Thursday, March 18, 2010

Well said

Erin points out the absurdity of the McGuinty government's attempt to justify imposing the HST on the province:
(H)armonization will reduce annual revenues by $0.7 billion because the input tax credits paid to business ($4.5 billion) exceed the net additional tax paid by households ($6.1 billion - $2.3 billion). The corporate income tax cut will reduce annual revenues by a further $2.4 billion. To quote McGuinty again, “Our tax reforms, in fact, cost the treasury billions of dollars.”

King Louis XIV’s finance minister, Jean Baptiste Colbert, famously quipped, “The art of taxation consists in so plucking the goose as to get the most feathers with the least hissing.” Conversely, the McGuinty government has managed to provoke a full-blown tax revolt without gaining any additional revenue.
What's most remarkable about the current discussion is the fact that McGuinty is trying to paint the fact that the HST will "cost the treasury billions of dollars" as a plus even as a wave of deficit hysteria is spreading across the country. But while there's little sense that even the admission that he's voluntarily damaged Ontario's fiscal position will change McGuinty's dierction, it might be worthwhile for those trying to push the same policy elsewhere to take note of the reality.

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