A very scary PM: ‘I don’t believe that any taxes are good taxes’

[Tonington]

'no taxes are good taxes.'

I find it somewhat hard to disagree with that sentiment. If you disagree with that statement, please list the taxes that you feel are 'good' taxes, and explain why they're good.

Efficient taxes are good taxes.

To say no taxes are good taxes is an irrelevant conclusion, unless you're an anarchist. The fact that is in dispute is an efficient tax system, one that can provide the necessary revenue to run the state, without compromising the markets through negative distortions.

 

[Machjo]

What taxes are good taxes?

Hard to say. As I'd mentioned above, it would be theoretically possible to have a tax-free society, but it would mean more fines, user fees for government services, etc. So which would be preferable between these alternatives? Debatable.

As for taxes, all in moderation. I could see some value in moderate income taxes and wealth taxes as a means of redistributing wealth between rich and poor (as getting rich requires not only effort but luck, and some poor are poor in spite of the same effort, just owing to bad luck), but only if such taxes are moderate.

Though even then, I think I'd prefer scrapping even them and let myself give that money to a charity of my choice.

Who knows, maybe I do lean more towards the tax-free model. Not decided yet. But I can't say that all taxes are necessarily bad until I think about this a little more.

 

[Machjo]

Efficient taxes are good taxes.

To say no taxes are good taxes is an irrelevant conclusion, unless you're an anarchist.

Not necessarily true. Revenue from teh sale of Crown resources, fines, user fees, etc. There are plenty of sources of government revenue besides just taxes.

By the way, I belive Saudy Arabia is a tax-free country if I'm not mistaken, with most of its money coming from the sale of Crown resources (i.e. petroleum).

 

[Liberalman]

Harper is a douche

I agree

 

[Liberalman]

Oh yeah, well, Iggy's a douchbag; so there.

I disagree

 

[Liberalman]

If Harper doesn't like taxes then let him bring in user pay when he does that then Canada will become a third world country.

 

[Tonington]

Not necessarily true. Revenue from teh sale of Crown resources, fines, user fees, etc. There are plenty of sources of government revenue besides just taxes.

So, the answer is to sell off Canada, fine more Canadians and for more dollars, and increase user fees to keep the state afloat? Have you costed out what that would entail, just for the very basics of Canada's spending priorities? What would you consider basic?

Soon you run out of Canada to sell, or you're fining Canadians for breathing, or charging $2000 for a drivers license, which most people would probably call a tax.

By the way, I belive Saudy Arabia is a tax-free country if I'm not mistaken, with most of its money coming from the sale of Crown resources (i.e. petroleum).

I don't know if you've noticed, but Alberta has a fairly vocal opposition to that kind of idea, including threats of separation.

We're also not an absolute Monarchy like the Saudis have, so dictating to provinces isn't going to work.

 

[TenPenny]

We will need government even if things were perfect, TenPenny. Even in a perfect world, how do you organize commerce, education, defense, law and order without government?

In a perfect world, without government, who becomes the police? The strongest? The most astute? The biggest? What do you do for money, do you barter?

If you are talking of a perfect world and Adam and Eve type of existence (hunter gathering society), it may be possible. Anything more advanced than that, you do need government, no matter how perfect your world is.

The only way you can do without government in a perfect world is only if you change the human nature and make that also perfect (even then it may be difficult). Otherwise, forget it.

You're having trouble with the concept of perfect, I see.

 

[JLM]

Not necessarily true. Revenue from teh sale of Crown resources, fines, user fees, etc. There are plenty of sources of government revenue besides just taxes.

By the way, I belive Saudy Arabia is a tax-free country if I'm not mistaken, with most of its money coming from the sale of Crown resources (i.e. petroleum).

I agree with your first three words. In the early days of the 20th century there were very few taxes, no income tax before WW1. Not much in the way of safety nets either and life expectancy was about 50. I guess it all depends on what society wants & everyone wants something a little different. I think it's definitely time to be scaling back, there is far too much gov't. and unnecessary bureaucracy. One of the things I find so frustrating today is the waste. How much money is spent today on studies? We spent millions on a study of the healthcare system by one of the ex premiers. What did he come up with? Did we adopt any of his recommendations? I think there are far too many meetings at all levels. I guess we all know what the problems are but none of us know all the answers. Canada is basically a resource and product based country. Most of our efforts should go toward extracting the resources and making the products with a few frills like care of our children, stifling crime, locking up dangerous criminals. A lot more emphasis should be put on getting people to care for their own health. This business of living a lifestyle that puts us on the brink of death and then spending $billions at the last minute to postpone the inevitable has got to stop. I think the gov't is doing one thing right- recognizing an unhealthy environment and looking for ways to clean it up.

