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Kind of brave

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So some months ago, a blue-chip corporate advisory panel recommend the following tax policies to the Ontario government:

  • Reducing corporate taxes
  • Imposing a carbon tax
  • Harmonizing the PST and GST

At the time, all were dismissed by Dwight Duncan, Liberal Finance Minister. And I thought of posting on it at the time, that it was sort of unfortunate they were ignoring that advice.

Now that the situation has changed, I guess I owe some kudos. Especially as I see all the commentary and poll numbers about the sales tax harmonization as a “tax grab”. This isn’t going to be popular.

Now it isn’t, from what I can tell, actually a tax increase for the government overall, as it’s being combined with lower corporate and personal taxes.

But the government is not going to get any credit for that. People will notice paying the PST on things they didn’t have to before, and they won’t notice that their pay cheque (if they still get one) is now a little bigger (unless it isn’t for other reasons).

So, it was kind of a brave move.

Don’t want to overstate that—they do have the comfort of fairly weak opposition parties at the moment, and they were able to defuse criticism by keeping the PST off hot-button items like books, tampons, and diapers. And of course, all those cheques most will be getting that first year.

Still. Going from 0 to 2 out 3 ain’t bad. (Got that song in your head now?)

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