Politics from North of the 49th Parallel
Almost Twice as Many Get Bigger Tax Cut Under NDP Plan
Published on June 23, 2004 By IanGillespie In Politics

We know all about the NDP's 'tax heavy platform'.

We know all about their 'unpopular schemes'.

We'll all pay a lot less taxes under a Conservative government, right? After all, The Globe and Mail's told us so, hasn't it?

Well, guess what?

The sanctimonious corporate shills got it wrong.

They got it wrong again, and again, and again.

Yesterday the Canadian Centre for Policy Alternatives -- having bothered to, you know, read -- published a study comparing the Conservative and NDP tax cut plans. It's findings?

Nearly twice as many Canadian families would get a bigger tax cut under the New Democratic plan:

  • 64% of Canadian families would save more under the NDP's tax cut plan, 36% under the Conservative plan.
  • Families earning $100,000 or less would save an average of $540 under the NDP's plan -- 16% more than under the Conservative plan.
  • Typical Canadian families, those earning between $40,000 and $60,000 a year, would save an average of $690 under the NDP's plan -- 81% more than under the Conservative plan.
  • Is that so hard to understand? People who can't figure this stuff out shouldn't be writing about economics.

    If I didn't know better, I'd think this election were being covered by Yankees!

    A little civilization's all I'm asking for!

    OK (calm down Ian), for those too lazy or incompetent to figure it out for themselves, here are the relevant numbers:

    Income Group

    Pop. (mil)

    Pop. (%)

    Total Income Tax Savings CP (mil)

    Total Income Tax Savings NDP (mil)

    Min - 20K

    2.96

    19.8

    241

    500

    20K - 30K

    1.83

    12.3

    211

    763

    30K - 40K

    1.52

    10.2

    235

    720

    40K - 50K

    1.21

    8.1

    333

    798

    50K - 60K

    1.08

    7.2

    541

    782

    60K - 70K

    0.91

    6.1

    725

    829

    70K - 80K

    0.90

    6.0

    1,024

    780

    80K - 90K

    0.82

    5.5

    1,160

    716

    90K - 100K

    0.67

    4.5

    1,046

    530

    100K - 150K

    1.94

    13.0

    4,039

    902

    Over 150K

    1.09

    7.3

    3,663

    -1,831

    All figures based on party tax plans once fully phased in.

    As one can see families making $70,000 and below (64% of the population) realize greater gains under NDP's tax plan, while families making above $70,000 (36% of the population) do better under the Conservative plan.

    Simple addition shows that 11.89 million Canadian families earning $100,000 or less would receive $6.42 billion dollars in tax cuts under the NDP's plan, but only $5.52 billion under the Conservative plan. This yields an average tax cut of $540 a year under the NDP's plan and just $464 a year under the Conservative plan.

    Likewise, the 2.29 million Canadian families earning between $40,000 and $60,000 would receive $1.58 billion dollars in tax cuts under the NDP's plan, but only $874 million under the Conservative plan. Again, this yields an average tax cut of $690 a year under the NDP's plan and just $381 a year under the Conservative plan.

    (The Liberals, of course, have no plan to reduce taxes on low- and middle-income families.)


    Comments
    on Jun 24, 2004
    How does the NDP justify a massive tax increase on the top income bracket?
    on Jun 24, 2004
    Because they are on top?!?
    on Jun 24, 2004
    Historyishere,

    They are on top; they should have to pay the most? How much of their money should they be able to keep? Better yet, why not take it all? Think of all the tax breaks you could give everyone if you just took 100 percent of the richest income, hell, no one else would need to even pay taxes for a year that way. If you think 100 percent to too high...what is the correct percentage you think people who do well for themselves they should be able to keep? How much should the middle class have to pay? What about the poor?

    In the US for example-

    The top 5 percent of all wage earners play over 55 percent off all taxes-
    The top 10 percent pay 65 percent of all taxes.
    The top 50 percent of wage earners pays more then 96 percent of all taxes.

    I think this is a totally unfair system we have in the US. The top 50 percent don't even use 50 percent of government services yet they have to pay over 96 percent of them. I also think the Government taking more then 1/3 of your total income is immoral (like the top earners must pay here.) Yet I wonder what it is in Canada?

    3 years a go in the US, there was talk about taxes as well. One side complained that Taxes cuts favored the rich and showed the average rich person would save 5k a year, while the average poor person got only a few hundred dollars. Yet, 3 years later, the rich pay even more of the tax burden of the total US tax base (by 2 percent.) Amazing!

