Be afraid people, be very afraid. We need to increase taxes on businesses immediately or 70 years from now we will be in great peril! I just finished watching an interview with Kevin Page on the Soloman Show, and once again he is advocating raising taxes. This time the impetus for raising taxes is our aging population demographic, and it is correct that at some point in the future we are going to have a large increase in the number of people living on pensions with a shrinking work force (offset by immigration).
I don't disagree that this is something that we have to focus on in the medium term. Neither Evan of Kevin mentioned the Canada Pension Plan adding 128 billion dollars in equity value over the last 3 quarters. Neither discussed ways to trim the budgets of government ministries. No the focus was on raising taxes for businesses. Page said that for each 1% we lower business tax, we lose 1 billion dollars in annual tax revenue, and that the Tories have dropped the business rate from 20% to 15%.
The contradiction comes where he admits that cutting tax rates to businesses attracts more business to our country and that jobs are added to the economy as a direct result of government taking less money from business. He admits that cutting taxes adds jobs at the same time that he is demanding that we raise taxes. Obviously adding to the tax burden on business is going to have a negative effect on employment, but we must do it anyway in the interest of long term stability? How come it always seems to be bureaucrats demanding higher taxes instead of spending cuts, elected or otherwise?
Eventually we are going to have to start putting more money away to the CPP, but as it exists right now we are in much better shape than a lot of western countries with similar population demographics. The United States is in a lot bigger trouble than we are. Again Kevin Page is making long term GDP forecasts which is a virtually unpredictable statistics given how much of our GDP depends on global resource prices which fluctuate independently of our structured system.