Trudeau’s ‘God-awful’ tax tactics

Entrepreneurs point out that neither Finance Minister Bill Morneau nor Prime Minister Justin Trudeau know what it takes to nurture a startup, Gwyn Morgan writes. 33 per cent, taking the combined federal/provincial rate to over 50 per cent in almost all provinces. And while Morneau and Trudeau wage class warfare against the “wealthy,” in reality a private-sector person with gross earnings of around $150,000 per year without a pension is less well-off than many lower paid publicsector workers in secure jobs with shorter hours and generous pension benefits. Moreover, these high-earning, skilled professionals are exactly the workers needed for a successful economy. Yet as Canada faces a growing shortage of such highly mobile workers, our government notches up their tax burdens at the same time the U.S. is lowering them.

But it’s not just higherincome earnings that are taking a tax hit. A newly released Fraser Institute study found that, despite the Liberal’s election campaign rhetoric of reducing taxes on the middle class, taxes for over 80 per cent of middle-income families have actually increased.

Trudeau’s determination to maximize the amount of taxes extracted from working Canadians is no doubt driven by the fact that that his promised “modest deficit” is spiralling out of control. But history has clearly demonstrated that when tax rates become excessive, tax revenues go down, not up. And so does economic growth because high taxes discourage startup entrepreneurs and the risk-taking investors needed to finance them, while over-taxed skilled workers take their badly needed expertise to countries where they get to keep more of their earnings.

With this angry, dark tax cloud hanging over our “sunny ways” prime minister, where should his government go from here? The best answer to that question comes from Easter: “It would have been better to launch a broader review of the tax system, with extensive debate of options for reform.” And while the prime minister is at it, he should appoint Easter his new finance minister.