Feature

It's Time to Change the Conversation About Taxes

Vivian McCaffrey
cover of Tax is Not a Four Letter WordAlex Himelfarb and Jordan Himelfarb, eds. Wilfrid Laurier University Press, 2013
304 pages, $29.99

This compelling collection of articles takes up the challenge of turning the dial on the negative view of taxes that has come to characterize our political discourse. We’ve reached the point in Canada, including Ontario, where political leaders believe it would be suicide to raise the spectre of higher taxes. Economist Jim Stanford sums up the current conversation about taxes this way: “Taxes are increasingly portrayed as a burden from which government should be granting us relief. No more do we hear about the obligations – and the benefits – of our common citizenship, about how taxes tie us to one another and the common good . . . Gone is the language of citizen, replaced by the atomizing language of consumer and taxpayer.” The Canadian economists, sociologists, and researchers who contributed to this collection take up the task of having an “adult” conversation about what taxes are for and what is at stake if Canadians continue down the path of listening only to those who argue that we can cut taxes or avoid tax reform without serious consequences.

WHAT ARE TAXES FOR?

As described by researcher Trish Hennessy, historically taxes in Canada were used to pay down the deficit incurred during the First World War, finance our nation’s Second World War effort, and then support the infrastructure of our burgeoning cities. In recent times, arguably the most important role of taxes has been to provide the public services Canadians have come to expect and rely on. Public services are not only essential to all aspects of our lives; they contribute to reducing social and economic inequality. As economist Hugh Mackenzie argues: “For the vast majority of Canadians, the loss in value from a dollar not spent on public services is significantly greater than the loss from an equivalent increase in taxes. Why? Because the benefit from public services is distributed roughly equally among all Canadians, while revenue from taxation is not.” Clearly, the work performed by ETFO members to support our public school system is dependent on a robust tax base and public support for paying taxes.

FACTS ABOUT CANADIAN TAXES

Traditionally, Canadians have had a more favourable view of taxes and the role of government than our American neighbours. Recently, however, Canadians have succumbed to a concerted and effective conservative narrative about the need for austerity and lower taxes. Since the 1990s, federal and provincial governments have been reducing both corporate and personal income taxes. Mackenzie points out that Organization for Economic Co-operation and Development (OECD) data demonstrate that, since 1995, tax revenue in Canada has dropped from 36% to 31% of Gross

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