Today's discussion:

Canada just started the largest tax increase you’ve never heard of

Overall, the effective tax rate placed on new investment in Canada is set to increase from 13.7 percent to nearly 17 percent. This will lower investment and productivity at a time when we need more of both.

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Comments (27)

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Michael B

We can only hope that the younger generations appreciate what the ruling partnership is doing to them. Not “for” them, but “to” them.

16th May 2024 at 7:30 am
Kim Morton

An outsider viewing what the current government is doing to the country might rightfully think the goal is to destroy the economy.

16th May 2024 at 9:25 am
Paul Attics

Such a theory would then prompt anyone with any curiosity at all to ponder why the goal might be to “destroy the economy”. A split second later they would conclude that this is silly and obviously not the goal.
Incompetence, corruption, and/or misplaced priorities are reasonable possible explanations for the actions/inactions of current Federal and Provincial governments that are harming our economy.

16th May 2024 at 9:56 am
Dave Collins

I agree with your second paragraph, re incompetence, corruption, and/or misplaced priorities.
Re why destroy the economy, simply consider the objectives of WEF, of which Trudeau and Freeand are supporters. Their push for globalization is not necessarily in Canada’s best interest.

16th May 2024 at 11:31 am
Paul Attics

Assuming that your implied perception of what the WEF is about (principles, goals, actions) is accurate, can you draw a direct connection with how the willful destruction of the Canadian economy helps achieve those goals?

16th May 2024 at 12:17 pm
Murray Sondergard

And so continues Canada’s descent into international irrelevance. As Margaret Thatcher famously said, the problem with socialism is that you eventually run out of other people’s money.

16th May 2024 at 9:47 am
Paul Attics

The problem with socialism is a lack of understanding of socialism, and a failure to understand the benefits of socialism in a a complex society that effectively combines aspects of capitalism and socialism to produce happy and prosperous societies.

16th May 2024 at 11:26 am
RJKWells

Try living under socialism, Paul, then come back and tell us how you feel about that ideology.

That is, if they’ll let you out to share your experiences…

16th May 2024 at 2:06 pm
Paul Attics

Good grief! Read what I wrote and at least take issue with the words as written – “…effectively combines aspects of capitalism and socialism to produce happy and prosperous societies.”.

Socialism is not an off/switch. There is a world of difference between socialistic aspects of society, our society (public education and healthcare), and a fully socialistic state (government owns and operates everything).

16th May 2024 at 2:39 pm
Michael B

Venezuela, Cuba etc…..

16th May 2024 at 12:43 pm
Gail

Future generations will be feudal rich and poor no middle class to balance living. It seems the Hunger Games was more than a fictional movie.

16th May 2024 at 9:32 am
Ed

We really DO need Katniss Everdeen !

16th May 2024 at 11:28 am
Paul Attics

It is all right there in the final sentence…
“…the whole system of raising public funds in Canada needs a good, hard look.”
Narrow taxation changes for short-term political purposes is a huge ongoing multi-partisan roadblock to a prosperous, stable, and fair tax regimes (federal, provincial, municipal). Alas, a tale as old as taxation.

16th May 2024 at 8:56 am
Greg Jackson

Increasing productivity and the standard of living in the country can hardly be characterized as being for narrow, short-term political purposes. Capitalism creates wealth, by producing products and services that people are willing to pay for. The government taxes both the profits of the company and the earnings of the employees. Those funds are the only source of new money for the government to spend. When the government takes too much, the capital, (jobs, investments, etc.) goes elsewhere. This reduces the available funds for the government to spend, so they borrow, putting the economy in a deficit, and so the downward spiral begins and continues until one of two things happen Either the government changes the tax regime to increase capital investment, or the country turns into a socialist paradise, where only the elite thrive and the rest starve, like North Korea. Freedoms are taken so that no one dares to criticize the Dear Leader and we are penned up forever.
It always goes the same way. It’s human nature. Only capitalism provides a sustainable economy that can support the government’s need for money, while also returning a profit on the investment and providing employment and a good standard of living for the citizens.
In Canada our economy has become inverted. The government is employing more and more people who create no monetary input to the economy. This is unsustainable.
I

16th May 2024 at 2:03 pm
Paul Attics

It seems like you are saying that we either have capitalism OR socialism. It is obviously a combination of both to keep the “prosperity engine” running smoothly. The government is moving dials to make this happen, either effectively or not.

