Yes, mind boggling.
Although we support all of these measures with the exception of the capital gains elimination, it represents a whole bunch of tinkering with little gain for Canadian taxpayers and the government. It has spent a year doing nothing but politics as usual, as did the Conservatives. Canadians voted for change. They thought the Liberals would change the way we conduct business and they have changed very little.
We need a new set of principles to set a new direction for federal taxation. The need for reform in matters of taxation is widely recognized. The federal government under Brian Mulroney raised taxes 33 times and implemented the GST plan in the face of widespread opposition.
The Liberal government is now considering revisions that will inevitably prove to be even more unsatisfactory, a combination of the son of GST, called the NATVAT, or a surtax on income or both. Consumption taxes on top of income taxes are not the answer.
Five fundamental principles should be applied to the Canadian system of taxation: first, all taxation programs of whatever kind should be for the exclusive purpose of raising revenue to fund authorized government spending and should not be for the purpose directly or indirectly to shape economic or social activity.
Second, all taxation programs should be consistent with the governmental role of creating a framework. It can be square or round, whichever-we do not have to mess around, whether we square it or round it, or round it or square it-just do what is right so it widens people's choice and wherever possible leaves power and responsibility in the hands of the people.
Third, tax legislation should be simple and easily understood by taxpayers, permitting most taxpayers to file their own returns.
Fourth, taxation should be visible, that is, no hidden taxes.
Fifth, rates of taxation should be limited and not punitive for both individuals and corporations. The incentive should be to reward production and leave more dollars in the hands of taxpayers and wage earners than the government. The only purpose of taxation should be to raise funds.
However, we have become accustomed to a multiplicity of objectives in our taxation system. It tries to encourage domestic production, investment in certain industries, charitable donations and further education. It tries to discourage smoking, drinking, imports and pollution. Unfortunately it also ends up discouraging taxpayers.
There will always be convincing arguments for making the taxation system more responsive to some other government initiative. Examples are taxes on petroleum products to protect the environment; taxes on alcohol or smoking to reinforce moral standards and healthier living.
Once we give in to one of these arguments we leave ourselves open to making judgments based upon personalities, effectiveness of lobby pressure, political expediency and other human frailties.
I believe the only purpose of taxation should be to raise funds needed to pay for government programs approved by the Canadian voters. I believe a proportional tax is the answer to creating a simpler, more efficient and more effective system of taxation.
The idea of a proportional tax is an attempt to improve upon the flat tax models that have circulated for many years to improve upon the single tax as proposed many years ago by the member for Broadview-Greenwood who is presently working on the single tax and trying to refine it, improve it and make it understandable to the government. Now that he is on the government side it would be hoped that members of the government would pay more attention to the proposal because it has a lot of advantages. There are a lot more advantages than disadvantages.
Of course it has that one big weakness that governments do not like and that government bureaucracies do not like. It is too simple and because it is too simple it will not work. It has to be complicated, convoluted and confusing before governments will support it.