Friday, May 16, 2008

Because I am a brilliant closet economist and a Canadian

I thought I would wade into the whole carbon tax hoopla and offer Liberal leader Stephane Dion the benefit of my two cents of opinion.

I will not vote for any government which would suggest I pony up and pay another tax just for simply living, but more importantly, neither will most Canadians.


James Bow said...

Well, an income tax is more of a tax that one pays simply by living. You can avoid paying a carbon tax by driving less, and that's a lot more under control for more people.

If the installation of a carbon tax is coupled with a corresponding reduction in income taxes, I'd support it. And, according to some polls, so would 61% of Canadians.

Kateland, aka TZH said...

James, actually, it is just not true that I can avoid the carbon tax by just driving less.

I already do not drive under any circumstances, but I will still be paying for the carbon tax when I take a taxi to run a child to the hospital, or in higher prices when I go to the grocery store to buy food which was been trucked in. Or how do I avoid shelling out a price increase the gas company will no doubt pass along (as an added cost for the expense of doing business) for delivering fuel to heat my house - regardless of how low my thermometer is set? Ditto for all consumer goods etc.

Of course, I am sure the TTC will not miss an opportunity to use the carbon tax to justify another fare increase…I could go on but I really cannot see how I can avoid the so-called 'carbon tax", even if I don't drive, and never did. A funny thing about those alleged 61% of Canadians who think a carbon tax is such a fine thing is that I suspect, if they were polled and asked, if they were prepared to see their standard of living decline by at least 20-25%, it would be entirely a different story.

James Bow said...

Well, you don't necessarily have to drive as far, or heat your house as hot. There are ways to use less energy, or to use your energy more efficiently. Tap into that, and you can save the money on the carbon tax, that would likely have been taxed just for the "privilege" of earning an income.

This is something we're likely going to have to face anyway as Peak Oil becomes more of an issue. Emphasizing the finite nature of this resource makes a lot of sense to me. For this reason, I do not object to the carbon tax, if it is applied in a revenue neutral manner (i.e. something else has to come down).

Kateland, aka TZH said...

But your missing point - I don't drive, I already conserve energy and have been conserving resources decades before it became fashionable to do so. But so what, hit me with another tax on my already overtly taxed butt.

As for peak oil, you can worry about it if you want to...although, I rather invest in Hom Tov instead.

James Bow said...

Well, then, with you being as energy efficient as you are, then theoretically, you stand to benefit from this shift. While your carbon taxes will increase, depending on your income, you stand to pay less government on the taxes.

James Bow said...

One other thing: it's not clear that the TTC or other transit agencies would be affected by the tax. It's a bit of a grey area but it's illegal for one level of government in Canada to tax another. For this reason, there is no GST on GO Transit, as it is a provincial agency, and GO Transit itself doesn't pay the GST.

The TTC is a bit of a grey area, being an arms length municipal agency. For several years, they were obliged to pay GST on their capital purchases, but took the matter to court. The Federal Government eventually settled, I believe, by waiving the GST on their purchases, in exchange for not handing back the money they'd taken during that decade.

James Bow said...

"you stand to pay less government on the taxes."

Wow. I mangled that one up, didn't I?

Of course, I meant to say: "you stand to pay less taxes to the government."

James Bow said...

And, I'm sorry to harp on this point -- if you think I'm overstaying my welcome, I fully understand -- the goal of such a change should be: if you are an average income earner, and an average carbon user, you should see no change in the amount of money you hand to the government in the form of taxes. However, suddenly, you have more control. Rather than the complicated forms and the exemptions and not-exemptions that force me to hand my income taxes to an accountant for $170 each year, I can reduce my taxes by driving less, walking more, allowing the house to stay cooler, et cetera.

You, on the other hand, who have a much smaller carbon footprint than I do, should already be ahead. If you are an average income earner and a more efficient carbon user, you will automatically pay less taxes to the government. That's your reward for conserving this precious resource and making our air cleaner.

And we can certainly talk about alleviating the stress on those who are below average income earners, those who are on fixed incomes, et cetera, to ensure that they're not the ones who take on an unfair burden as a result of this switch.

And that will be my last post on this, unless you have specific questions.

Kateland, aka TZH said...

Don't worry about mangling it up James, been guilty of that on occassion myself...the problem, as I see it, is no matter what I do I will be forced to pay the carbon tax - if only indirectly as retailers pass on the higher costs to the consumer - and they will get passed on. And to what benefit - and do you really see trust the government to make good on their promises? Think about the so-called security tax which was put into effect post 9/11 to improve security at airports. Its been quite the cash cow - not so good in terms of security.

James Bow said...

"and do you really see trust the government to make good on their promises"

That's a separate issue, though. If the government wanted to increase taxes, that should be a different debate. But if the money they collect remains the same, what is the best way to collect that money, do you think? Consumption taxes, poll taxes, or income taxes, or something else entirely?

Kateland, aka TZH said...

I could be considered a tax purist - so I'd like to see income taxes go, and favour consumption taxes - with maybe a small flat income tax rate.

But back to the carbon tax - I do not believe we need any new taxes but rather relocate the income the government already receives. Maybe designate 3% of the GST which is a consumption based tax anyway.

Currently, Toronto is experiencing a large downturn in enrolment, which I suspect is being mirrored across the country which should translate into freeing monies in places where spending was a growth industry for years. And with the pending death of the babyboomers in 20+ years, should remarkably reduce our carbon footprint considerably as a society by at least a third.