 

[Walter]

If Harper doesn't like taxes then let him bring in user pay

Consumption tax is the best kind of tax.

 

[JLM]

Consumption tax is the best kind of tax.

That's probably right, much easier to collect than income tax, no loopholes and the result will be similar in that those with the higher incomes generally do more consuming. Also you get to make the choice about how much tax you are going to pay.

 

[Niflmir]

Income tax is a good tax. And heck I would do away with it if I knew a better way.

Seems to me, when you own a condo, you pay a fee for certain services that you may or may not use. You probably don't want litter accumulating around the premises. I imagine you want the halls vacuumed, the windows washed and a security system. Even if you don't want them you benefit and should pay if you live in said condo.

Well, the same is true of society. Even if you don't send your children to public schools, you benefit from other people going to them. How about public roads? Would you prefer to have to pay a toll every other kilometer as you enter a new company's demesne? Heck, we have a limited supply of land, so they are going to be the only game in town, why would they bother with upkeep?

I personally don't like cyanide with my cheerios. Maybe some individuals disagree and think that we shouldn't be paying taxes to ensure that the products we consume are safe. Those chinese baby care products that flood into our markets are a free enterprise beauty to some. The dead children part of the what causes the market to reject inferior products.

True the journalist played out the semantics a little much, but the political points were good ones.

 

[SirJosephPorter]

That's probably right, much easier to collect than income tax, no loopholes and the result will be similar in that those with the higher incomes generally do more consuming. Also you get to make the choice about how much tax you are going to pay.

Not quite true, JLM. If government taxes consumption, then it will discourage consumption, consumption will go down, hurting the entire economy.

If a rich man has to pay say, 30,000 or 40,000 tax on 100,000 dollars Rolls (currently he pays perhaps 13 or 14 % GST+PST, but with no income tax, it could easily become 30,000 or more), he has a big incentive not to buy a Rolls, but try to do with a Camry. Or perhaps buy a new Rolls every other year instead of every year.

Spending by upper middle and rich classes will definitely drop sharply if there is a huge sales tax. I think that way lies economic ruin.

I think it is much fairer to tax income, rather than expenditure. With income, even after paying the tax, a person has more left in his pocket after working than before working. So unless taxes are punitive, income tax does not act as an incentive against working. However, a consumption tax will act as an incentive against consumption.

 

[JLM]

Not quite true, JLM. If government taxes consumption, then it will discourage consumption, consumption will go down, hurting the entire economy.

If a rich man has to pay say, 30,000 or 40,000 tax on 100,000 dollars Rolls (currently he pays perhaps 13 or 14 % GST+PST, but with no income tax, it could easily become 30,000 or more), he has a big incentive not to buy a Rolls, but try to do with a Camry. Or perhaps buy a new Rolls every other year instead of every year.

Spending by upper middle and rich classes will definitely drop sharply if there is a huge sales tax. I think that way lies economic ruin.

I think it is much fairer to tax income, rather than expenditure. With income, even after paying the tax, a person has more left in his pocket after working than before working. So unless taxes are punitive, income tax does not act as an incentive against working. However, a consumption tax will act as an incentive against consumption.

I doubt if our economy is depending on the people who buy Rolls Royce, and I doubt if the number of people who buy Chevs and Hondas is going to change all that much. Also without income tax people will have about 20-25% more disposable income, so after a short initiation period spending will probably return to previous levels. Maybe if people did spend less and paid off more debt there would be fewer bunkrupcies.

 

[dumpthemonarchy]

Dumpthemonarchy, that is really one of the reason why lately conservatism has been synonymous with ‘borrow and spend’. Conservatives do not like any taxes, they especially don’t like taxes on the rich.

They are always trying to cut the taxes (witness the huge tax cut for the rich that Bush enacted as soon as he got in power). When you don’t have tax revenue coming, the only way you are going to spend is by borrowing. That of course shoots the budget deficit through the roof.

