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

Lacarya ladies golf report for July 10

Weather gods kindly provided a dry afternoon so 15 ladies could play at Lacarya Golf Course

NDP candidate wants to make communities more affordable

Gina Myhill-Jones also counts rich volunteer experience as an asset to her potential as a politician

Back in Time

Historical Perspective

Wells Gray gets voice on provincial tourism council

TWG marketing manager Stephanie Molina recently appointed to Minister’s Tourism Engagement Council

Rich the Vegan scoots across Canada for the animals

Rich Adams is riding his push scooter across Canada to bring awareness to the dog meat trade in Asia

Recall: Certain Pacific oysters may pose threat of paralytic shellfish poisoning

Consumers urged to either return affected packages or throw them out

How a Kamloops-born man helped put us on the moon

Jim Chamberlin did troubleshooting for the Apollo program, which led to its success

Sexual harassment complaints soaring amid ‘frat boy culture’ in Canada’s airline industry

‘It’s a #MeToo dumpster fire…and it’s exhausting for survivors’

How much do you know about the moon?

To mark the 50th anniversary of the first lunar landing, see how well you know space

Body, burning truck found near northern B.C. town

RCMP unsure if the two separate discoveries are related

Couple found dead along northern B.C. highway in double homicide

Woman from the U.S. and man from Australia found dead near Liard Hot Springs

UPDATE: West Kelowna fawn euthanized, not claimed by sanctuary

Gilbert the deer has been euthanized after a suitable home was not found in time

BC Wildfire Service warns wet weather no reason to be complacent

Fire risk currently low for much of B.C. compared to same time over last two years.

Most Read