It is ridiculous to cite failed states like North Korea and near-failed states like Venezuela and Cuba as the measure of comparison for Canada’s ongoing mix capitalism and socialism.

There is certainly a compelling argument that our current Federal government has set the dials poorly and we are on a negative prosperity trend.

16th May 2024 at 2:48 pm
RJKWells

It’s only ridiculous to those who’ve never had to experience firsthand the effects of socialism, Paul (and I did read your other comment fully before responding earlier).

I’m mindful of the saying, “You can vote your way into socialism but you have to shoot your way out.” Once they have you in its grip, socialists will do any and everything to ensure they’re the ones who remainin control. And if they have to bury you, that’s the price they see being paid. 20th century history is littered with bodies of millions who found out the hard way.

Ours is a free-market society feeling the ever creeping effects of socialism and growing state intervention. Try as you may to spin that one, I know of no successful society based on a hybrid capitalist/socialism model. Full stop.

16th May 2024 at 11:03 pm
Greg Jackson

Ask the average person on the street in China how that combination is working.

16th May 2024 at 2:58 pm
Kevin S

Here is an anecdote. My friend’s daughter was in Science in UofC . Every course had labs. She dropped as her lab partners would not speak English in the labs. Personal experience. My young daughter sits in a pod of 4 desks in Grade 5. Half the class are ELL. Her current pod members speak zero English. Note there are no extra Aids for the teacher. There are people here that have never had to learn either official language. Satellite TV and radio, internet newspapers from the old country, and ethnic stores and daycares. The Salad Bowl is going to fail Canada. Time for the melting pot.

16th May 2024 at 12:15 pm
RJKWells

Any politician claiming they intend to make the taxes they take from us fair should be called out for the charlatans they are. That they can even talk about fairness with a straight face confirms they really do think we are the gullible paupers they intend on turning us into.

How about a special parliamentarian tax? Claw back a significant portion of the pensions that they have bestowed upon themselves until those we elect next year have turned around what those there before them have done to our finances.

A token amount to be sure, but an important signal to taxpayers that the hard times we are all about to head into will be felt by parliamentarians too. I’ll bet that many might not be inclined to retire, instead motivated to stick around to finally do some of the heavy lifting we’re going to need to get our economy back on track.

Now that would be fair – as in turnabout is fair play.

16th May 2024 at 10:44 am
Wolf R

It looks like we are on the way to a socialist society. A bloated bureaucracy and more and more control over the people that create wealth in the country. Freedom of speech curtailed on top and what do we have?

16th May 2024 at 9:42 am
Sandra

get ready to live in slums

16th May 2024 at 10:27 am
Harriet

Along with the Carbon Tax, this is just about all business in Canada can take,

16th May 2024 at 8:18 pm
Valerie

I’m not sure growth is a way out of, or a substitute for, the “generational fairness” question. Growth matters, but it’s not an answer for why many young people are so much worse off than previous generations despite merely stagnating real incomes. (Young people didn’t get put on the RCMP potential unrest list because of ‘dismal growth’ in their standard of living! It’s active decline.) The question about where that income is going is inherently a distributional one, even if it’s arguably coming more from rent-seeking on housing than pre-existing government redistribution towards seniors.

Growth is not even much of an answer to making it easier to pay for an aging population, unless we are willing to let benefits become less generous relative to wages indefinitely. Even healthcare spending is dominated by wages which will likely face upward pressure if productivity increases in other sectors. The distributional questions are not going away.

16th May 2024 at 2:57 pm
Lauraine

The author writes from a place of yesterday. If manufacturing tax is set to be so regressive, why is Honda investing billions, VW, investing millions in this country?? There is something short sighted here.

16th May 2024 at 10:12 am
Sandra

with the help of our money

16th May 2024 at 10:26 am
don morris

Honda and the rest are investing here because of huge grants and loan guarantees from our federal government.

16th May 2024 at 11:12 am