B.C. VIEWS: Perils of an ‘entitlement state’

Quebec is Canada's Greece, Ottawa subsidizes pizza parlours and other harsh realities of our economic situation

Occupy Victoria squat

VICTORIA – With the B.C. and federal governments once again struggling to climb out of deep operating deficits, it’s a good time for the release of Mark Milke’s book Tax Me, I’m Canadian.

An update of the same title published 12 years ago, the book retains the history of taxes in Canada, detailing how Canada’s tax system was initially built to mimic the United States system in the late 19th century.

Beyond the history, it is mostly new material. Included are chapters on the global meltdown of 2009, the surge of pension liabilities as the baby boomers retire and the flawed logic behind the “Occupy” and “Idle No More” protests.

Some readers will immediately note that Milke works for the Fraser Institute and was previously B.C. director of the Canadian Taxpayers’ Federation. But the book is not just an argument for cutting taxes. It also dismantles persistent myths that income taxes are illegal, and launches a broadside on what Milke calls “Canada’s corporate welfare carnival.”

Many people will be able to identify some top names in the government subsidy game: Bombardier, General Motors, even poor old Rolls Royce Canada. Some will also be well aware that our supposedly tight-fisted Conservative federal government has continued to pour out “regional development” and other funds to every part of the country.

But I did not know that Industry Canada grants were handed out to pizza parlours (including the remote pizza-starved village of Kamloops), or to help open gas stations or convenience stores in Kelowna, Vernon and Chilliwack.

Milke makes a useful point for B.C. about royalty rates for timber, natural gas and other resources. They are resource rents, and if they are too high the tenants will move out. Reducing them isn’t a subsidy, especially if it leads to big revenue gains as B.C.’s unconventional shale gas incentives have done.

On the Occupy movement: The infamous “one per cent,” who in Canada earn $250,000 a year or more, earned 10 per cent of all income and paid 20 per cent of all taxes in 2010. The bottom 73 per cent of tax filers paid just 17 per cent of all taxes. About a third paid no tax at all.

(My 2011 commentary on the B.C. Occupy squatters is here.)

On Idle No More: When Attawapiskat Chief Teresa Spence played to the Ottawa media with her soup strike, former Liberal leader Bob Rae suggested a nearby diamond mine should share more revenue.

Milke omits the substantial support and employment that mine provides, and glosses over the misguided blockades that disrupted that and other job-creating enterprises. But he does detail the disastrous effects of passive resource wealth bestowed on impoverished aboriginal communities, and contrasts it with the success stories of reserves that build their own enterprises through hard work.

On public sector pensions: Milke notes that historically, public employees traded higher wages for better benefits and job security. Now their wages are generally higher, and taxpayers have to cover their personal pension contributions (as a portion of those wages) as well as the employer contributions, plus the “defined benefit” payout, which has to be subsidized far beyond what the pension fund can support.

On the debt-financed welfare state, there are memorable observations, like this one: “For the record, the generous Quebec welfare state and its ostensibly more progressive model are paid for in part with the taxes of other Canadians; Quebec is merely the North American equivalent of Greece.”

The recent B.C. political crisis over adoption of the harmonized sales tax showed that there is too much emotion and too little knowledge about how taxes work. This book is a step towards addressing that.

Tom Fletcher is legislature reporter and columnist for Black Press and BCLocalNews.com Twitter:@tomfletcherbc

 

Just Posted

North Okanagan-Shuswap trustee hopefuls state stance on education

Retired teachers association holds forum for School District 83 board candidates

Puff, puff, pass: Cannabis is officially legal across Canada

B.C. has only one bricks-and-mortar marijuana store

New bus route to ‘replace’ Greyhound along Trans-Canada Highway

Rider Express Transportation says they will soon begin a bus service from Winnipeg to Vancouver

Okanagan RCMP detachment hosts recruiting, exam sessions

If you’ve contemplated a career with RCMP, register for sessions at West Kelowna detachment

Shuswap goat delivery way above quota

Hillside Dreams Callekno produced sextuplets, a rare event among goats

VIDEO: First legal cannabis purchases as midnight strikes in eastern Canada

Newfoundland and Labrador was the first province to kick off the sale of cannabis, just after midnight local time

Grant Thornton LLP partners with Drew Lee-Hai

For more than 40 years, the Drew Lee-Hai firm has been serving clients in Salmon Arm and area

Boeser tallies in OT as Canucks beat Penguins 3-2

Vancouver wins without star rookie Pettersson

U.S. pot firm urges Trump to deny Canadian producers ‘competitive advantage’

The challenge for U.S. firms lies in the fact that while recreational cannabis is legal in nine states and medicinal pot in 22 others, it remains illegal under federal law

Mayor of Kamloops says ‘history has been made’ with vote on B.C.’s lone pot shop

The store to be run by the province in B.C.’s Interior is opening Wednesday as pot sales become legal across Canada

Government says imprisoned Canadian terror suspects must face consequences

Public Safety Minister Ralph Goodale showed little sympathy Tuesday for such individuals who now want to return to Canada

How rules for inmate segregation in Canada will change under Bill C-83

Federal government proposing changes to rules around inmates in federal correctional institutions

Airplane crash delays Okanagan Valley aerial mapping project

Aviation tragedy claimed lives of project pilot, aerial mapping technician

Salmon Arm Curling Club teaches how to hit the button

Learn to Curl clinic imparts experience on youngsters and new curlers

Most Read