R18: Harper’s Regressive Tax Policy

I’ve hinted at it a couple of times, but I’ll come right out and say it: Harper has established a regressive taxation scheme in Canada. When I was growing up in the 60s and 70s, Canada was known to be quite progressive with respect to taxes. The rich and the bigger businesses paid a higher proportion of taxes than the poor. Exactly as it should be: the rich and big business use more of what our government provides than the poor do, so they should pay more. Even if they’re not using some things directly, the government makes it possible for contented employees to live and get to work, and the rich benefit directly from happy workers being productive. Harper’s taxation is anything but progressive: so workers feel like they’re exploited and aren’t happy, which makes it difficult to go to work, so businesses invest more in employee engagement, and the bottom line suffers. Which means the rich get paid less… which isn’t happening. In actually the workers get paid less, which does nothing for their confidence about their employer, and they feel worse, and the cycle spirals down.

This can easily be seen in the Canadian taxation system. Over the last couple of decades, “Fairness in the Canadian tax system has eroded to the point that the country’s wealthiest citizens now pay a lower total rate than the poorest” (CBC, 2007). And it’s only proceded to get worse under the Harper reign.

There has been two fundamental shifts in who pays taxes in Canada since the late 1990s:

  • A shift of the tax bill from business to families (through large reductions of corporate income taxes and a proliferation of business subsidies and tax credits)
  • A shift of the tax bill from higher income to middle and modest income families (through personal income tax cuts at the high end and an increased reliance on regressive taxes)” (Progressive Economics, 2014)

And yet we keep hearing about tax breaks and money from the government. Don’t they help? Don’t they help the poorest of the poor? Well, no. The poorest are still paying the same hefty chunk that the rest of us do when we pay sales tax and GST (hardly the most progressive taxes), even if they get a refund on their income tax. Then there’s the “tax breaks”::

  • I’ve already explained how income splitting helps primarily the rich and traditional families (Bowles, 2015)
  • Then there’s the Universal Child Care Benefit (Bowles, 2015): which goes equally to all incomes, and doesn’t do much for any: and only if you have a child.
  • There’s the Home Renovation Tax Credit (The Star, 2015). How many people in poverty own their own home? How many can afford to upgrade? Again, it’s mostly to help the rich to get more. Or to make their “more” nicer.
  • And today’s addition: a tax credit for those who adopt (CTV News, 2015). Talk about a tax intended to help the rich! Not that I’m against adoption; I wish more people were able and willing to do it. But that’s exactly it: many couples are struggling to survive and can’t afford to raise a child. They can’t afford the expensive process of adoption, so this does nothing for them.None of these tax benefits help the poor or even much of the struggling middle class; these breaks only help those who can afford things to do more. Like Harper himself.
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2 Responses to R18: Harper’s Regressive Tax Policy

  1. Pingback: R19: Working Income Tax Benefit | The Geographer's Corner

  2. Pingback: R24: Harper’s Economy & Income Inequality | The Geographer's Corner

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