In Praise of Paying More Taxes
Brandon Sun, April 16, 2018 – David McConkeyIncome tax season again, eh? While people and politicians like to complain about taxes, I would like to propose an alternative. I would like to see more people happily paying more taxes! And I would like to see more political leaders extolling the virtues of paying more taxes!
What the . . . funding? Here’s why. Around the world – and here in Canada – paying taxes helps create good lives: for individuals, for communities, and for countries. It’s partly because paying taxes funds government services. It’s also because paying taxes helps build the involvement, commitment and responsibility of citizenship.
Advanced, desirable countries, like in Western Europe, have high taxes. Poorer, more dysfunctional countries have low taxes. Remember a few years ago when Germany and other countries bailed out Greece? They demanded in return that Greece increase its taxes.
We know that taxes support social services, like education and healthcare. What we may not appreciate as much is that taxes support the infrastructure – from roads to the legal system – for a flourishing free enterprise economy. For example, California – perhaps the most dynamic, creative and entrepreneurial of all U.S. states – has high taxes.
We citizens often misunderstand taxes. We can blame human nature! We prefer taxes that are rather out of sight, like income taxes. We are annoyed by taxes that are very visible, like sales taxes. But economists say that sales taxes are better.
Politicians of all parties fail in articulating and helping us understand the advantages of paying taxes. Politicians like to link the word “tax” to create phrases like “tax burden” or “tax cut.” And politicians like to describe government spending with a euphemism like “investment,” somehow magically separate from the taxes needed to pay for it.
We like to hear our politicians say that our taxes will be reduced. We also like to hear that government services will be increased. We flatter ourselves – and politicians pander to us – by thinking that we deserve to pay less in taxes, but to get more in services.
No surprise that the federal government and every province – regardless of political party in power – usually has a deficit. Politicians seem to remember the first part of the adage that having a deficit is a good thing – during a recession! But did they forget that the last recession was a decade ago? And that getting into practice with a deficit now – in case a recession pops up – is no excuse!
Instead, political leaders have a responsibility to better explain taxes. We also have a responsibility as citizens. We need to reward politicians who speak to us honesty. We need to tell them we can handle the truth!
Another advantage of paying more taxes is to promote good behaviour. The carbon tax is a way to encourage less carbon use and so mitigate global warming. But the federal Liberals are now on a well-worn track: implement just enough of a carbon tax to brag that they are doing something, but not enough to make a real difference.
And Conservative politicians who simply attack the carbon tax are also a disappointment. In dismissing the idea of a carbon tax, Ontario Conservative leader Doug Ford says, “A tax is a tax is a tax.” Uh . . . no. Different taxes have different effects, and we are ill-served by politicians who deceive us in such a basic way.
I would like to comment on one other issue: different taxation for Indigenous and non-Indigenous individuals. Take a look at your T4 Slip. If you are an employed individual, your earnings are taxable, reported in Box 14: “Employment income.” But if you are an Indigenous person working for a reserve-affiliated employer, your earnings are tax-free, reported in Box 71: “Indian (exempt income).”
This system is racial discrimination and deprives workers with tax-exempt income the sense of shared community one gets from paying taxes. Unfortunately, as urban reserves are created in Brandon and elsewhere, more people will have their earnings designated as “Indian (exempt income).”
My ideal? More politicians would be more forthright about the benefits of paying more taxes. As well, more citizens would pay more taxes. And we would be happier about it, too!
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