Re: Taxes are killing us.Apr 21st, 2010
You're right that the GST is likely less progressive than income taxes. But that can be remedied in various ways. No point throwing the baby out with the bath water. For example, the money collected could focus more on the most vulnerable, or co-determination laws and other such laws can help to redistribute wealth too. The NDP criticized the Greens and Liberals ferociously over the Green shift on the grounds that it would penalize the most vulnerable of Canadians. The Greens and Libs, though acknowledging this weakness, countered that it could be corrected the same way the GST by sending it back to the poorest. It still serves as a means of encouraging saving. I'd say replace the GST with a resource tax and reduce income tax too while we're at it. That way, there's be a natural incentive built into the economy to use our resources more efficiently.
No doubt this could be corrected, but I doubt Harper took any steps to help the poor (e.g. by increasing the GST rebate).
I think there is a lot to be said for value added tax, like they have in Europe. With VAT in general, the more expensive something is, the more it gets taxed, percentage wise (since it has more added value, and value may be added more than once during the processing). I think VAT is more progressive than GST. And of course there is no VAT on essentials.
Also since VAT is hidden, folded into the price of the article, it is not visible to people at large and hence does not cause aggravation. If you see that the price of the car is 30,000 $ and you must pay 4500 $ tax on top of that, that causes much more aggravation, much more anger than if the price of the car is 34,500 and no taxes to pay.