Tax­a­tion should max­i­mize hu­man well-be­ing

Times Colonist - - Comment - TREVOR HAN­COCK [email protected] Dr. Trevor Han­cock is a pro­fes­sor and se­nior scholar at the Univer­sity of Vic­to­ria’s school of public health and so­cial pol­icy.

‘Taxes are the price we pay for a civ­i­lized so­ci­ety,” said U.S. Supreme Court Jus­tice Oliver Wen­dell Holmes 100 years ago. But from a health and hu­man-de­vel­op­ment per­spec­tive, the ques­tion is, what sorts of taxes are best for im­prov­ing health and which worsen health?

What would be a sen­si­ble tax regime if our pur­pose were to max­i­mize hu­man well-be­ing? A good place to start is with some ba­sic needs. Tax­a­tion that en­sured a sup­ply of clean wa­ter, san­i­tary treat­ment of hu­man wastes and uni­ver­sal ed­u­ca­tion for chil­dren was in­stru­men­tal in dra­mat­i­cally im­prov­ing the health of the pop­u­la­tion in the in­dus­tri­al­ized world in the 19th cen­tury.

Be­yond these ba­sic needs, tax­a­tion that keeps our food and homes safe through food in­spec­tion and build­ing codes is key, as are taxes that safe­guard our air qual­ity and cre­ate safe streets and highways. Polic­ing, fire­fight­ing and other emer­gency ser­vices would be high on any­one’s list of use­ful taxes, as are parks, recre­ation, li­braries and other cul­tural ac­tiv­i­ties. And, of course, we are gen­er­ally very sup­port­ive of our tax­payer-funded health-care sys­tem, which en­sures peo­ple have ac­cess to needed care.

It is in­ter­est­ing to note that many of these ser­vices, with the ex­cep­tion of health care, are de­liv­ered lo­cally by mu­nic­i­pal gov­ern­ments. Yet mu­nic­i­pal­i­ties lack the tax­ing power they need and are largely de­pen­dent upon prop­erty taxes, which are un­just.

Small won­der the pres­i­dent of the Fed­er­a­tion of Cana­dian Mu­nic­i­pal­i­ties wrote in 2012 that: “Our cur­rent sys­tem, in which mu­nic­i­pal­i­ties col­lect just eight cents of ev­ery tax dol­lar, is not sus­tain­able.” That it places “a grow­ing bur­den on prop­erty taxpayers, strain­ing lo­cal ser­vices and forc­ing mu­nic­i­pal­i­ties to de­lay es­sen­tial in­fra­struc­ture projects.”

The fed­eral gov­ern­ment is not re­spon­si­ble for mu­nic­i­pal­i­ties, but the next fed­eral gov­ern­ment needs to show some lead­er­ship, in con­junc­tion with the prov­inces, to en­sure that mu­nic­i­pal­i­ties have the re­sources they need to pro­vide the many ser­vices that are so es­sen­tial to our health and well-be­ing.

A ba­sic prin­ci­ple of tax­a­tion should be that you tax the things you don’t want — such as to­bacco — and don’t tax what you do want, such as healthy food. In the midst of an epi­demic of obe­sity, then, it would be a good idea to tax sugar, which would have a sig­nif­i­cant im­pact on our con­sump­tion of soft drinks, pop, sug­ary ce­re­als and other junk food.

Sim­i­larly, given that Canada has un­usu­ally high lev­els of salt in its pro­cessed foods, and given the fail­ure of the fed­eral gov­ern­ment’s kid­gloves treat­ment of the food in­dus­try in re­quir­ing only a vol­un­tary ap­proach to re­duce lev­els, a tax on added salt would be a good idea.

The re­verse of tax­a­tion, of course, is sub­si­diza­tion. Here, the prin­ci­ple is that you don’t sub­si­dize the things you don’t want, and in­stead sup­port what you do want. One of the more ob­vi­ous cases where sub­si­diza­tion needs to be re­versed is in energy pol­icy.

At a time when we need to re­duce fos­sil-fuel use — and in the case of Canada, keep 80 per cent of our fos­sil fu­els in the ground — we should not be pro­vid­ing any sub­si­dies or tax breaks to the fos­sil-fuel in­dus­try. In­stead, we should be redi­rect­ing those tax breaks and sub­si­dies to what we do need — energy con­ser­va­tion and clean, re­new­able energy.

Fi­nally, and per­haps most pro­foundly, we need to use our tax­a­tion sys­tem to cre­ate a greater de­gree of so­cial eq­uity, which will have a wide va­ri­ety of so­cial ben­e­fits, in­clud­ing a re­duced bur­den of dis­ease. In par­tic­u­lar, the health im­pacts of child poverty must be elim­i­nated by elim­i­nat­ing child poverty, a tar­get unan­i­mously adopted by the House of Com­mons in 2000 and dis­re­garded by the fed­eral gov­ern­ment since then.

Of course, since chil­dren live in fam­i­lies, this re­ally means elim­i­nat­ing fam­ily poverty. There are many ways to do this, but pro­vin­cial anti-poverty strate­gies (only B.C. lacks one) tend to fo­cus on in­creas­ing min­i­mum wages, re­duc­ing hous­ing costs, in­creas­ing so­cial-as­sis­tance rates and en­sur­ing the af­ford­abil­ity of ba­sic needs such as food.

The guid­ing prin­ci­ples for health­fo­cused tax­a­tion, then, would in­volve tax­ing all that is un­healthy in so­ci­ety, giv­ing tax breaks to what is healthy and us­ing taxes to meet the ob­jec­tive of “from each ac­cord­ing to their abil­ity, to each ac­cord­ing to their need.”


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