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Some tax tweaks would solve B.C.'s economic problems
"Taxes are what we pay for a civilized society" (U.S. Supreme Court Justice Oliver Wendell Holmes).
B.C. is broke!
There is no money for classroom essentials for public school students, mental health services, and road and bridge improvements. After a decade of tax cuts in B.C., annually the B.C. government gives up $3.5 billion in tax revenues.
The B.C. government gets more money from the medical services premiums (MSP, due to go up four cent on Jan. 1) than it does from corporate income tax.
Basic shifts in B.C.’s revenues have gone from corporations to individual households, from upper-income households to middle-class households, from progressive income tax to consumption taxes like MSP premiums, user fees.
Those reading this know how much more they have to pay in extra fees for their kids at school, when they renew their driver’s licence, or go to a private health company for services available at St. Joe’s.
It’s just not right! But what to do?
Option 1: Add two new income brackets: $150,000 and tax at 18 per cent, plus a $200,000 bracket and tax at 21 per cent. This would bring in $700 million, enough to restore class sizes, composition and specialist teachers to the level they were at just five years ago and to provide 2,000 social housing units, ending our homeless situation in the valley.
And this would affect only the top one or two per cent of tax filers.
Option 2: Two new tax brackets as above and increases to the existing top three brackets of two per cent of income (only the top 14 per cent of tax filers affected) and raise $1.1 billion that could do the above and provide needed investment in community health care, first phase of a child-care plan and increase funding for post-secondary education for our children and grandchildren.
There are other options, like closing loopholes, increasing corporate taxes — each one per cent increase brings in $200 million. But you get the flavour of the solutions out there for the B.C. government.
B.C. needs to return to a more progressive tax system.