believe in the GST or Income Tax. Rather I would prefer to see a series of reasonable "fee for services" and a "non-savings tax"; that is, you are taxed a percentage of (income - savings).