Thus Bush inherited healthy surpluses, he converted that into huge deficits. Harper inherited health surpluses, he converted that into huge deficits. Indeed, if you look at almost any conservative leader, he has managed to shoot the deficit through the roof. Can you think of any conservative leader who has balanced the budget? I cannot.

And one of the main reasons for that is that conservatives don’t’ like taxes, they try to cut taxes. When you don’t have taxes, you have to borrow to spend. So just as left is known as ‘tax and spend’. Right is known as ‘borrow and spend’. In economics, as in anything else, it is the centre that is the sensible one.

Yes, the Harperites seem to have started a trend here and are dutifully following the US right. They all hate govt and want it eliminated in all ways possible. Call it anarchistic globalization perhaps.

Colpy, blame the Liberals for deficits? No wonder the Liberals are called the Natural Governing Party. The Conservatives just don't feel legit about governing. Their vision is just so narrow, it makes for an immature democracy. The Liberals ain't great, but they have slightly more going for them than Conservatives.

 

[SirJosephPorter]

I doubt if our economy is depending on the people who buy Rolls Royce, and I doubt if the number of people who buy Chevs and Hondas is going to change all that much.

I think it will change substantially, JLM. Same as a Roll will have taxes of 30 or 40 % tacked on to it, same applies to a Camry, Honda, or indeed any car. At present there is 13 or 14% GST/PST. Add on another 15 or 20 % because the income tax, property tax, health premiums etc. are abolished and we are looking at a tax of 30 to 40% on just about everything.

I doubt that the average person will consider the increased income when buying the car. He will only see that for a 30,000 $ car, he has to shell out another 9000 or 10,000 and that will put him off. Either he may postpone buying or he may decide to do with the old clunker.

Generally, when government taxes something, the consumption of that commodity goes down. Indeed, that is the whole idea behind taxing cigarettes. Tax all the consumption, and all the consumption goes down.

 

[Tonington]

Generally, when government taxes something, the consumption of that commodity goes down. Indeed, that is the whole idea behind taxing cigarettes. Tax all the consumption, and all the consumption goes down.

Elasticity. Learn it.

If a tax is applied to all goods, then it's not really going to reduce consumption, because the price of everything is scaled. Tobacco isn't all that elastic, because the people who buy it are addicted...

 

[dumpthemonarchy]

Elasticity. Learn it.

If a tax is applied to all goods, then it's not really going to reduce consumption, because the price of everything is scaled. Tobacco isn't all that elastic, because the people who buy it are addicted...

Having ciggies cost about $8 a pack has reduced consumption to a degree. Who can afford to smoke 3-5 packs a day like people did 30 years ago? In the old days, smokes were $2 pack.
5 packs x $8 = $40 x 30 days = $1200/mo. Yikes. Couldn't afford any gas for the SUV then.

Even the addicted have to smoke much less these days.

 

[SirJosephPorter]

Having ciggies cost about $8 a pack has reduced consumption to a degree. Who can afford to smoke 3-5 packs a day like people did 30 years ago? In the old days, smokes were $2 pack.
5 packs x $8 = $40 x 30 days = $1200/mo. Yikes. Couldn't afford any gas for the SUV then.

Even the addicted have to smoke much less these days.

Indeed. If all consumption is taxed, people will learn to do without (which actually may not be a bad thing, but it will be terrible for the economy). They may put off buying that car for a year or two, may wait to buy clothes for the fall fashion rather than the spring fashion etc.

Personally I don’t see it doing the economy any good. I don’t think it has been tried in any country. Even in USA, a politician talked about it every now and then, but neither party has taken the idea seriously.

 

[dumpthemonarchy]

That's probably right, much easier to collect than income tax, no loopholes and the result will be similar in that those with the higher incomes generally do more consuming. Also you get to make the choice about how much tax you are going to pay.

Consumption taxes are the best because they are progressive. The rich pay more because they buy more and the less well off get rebates like now.

Harper, buy cutting the GST two points, cut the wrong tax, and most economists criticized him for it. And now those revenues would come in very handy to lower the deficit. He got the pitchfork populists on his side, which aren't enough for a majority. He hates govt, and his words and actions state this very clearly. So he'll never get a majority.