Stop cutting taxes and start solving problems

Our politicians are obsessed with tax cuts. The next election will now feature the battle of the tax cuts, with the Canada’s New Harperment pushing for more GST cuts (and who knows what other plans to reduce the size of the federal government) versus Dion’s plan for more personal and corporate income tax cuts.

Meanwhile, poverty and homelessness will continue to worsen, public services will continue to erode, and greenhouse gas emissions will continue to rise. How exactly is it that our taxes are not “competitive”? And how is it that cutting taxes will improve our standard of living? Dollar for dollar, the best investments we could make right now would be in early learning programs and mitigation of climate change, not tax cuts.

Message to politicians: stop cutting taxes and start solving problems.

Dion says he’d cut income taxes

Canadian Press
OTTAWA – Stephane Dion says a Liberal government would cut income and business taxes, not the GST.

In a speech today to the Canadian Club of Ottawa, the newly minted Liberal leader outlined a three-pronged economic agenda for Canada: competitive taxes, aggressive international trade and massive investment in innovation and education.

Dion accused Prime Minister Stephen Harper of squandering Canada’s long term economic competitiveness with dubious policies aimed at boosting the Conservatives’ short-term electoral prospects – such as reducing the GST.

The Harper government has already reduced the goods-and-services tax to six per cent from seven and may shave off another point in the budget later this month, as promised in the last election.

But Dion said an income-tax cut would be better for the economy and more appreciated by taxpayers who would rather take home bigger paycheques than save a penny on a cup of coffee.

Professor Dion, please present some evidence that income tax cuts will be better for the economy. If anything, income tax cuts will be more beneficial to those with higher incomes than an equivalent-sized cut in the GST. But neither tax cut will solve the problem of homelessness, environmental degradation, or even the hard-nosed challenges of improving productivity performance and stimulating innovation. I’m afraid that these real concerns of Canadians will get lost in the rhetorical battle over whose tax cut is better.

4 comments

  • http://www.chrishayes.org/blog/2007/mar/08/tax-not-four-letter-word/

    “Tax” Is Not a Four-Letter Word
    Down in the Texas state capitol for the day, enjoying both the buzz of activity that comes with the legislature actually being in session (they only have regular sessions for five month, once every two years) and the good ole boy lobbyists stalking the halls, making deals. Just had an interesting interview with a Republican State Senator in which he raised an interesting point. Basically, he was complaining about how the conservative movement had essentially been reduced to one single, inviolable principle: never raise taxes ever. It’s crazy he said. “I’m as much against having my taxes raised as anybody, but the the voters don’t send us to the capitol just to make sure taxes don’t get raised, they send us here to spend their money wisely. And if there’s some program that can benefit the residents of the state, then we should fund it.”

  • The Economic Agenda laid out by Mr.Dion today is three pronged.
    It includes competitive taxes, aggressive international trade
    and massive investments in innovation and education.

    It is not fair to suggest that Dion’s economic plan is focused
    on cutting taxes. You yourself make a couple suggestions that
    should receive greatest priority for the government: early
    learning programs and mitigation of climate change. You should
    know that Dion is committed to National Child-Care Programs, and
    is also a principled champion of the environment.

    My fear, and yours as well evidently, is that people will focus
    too much on the tax cuts. You’ve just engaged in this kind of
    narrowing of the debate, precisely by misrepresenting Dion’s
    Economic Plan. Hopefully, in the future, you will try to
    address Dion’s whole plan, rather than just a part of it.

  • Great post. The thing I find most frustrating is that we’ve now had a decade of tax cuts from various levels of government all across this country but none of these promised benefits from cutting taxes has ever appeared. And nobody in the media will point that out.

  • Well Robert, as you well know, more of the same keeps these guys in business. So if Dion didn’t want to lead with tax cuts than why did he lead with tax cuts? Effectly he is saying that tax cuts are the way to go because he wants to shore up his flank on the right, you know the ones that always get win win with tax cuts. The rest or the most of us get the crumbs and those kids in poverty, well they don’t vote. Anyway, good post. And Robert is right. Promised benefits is just for the few, meanwhile we have more children living in poverty, crumbling infra structure, municipalities who can’t keep up with the previous downloads, and an environment that just can’t wait.

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