    As a US citizen, I really want to see Canada better off then where they are now. Even if Canada wanted to help us bring democracy to the world, and get rid of harsh and evil dictators, they could not do it in their current state. Your Economy is weak, your military is even worse. I am not trying to kick a dead horse while it's down here, but, I live in the only super power in the world. We have greater economic growth then all of EMEA, then Canada, then anywhere other then China. We spend more on our Military then the rest of the world combined. We account for almost 50 percent of the worlds GDP. My question to you is why? Do we just have that much more resource then anyone else? Do we cheat and steal from everyone? The answer is we work harder, keep tax rates low, and give people freedom (both in rights and economic freedom.) Canada cannot keep taxing itself out of prosperity. You can't keep holding people that want to become successful and rich down so they can prop the underachiever’s/slackers afloat. In watching your election's up there, I am very excited you guys might be able to start down the right road. People must be able to dream, and to do great things. Taxing the people that want to do the most is not the right answer, and is Polly why you guys are where you’re at now.

    The Wardie
    on Jun 24, 2004
    Ian,

    The Centre for Policy Alternatives statements have to be taken with a grain of salt, typically. They are the opposite of the Canadian Taxpayer Federation, another group that is driven by ideology - thus, I take their statements too, with a grain of salt. The CD Howe Institute regularly provides more reliable information than those two organizations.


    The Wardie,

    Even if Canada wanted to help us bring democracy to the world, and get rid of harsh and evil dictators, they could not do it in their current state. Your Economy is weak, your military is even worse.


    In terms of our military, yes, it's pretty weak, no denying that. However, notwithstanding that, we've helped get rid of dictators lately, we were there in Bosnia, we ARE there in Afganistan and, despite some popular misconceptions, and we ARE providing some logistical support in Iraq.

    In terms of our economy, you are dead wrong there. Our economy is not weak; it's one of the strongest of the G8 nations, and the only one where we have a national budgetary surplus (and have had for the past seven years!) and are actively paying down our national debt, rather than incurring more, like ALL the other G8 nations (USA obviously included). We've gone from a 70% national debt to GDP ratio, to 44% - and this is continuing on a downward trend. Further, our national pension plan is one of the few G8 plans on sound footing. The US pension plan, by contrast, is a diaster just waiting to happen.

    What's EMEA? I typed it into Google and can't seem to find whatever you're alluding to. ...

    Jay
    on Jun 24, 2004
    The CD Howe institute is more moderate, but far more partisan -- big-L partisan.

    The CCPA is certainly ideological, but I've read enough of their stuff to know how accurate it is, and it is very accurate.
    on Jun 24, 2004
    EMEA, short for Europe-

    Lets just end off at your military is weak, I will give Canada the symbolic gesture of military support in afgan, what you could bring to Bosnia, and the limited support you could give to Iraq. The good news is, The US will never let anything happen to you, and you guys know that (just like Europe knows it)

    You think your economy is in good shape? hhmmmm

    US-
    GDP- 38k per capita
    Total GDP- 11 trillion
    Growth rate- 3.1 percent (2003)

    Canada
    GDP- 29k
    Total- GDP- 950 Billion
    Growth rate- 1.6 percent (2003)

    *stats from http://www.cia.gov/cia/publications/factbook/geos/us.html

    The only real important number here is the growth rates. 1.6 is a good growth rate for Europe, and a very bad one compared to the US. This means the US is pulling away from Canada, and that Canada is catching up and closing the gap. Today you closer to the US then you will be tomorrow, and you were closer to the US yesterday then you are today. Taxing your most intelligent, your best workers, those who do the most for your economy, best and brightest is not going to help you compete at the global level. The world is opening up, how well can Canada compete? The best example I can use is hockey. This year Canada did well considering how little they can afford to spend on players getting to the big dance. But it might be a long time till we see another team from up north even have a shot at the greatest prize in all of sports. The only way they have a shot is to "level" the playing field by making US teams spend less, a solution that will not work for other economies in the global market. Lets be honest, like the US, labor rates are not cheap there, so what are you going to being to the table in order to make Canada a continued power. My hope is a system that allows for you to create wealth, and give every person in your country a reason to excel. Again, it looks like Canada is starting to go that way. I can’t wait to see it. A strong Canada is in everyone’s interests. US in the States share a very close bond with Canada and the UK. The NDP tax plans sure look like plan socialism to me, and if Canada is going to go that route, then they would be relevant much longer.




    on Jun 24, 2004
    The Wardie,

    One reason the NDP has such a low level of support, rarely breaching 20%. People see them as a tax and spend regime.

    In terms of our "weak economy" - yes, maybe a little weaker in 2003 than the US, but here's a fuller quotation from your CIA sourcebook, showing a longer term growth average ...

