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Business bashing is a favoured sport of many political parties

Keep Business Tax Relief: Use it to Reduce Corporate Welfare



All of the opposition parties in Ottawa appear to be setting up for another election. This time they are using the government’s commitment to competitive business taxes as their excuse. They are attacking the Harper government’s business tax relief, demanding that business taxes be hiked. Instead they should be attacking wasteful corporate welfare using the tax relief as the perfect excuse to do so.

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An effective political strategy always has been to direct anger towards an external enemy. That is why business bashing is a favoured sport of many political parties, and especially when the economy has been suffering. That is what we are seeing today in the sudden attacks on more competitive business taxes. For example, Liberal leader, Michael Ignatieff, recently questioned, “when will government stop giving help to corporations that do not need help in the first place.” Great question, but he was referring to competitive business taxes for all businesses and not corporate welfare, sadly. A few things are peculiar about this. The Harper government has been increasing handouts for business since they came to power. They have increased the number of so-called regional development agencies, having added one in southern Ontario and one in northern Canada. They have also poured more cash into the budgets of all of these agencies. Opposition parties have said nothing critical about this. The Harper government has increased handouts to corporations through new and increased spending programs for mining, forestry and aerospace, for example; not to mention the $12 billion bailout of GM and Chrysler. Opposition parties have said nothing against these direct handouts to corporations. The Harper government has been moving forward on making business taxes in Canada competitive with other OECD nations. The latest reduction took effect January 1st, when the business tax rate was lowered to 16.5 per cent. The final reduction is scheduled for next January, to 15 per cent. In a strange about-face opposition parties now decry these tax relief measures they allowed to be passed into law. Mr. Ignatieff, Mr. Layton and Mr. Duceppe are now, instead, demanding that business income taxes be hiked back to 18 per cent.


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Kevin Gaudet -- Bio and Archives

Kevin Gaudet, is former the Federal Director, Canadian Taxpayers Federation


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