The Harper Government and Taxation
(summarized from The Harper Record, CCPA, 2008)
- Wages and market income are very unequally distributed in Canada, but our tax and transfer system redistributes income from the more to the less affluent.
- Taxes also finance public services — such as health care and education — that benefit all Canadians regardless of income.
- Lower corporate taxes are supposedly needed to make Canada internationally competitive. However, when the Conservatives took power in 2006, combined federal/provincial corporate tax rates were already well below the U.S. average, among the lower half of G-7 countries, and only two percentage points above the world average.
- Nevertheless, the Conservatives decided to cut federal corporate tax rates by seven percentage points. These huge corporate tax cuts have not stimulated additional investment.
- Together, the Harper government’s GST cut and its corporate tax cuts represent a minimum of $20 billion that will have to be cut from other parts of the federal budget. Cuts need to be to whole departments and programs, likely to large budgets such as health care and education. Canadians are not being told what services are going to but cut, but the cuts will have to be massive in order to balance the budget.