Taxation – Fair and Simple

I was recently challenged (thank you Murray MacDonald!) to define “Fair Taxation”. I invite people to challenge things and this particular topic is very complex. I wish I was bestowed with the answer to this question however I don’t have a full answer. This is due in some way to the complexity of our tax systems which I believe needs to change. I do have some directions I would like to explore. The official BC Conservative Party Policy Document contains the basics of the platform. I encourage you to read it.

So what is Fair Taxation? For starters a fair tax system might include the following concepts:

Comprehendable – I would argue that our tax system has to be simplified so that people, including myself, can sufficiently understand it. I love math but the level of complexity of our finances is hard to understand.

Usefullness – As I research the Carbon Tax, I am finding some very disturbing facts. First, it doesn’t actually seem to reduce carbon. I belive the studies may be flawed but will stand corrected if they are not. I will grant it is difficult to measure GHG’s accurately. I am an environmentalist and I do not want to leave my children a damaged world. Second, the 2012 budget document contains an assumption that GHG emissions will actually climb! Why do we have a tax that does not reduce carbon and is revenue neutral? I would rather reduce GHG’s for real. The image below shows that the taxes will rise by around 10% between 2012 and 2015. Since it is taxed on volume, there is a linear relationship between the amount produced and the tax revenue. Still think the carbon tax is working?

Links:  Carbon Tax revenue – page 68 of the BC 2012 Budget

Transparency – The next BC budget contains some yet undefined items. The Government is planning to raise over $625 million from the “release of surplus assets”. What are those assets? Will this be like the BC Rail debacle again?

Links: Revenue by Source – page 15

Accountability – The following excerpt comes form the BC Conservative Party Policy Document:

ARTICLE 4. Financial Management.

Every tax dollar collected from British Columbians is received in trust. This trust must be managed and accounted for according to the highest standards of integrity and transparency. The people’s scrutiny of all spending decisions should be encouraged and welcomed.

Sounds good to me. At the same time, we are now being presented another budget that is more of the same broken promises and excuses.

I will write more on this topic later. Thank you Murray and others for being vigilant on this front.

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