    "As an affluent, high-tech industrial society, Canada today closely resembles the US in its market-oriented economic system, pattern of production, and high living standards. .... Real growth averaged nearly 3% during 1993-2000, but declined in 2001, with moderate recovery in 2002-03. Unemployment is up, with contraction in the manufacturing and natural resource sectors. Nevertheless, given its great natural resources, skilled labor force, and modern capital plant Canada enjoys solid economic prospects."

    Doesn't sound like a "weak economy" to me. Maybe we aren't quite as good as the US in terms of economic growth, nevertheless, that's not the only country in the world. Against most other G8 nations, we're doing quite well, thank you. And without the future drag of deficits (as the other seven countries have), this will continue to buoy our prospects even further.

    If you want to look at long-term economic problems, ours our diminishing. The two major parties are committed to reducing taxes (over different time frames and by different amounts), and the party governing our land for the past decade has shown they're committed to fiscal responsibility. Things are looking up here, friend, and believe me, that's a significant turn-around from the early 1990's, when things look very grim indeed.


    JW
    on Jun 24, 2004
    Wardie,

    Interestingly, the CIA sourcebook points to another problem likely to attract more and more attention in the US ....

    (THESE QUOTES RELATE TO THE USA)

    "The onrush of technology largely explains the gradual development of a "two-tier labor market" in which those at the bottom lack the education and the professional/technical skills of those at the top and, more and more, fail to get comparable pay raises, health insurance coverage, and other benefits. Since 1975, practically all the gains in household income have gone to the top 20% of households."

    and ... "Long-term problems include inadequate investment in economic infrastructure, rapidly rising medical and pension costs of an aging population, sizable trade and budget deficits, and stagnation of family income in the lower economic groups."

    It will be interesting to see if the politico's there can continue to drum up support for policies that seemingly benefit relatively few people. People might begin to think that the really low taxes there (and they are, if you examine the pattern of global taxes), aren't really helping out a lot of people. I personally don't know if this is the case, but many might begin to postulate that.

    JW

    on Jun 25, 2004
    Quote "It will be interesting to see if the politico's there can continue to drum up support for policies that seemingly benefit relatively few people. People might begin to think that the really low taxes there (and they are, if you examine the pattern of global taxes), aren't really helping out a lot of people. I personally don't know if this is the case, but many might begin to postulate that.--JW "

    The ring wing in Canada (new conservatives) believe people should keep more of their money, that they are smart enough to take care of their own money. They suggest tax cuts to U.S level or lower. They suggest that our serices should be privatized.

    What I don't get is how these right wing can't learn from other mistakes. Take auto insurance for example. It was once a public service owned by the government and it was affordable. Today its owned by a private company who make record profits, yet the average Canadian today now can't afford auto insurance. Many are driving without insurance. Some people are not making claims to their insurance company cause their afriad of their premiums increasing.

    As for tax cuts and letting people take care of their own money. What doesn't make sense is what this tax cuts means for people who are in a situation where society can't provide them with work.

    Kevin
    on Jun 25, 2004
    Quote "It will be interesting to see if the politico's there can continue to drum up support for policies that seemingly benefit relatively few people. People might begin to think that the really low taxes there (and they are, if you examine the pattern of global taxes), aren't really helping out a lot of people. I personally don't know if this is the case, but many might begin to postulate that.--JW "

    The ring wing in Canada (new conservatives) believe people should keep more of their money, that they are smart enough to take care of their own money. They suggest tax cuts to U.S level or lower. They suggest that our serices should be privatized.

    What I don't get is how these right wing can't learn from other mistakes. Take auto insurance for example. It was once a public service owned by the government and it was affordable. Today its owned by a private company who make record profits, yet the average Canadian today now can't afford auto insurance. Many are driving without insurance. Some people are not making claims to their insurance company cause their afriad of their premiums increasing.

    As for tax cuts and letting people take care of their own money. What doesn't make sense is what this tax cuts means for people who are in a situation where society can't provide them with work.

    Kevin
    on Jun 25, 2004
    We account for almost 50 percent of the worlds GDP


    Actually around a quarter.


    I don't understand why Americans bash Canada so much. Sure it's got a weak military, but for crying out loud, it's got tenth of the US's population. There's no reason for it to have a military comparable to ours. And Canada has most certainly done it's fair share in the wars of this century. Canada made quite significant contributions relative to its size.
    on Jun 25, 2004
    Thanks "vincible" for putting things into perspective for those who have a hard time looking above their own arrogance.

    Kevin
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