Damn socialistsApril 27 2005 at 6:55 PM
|BigE (no login)|
from IP address 220.127.116.11
No, we can't give "big business" tax cuts, that's just wrong. We need those tax dollars to guarentee doctors a gazillion dollars a year for making appointments and prescriptions for natives (indians) and junkies on welfare so they can re-sell the drugs... which are being bought with the money we give them like rent cheques out of our tax funds. We need the tax dollars so politicians can go on power trips and collude with their buddies to run a government like a puppett show. We can't let people make money for themselves and look after it themselves, only the government is capable of handling such a complex process. Unless you're in Quebec, maybe?
Well my rant is about the great state of our government in Canada right now. Paul Martin, instead of being noble, is wheeling and dealing his way around in Ottawa to stay in power as long as he can... which isn't going to be much longer. So, Martin made a deal with the little rugrat, Jack Layton, to renig on the proposed corporate tax cut that was in the budget. For now, Martin gets NDP support. What is more annoying is the blatant ignorance of economics involved with these dealings. The thing I hate most about fiscal socialists is that they don't understand that tax rate cuts don't necessarily translate into less tax revenues and/or a wealthier society. Our provincial government manned up and went ahead with a corporate tax relief program in the budget released yesterday... all I heard all day long was how the government was screwing the little guy. Like hell! They're trying to get little guys more jobs to pay their bills! IDIOTS!
Value of tax cuts to economy
$5-billion: C.D. Howe Institute paper
Wednesday, April 27, 2005
OTTAWA - The $4.6-billion in corporate tax cuts that were apparently sacrificed last night in a Liberal-NDP budget deal had the potential to boost Canada's economic growth by $5-billion a year and create up to 340,000 jobs at "little cost" to government, a C.D. Howe Institute report concluded.
Meanwhile, economists issued warnings about the potential Liberal-NDP alliance, saying it could mean the end to balanced budgets. Also, foreign exchange traders say the Canadian dollar has lost some of its value over worries that Paul Martin will withdraw tax cuts aimed at corporate Canada.
The C.D. Howe Institute report was the first to put a value on the proposed $4.6-billion in tax cuts, introduced as part of the Liberal government's 2005-06 budget tabled in March. The study was released yesterday, before NDP leader Jack Layton's announcement that there was an agreement in principle with the Liberals.
"The taxation of businesses reduces their incentive to invest in capital and restricts their ability to expand and innovate, making it harder to hire new workers or existing ones higher salaries," the study's authors, C.D. Howe president Jack Mintz and tax analyst Duanjie Chen, write. Once the tax cuts are implemented, businesses would have more cash at their disposal, the think-tank said.
The institute also said past studies have linked lower operating costs to increased corporate investment -- and, in turn, more jobs.
Also, the proposed tax cuts would favourably position Canadian rates against the United States and ensure the country remains competitive in its ability to attract business.
"The 2005-06 federal budget, in providing further corporate tax cuts, is the right approach to improving Canada's investment climate," the think-tank said.
Mr. Martin had publicly resisted heeding NDP demands to roll back the tax cuts, saying they were needed to spur job creation. He said as much late yesterday afternoon in Windsor, Ont. -- just over an hour before Mr. Layton announced the budget deal.
Details on the deal are sketchy, as the Liberal and NDP negotiators finalize certain elements. However, political sources indicated last night the business community has lost three-quarters, or $3.4-billion, of the $4.6-billion in tax cuts promised. The tax relief salvaged is aimed at the small business sector, the sources added.
Meanwhile, the Liberal government has promised to allocate $4.6-billion over the next two years to affordable housing, environment, post-secondary education and foreign aid. It is not clear where the Liberal government will get the money to pay for these new initiatives.
The C.D. Howe study said the $4.6-billion in tax cuts put Canada "on the right track" toward making its business sector more competitive internationally. This is crucial given the rapid emergence of the new economic powerhouses of China, India and Brazil, which can attract investment due to their cheap, but highly-skilled, labour.
The minority Liberal government agreed to retool its budget because it is crashing in public opinion polls, and anxious to avoid defeat in the House of Commons on a confidence vote and the election that would follow. But a combined Liberal-NDP vote does not necessarily guarantee the government's survival, as the Conservative Party and Bloc Quebecois, together, have more MPs in the House of Commons.
The NDP has said the corporate tax cuts came out of the blue and are not a priority for Canadians. Yet, prior to last year's election campaign Mr. Layton pledged to an association of small- and medium-sized business owners that the NDP was committed to changes to the business tax structure.
"The NDP believes in creating a fair taxation system for small businesses and is open to examining ways of changing the current system," the NDP said in a response to survey distributed by the Canadian Federation of Independent Business.
Others also weighed in on the potential economic impact of the Liberal-NDP talks. Clement Gignac, chief economist of National Bank of Canada, said history suggests politicians' commitments to balanced budgets, as the Liberals have pledged, can change with circumstances, such as the current minority turmoil.
He noted the last time the federal Liberals and NDP teamed up together was in the early 1970s, and that was followed by a 16% ramp up in federal spending and a slowdown in Canada's economy.
Meanwhile, at least one currency expert cited the Liberal-NDP alliance as a factor in pulling down the value of the Canadian dollar. Yesterday, the dollar dropped 0.49 points to close at US80.3 cents.
"I think equity market players who had factored in tax cuts for business in Canada are going to be reassessing and revising downward their expectations should such a deal with the NDP happen.
"None of this is good for the currency," said Andrew Busch, a currency strategist at Harris Nesbitt Corp. in Chicago.