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

RDOS issues 405 building permits in first nine months of 2019

Construction activity higher this year than during same period last year

Voting locations ‘not going to be perfect’ says Elections Canada

The Princeton Legion was a busy place this weekend, as advance polls… Continue reading

Princetons caboose battle pulls back into court

Princeton’s historic caboose rolled back into court last Thursday, with the Vermilion… Continue reading

Kelowna Liberal, Conservative candidates at odds on economic issues

The mortgage stress test and deficit spending were hot topics at an early morning forum

Princeton suffers highest per capita rate of drug deaths: Coroner report

Princeton has suffered the highest number of illicit drug related deaths in… Continue reading

Election 2019: Robert Mellalieu — Green Party candidate for Central Okanagan-Similkameen-Nicola

Robert Mellalieu is running for the Green Party in Central Okanagan-Similkameen-Nicola

North Okanagan patients benefit from new staff and equipment

New physiatrist and much-needed equipment at VJH

Growing cherries, apples, pears — and big pumpkins

Boerboom worked to produce a massive melon from his Summerland farm

West Kelowna resort denies being fined after six bears destroyed

‘We are good with the compliance,’ said the resort’s operations manager

Workshops give North Okanagan businesses a boost

Small Business Week celebrated by Community Futures

Shuswap voter unhappy with polling times that don’t allow him to vote

Resident thinks with technology available polls should be open more days

Ready, aim, fire: Penticton residents invited to shoot exploding pumpkins

The event is hosted by the Penticton Shooting Sports Association on Nov. 2

Police investigating suspicious fire at Airport Inn in Lake Country

Twenty-four firefighters responded to the call around 2 a.m.

Penticton Fire Department says farewell to Cpt. Glenn Beierle

Beierle retired on Oct. 17 following 30 years of service with the department

Most Read