The Harper Sales Tax and Michael Ignatieff
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A headline in the Globe and Mail this past week said, more or less, that Michael Ignatieff is damned if he does, damned if he doesn’t, whether or not the Liberal party supports the Harmonized Sales Tax (HST) that both Ontario and British Columbia intend to introduce.
Like the GST before it, there are very few tax experts who deny that harmonization is extremely attractive. It is administratively simple and it is a boost to industry. The lesson from the Maritime provinces is that it does not lead to job losses or inflation. On the contrary, it is more likely to create jobs than to lose them. It goes one further step towards a Value Added Tax (VAT), which the countries in the European Union enjoy. Not only does it help exports, it could, if properly implemented, stop annoying people by being buried in the cost of the price of each good and service.
Twenty years later, do I still have to defend the fact that economic activities should be treated on the same basis? You make a widget, the widget gets taxed. You polished someone’s navel, you get taxed for polishing someone’s navel. What’s the difference? All economic activity should be treated the same.
Well, that’s never going to happen, exactly. Children’s clothes, books, feminine hygiene products. Everyone wants an exemption for these items. There is no justification. The solution is to put more money into the hands of the least well off to compensate them for the cost of the tax. The rich can afford to pay the tax on books and children’s clothes. The poor won’t be any worse off if you give them tax rebates equivalent to the amount of tax they would normally spend.
In 1979 Joe Clark’s government had the slogan “Short term pain for long term gain.” Ever since Michael Ignatieff has led the Liberal party, it seems as if his slogan has been, “Short term manoeuvring for no particular purpose.”
He called the HST the Harper Sales Tax. The HST was a needed tax that two courageous provincial premiers were prepared to introduce. All he needed to say was, “This is a good tax. The Liberal Party of Canada intends to support both the Liberal Party of Ontario and the Federal Government.”
The leader of the opposition’s job is simple. He has to keep the government on its toes. Otherwise, he has to support the government’s legislation, UNLESS he believes it is so harmful to the nation that it necessitates a general election.
Like the GST before it, there are very few tax experts who deny that harmonization is extremely attractive. It is administratively simple and it is a boost to industry. The lesson from the Maritime provinces is that it does not lead to job losses or inflation. On the contrary, it is more likely to create jobs than to lose them. It goes one further step towards a Value Added Tax (VAT), which the countries in the European Union enjoy. Not only does it help exports, it could, if properly implemented, stop annoying people by being buried in the cost of the price of each good and service.
Twenty years later, do I still have to defend the fact that economic activities should be treated on the same basis? You make a widget, the widget gets taxed. You polished someone’s navel, you get taxed for polishing someone’s navel. What’s the difference? All economic activity should be treated the same.
Well, that’s never going to happen, exactly. Children’s clothes, books, feminine hygiene products. Everyone wants an exemption for these items. There is no justification. The solution is to put more money into the hands of the least well off to compensate them for the cost of the tax. The rich can afford to pay the tax on books and children’s clothes. The poor won’t be any worse off if you give them tax rebates equivalent to the amount of tax they would normally spend.
In 1979 Joe Clark’s government had the slogan “Short term pain for long term gain.” Ever since Michael Ignatieff has led the Liberal party, it seems as if his slogan has been, “Short term manoeuvring for no particular purpose.”
He called the HST the Harper Sales Tax. The HST was a needed tax that two courageous provincial premiers were prepared to introduce. All he needed to say was, “This is a good tax. The Liberal Party of Canada intends to support both the Liberal Party of Ontario and the Federal Government.”
The leader of the opposition’s job is simple. He has to keep the government on its toes. Otherwise, he has to support the government’s legislation, UNLESS he believes it is so harmful to the nation that it necessitates a general election.
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