Thursday, July 27, 2017

Thursday Morning Links

This and that for your Thursday reading.

- Dennis Howlett writes that a properly designed and fair tax system can reduce inequality both by ensuring support for the people with the least, and ensuring that the people capable of contributing the most actually do so:
We need to tackle inequality at both ends of the income scale. Everyone, even the rich, benefits from a more equal society with better population health, reduced crime, better educational and employment opportunities, and a more vigorous economy.

Recent progressive income tax reforms can only do so much. That’s because our tax system continues to be riddled by unfair and ineffective tax loopholes that allow the wealthy to avoid paying anything close to the top marginal rate on much of their income.

And we don’t have any real tax on wealth (as opposed to income). The Alternative Federal Budget 2017 (link is external), which CPJ and Canadians for Tax Fairnes (C4TF) have contributed to, proposed that the federal government tax wealth by introducing a minimum inheritance tax of 45 per cent on estates valued above $5 million. This would net an estimated $2 billion annually in new revenues.

C4TF has identified over $16 billion in unfair and ineffective tax loopholes that should be closed. The most egregious ones include the Stock Options Deduction, the Capital Gains Deduction, and the Business Entertainment Tax Deduction.

On the other end of the income scale, Canada’s tax system is also able to transfer benefits to low-income Canadians in a very efficient way. It has reduced poverty among seniors and families with children. But we still have high levels of poverty in Canada and we need to do much more.
More than 12 per cent of working- age Canadians live in relative poverty. Provincial minimum wages and social assistance rates fall far below the poverty line. While child and senior poverty has been the focus of government anti-poverty initiatives in recent years, very little attention has been given to addressing working age poverty. The federal government has some tools available that could tackle this problem. A very cost effective and efficient way to deliver benefits to many low-income Canadians would be to boost the GST/HST credit. This benefit now costs about $4 billion. C4TF recommends doubling this amount for an additional expenditure of $4 billion a year. All of these enhancements to current programs would cost about $6 billion a year. They could easily be funded by closing some of the $16 billion of unfair and ineffective tax loopholes.
- Stephen Roach writes that people are increasingly skeptical of globalization in a form which restricts any benefit to a privileged few. And Daniel Boffey reports on the disproportionate role the UK and the Netherlands play in providing conduits to offshore tax evasion.

- Meanwhile, Max Lawson points out that states including Namibia, Malawi and Mongolia are putting the rest of the world to shame in their policy choices to rein in inequality. 

- Christine Saulnier and Tammy Findlay examine how to develop a universal child care system in Nova Scotia. And Raisa Deber discusses what we should fund through a universal medicare system - including plenty of services not yet included in Canada's system, but not unnecessary procedures which are all too often covered by the public dime.

- Finally, Aurangzeb Qureshi asks how we can give CSIS a blank cheque with the rights of all Canadians when it can't even avoid gross discrimination against its own employees.

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