Comment 88050

By Mogadon Megalodon (anonymous) | Posted April 20, 2013 at 13:25:15

See also


and, eerily,

As far as "$1.3 billion worth of corporate tax cuts that the Liberals plan on giving away starting in 2015. That's $1.3 billion a year that will no longer be available for priorities such as transit," there is a modicum of truth there. But it should also be noted that the NDP has linked this savings with all manner of potential gains (health care, home care, education, social assistance) across the board. They have not indicated what proportion of the $1.3 billion they would dedicate to transit, or even if any proportion of it would be dedicated to transit. It is obviously not a panacea for transit, and it is hardly a panacea for general revenues. Consider that full-day kindergarten was said to cost $1.5 billion a year. But attendant costs have proved harder to quantify.

Furthermore, corporate tax seems like a volatile and unreliable revenue stream. It's not as if corporations don't have creative accounting departments stacked with tax code wonks, it's not as if corporations don't go bankrupt or move to more lucrative jurisdictions (viz Ontario 1990-1995) and it's not as if they don't go bankrupt or face market downturns. As reliable and sustainable revenue streams go, this seems less than ideal.

On top of all that, unlike a surtax on those whose income is $500K+, it's not as if all incorporated businesses that maintain a permanent establishment in Ontario -- big and small -- aren't liable for Ontario corporate taxes. It's possible that, on balance, the anticipated $1.3 billion doesn't quite materialize as expected.

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