GST Ads

[geoffrey]

Increasing the GST rebate, making more items exempt from GST, or an income tax cut would have been much better.

The GST is likely the only tax that effects you as a student. For my first two years of school (when I wasn't working full-time), I earned around $30k and was tax free. Your going to be income tax free unless your making enough money to be spending some serious GST.

This is the first year that I'll be paying full income tax (2008) and I've not been low income for at least the last two.

Eliminating the GST from textbooks would be a nice touch, mind you.

I honestly think that a GST cut benefits that middle class 40-60k range earner more than anyone else.

I save 20% of my earnings, it's not GST taxed. 5% is my car, with GST. 25% is my mortgage which is GST eligible. The other 20% after income taxes and stuff is discretionary spending which is certainly taxed by GST. So ya, 45% of my total income is GST affected and 30% is income tax. That tiny 25% that is not affected... oh well.

I like the GST cut. Using the above calculation, the 2% reduction saves me about $700 a year.

[gc1765]

The GST is likely the only tax that effects you as a student. For my first two years of school (when I wasn't working full-time), I earned around $30k and was tax free. Your going to be income tax free unless your making enough money to be spending some serious GST.

I pay income tax. Not a whole lot, but I do pay it. After tuition I make around $16k a year, which is enough to pay income tax on (the exemption is, what, like $9k?), but doesn't leave a lot of room for GST-taxable items. Keep in mind that rent here in Vancouver is almost a thousand bucks a month, or about $10k a year. Throw in food, savings, etc. and there's not much left. I think I estimated that for every 1% reduction in GST I save around 5 or 10 bucks.

I honestly think that a GST cut benefits that middle class 40-60k range earner more than anyone else.

Compared with? If you're comparing it to a reduction in the higher tax brackets, then yes, I agree. It doesn't do much for those making minimum wage $15-$20k per year though. If you're comparing it with, say, a raise in the basic personal exemption, then I disagree.

...oh, and I agree it would be nice to get rid of the GST on textbooks, even though it wouldn't help me since I haven't bought a textbook in years (and when I did, I tried to get them used).

Edited January 6, 2008 by gc1765

[msj]

I honestly think that a GST cut benefits that middle class 40-60k range earner more than anyone else.

I save 20% of my earnings, it's not GST taxed. 5% is my car, with GST. 25% is my mortgage which is GST eligible. The other 20% after income taxes and stuff is discretionary spending which is certainly taxed by GST. So ya, 45% of my total income is GST affected and 30% is income tax. That tiny 25% that is not affected... oh well.

I like the GST cut. Using the above calculation, the 2% reduction saves me about $700 a year.

1) The GST cut benefits people who make more than 40-60k. Someone who makes $200,000 no doubt saves more but he/she will also spend more on discretionary items (i.e. GST taxable items).

2) I don't quite understand what you mean by 25% of your mortgage being GST eligible.

I will guess that you bought a new home and therefore paid GST on it which would be built into your mortgage (so you paid GST on the purchase of the new house, maybe you got the new housing rebate which reduced the GST by a few thousand and the net difference is part of your mortgage)?

Of course, you could have bought used residential and not paid any GST in the first place.

[geoffrey]

1) The GST cut benefits people who make more than 40-60k. Someone who makes $200,000 no doubt saves more but he/she will also spend more on discretionary items (i.e. GST taxable items).

I'd be about the same with cutting from income tax or GST and I'm in the 60-80k range.

I will guess that you bought a new home and therefore paid GST on it which would be built into your mortgage (so you paid GST on the purchase of the new house, maybe you got the new housing rebate which reduced the GST by a few thousand and the net difference is part of your mortgage)?

Yup.

Of course, you could have bought used residential and not paid any GST in the first place.

I could have. But that's not practical. Someone has to be buying new houses.

[msj]

I'd be about the same with cutting from income tax or GST and I'm in the 60-80k range.

Yup.

I could have. But that's not practical. Someone has to be buying new houses.

We really don't know whether an income tax cut would be better or worse for you since the Cons did not present it as an option.

Of course, you are, hopefully for you, more likely to earn more income longer than you are to be paying down your mortgage (or spending it on GST taxable items) so in the long run you likely would be better off with a reasonable income tax cut (although, to be fair, the Cons budgets have been so poor I have a hard time imagining them coming up with a reasonable income tax cut).

[Shakeyhands]

Good, bad or indifferent... we shouldn't be paying for ad's that are basically election material rah rah'ing the current gov't under the guise of being informational.

[Michael Bluth]

Good, bad or indifferent... we shouldn't be paying for ad's that are basically election material rah rah'ing the current gov't under the guise of being informational.

That's the question shakey. Who decides if an ad is just 'rah rah'ing'?

If the ad campaign helps a million people it is definitely worth it. If it helps twenty people not so much. Where is the line?

[gc1765]

If the ad campaign helps a million people it is definitely worth it. If it helps twenty people not so much. Where is the line?

Good question. Let's do the math. Even if some people have been living under a rock, they are going to figure out that the GST has been cut when they make their first purchase - or at most, by their second or third. As Argus pointed out, we wouldn't want customers to be paying an extra 1% on this first purchase because they didn't know about the GST cut (assuming that there are actually some businesses who would try to pocket the difference - which is unlikely). So what is an average purchase? I don't know, let's say $10... 1% of $10 is 10 cents. If the ad cost $650,000, then it would have to help 6.5 million people to be worthwhile (6,500,000 x 10 cents = $650,000).

I have a hard time believing that this ad helped 6.5 million people, don't you?

[Michael Bluth]

Let's do the math.

Those aren't the only savings. What about the savings to the Government from not having to process incorrect paperwork?

What about the savings to small businesses for booking appointments with their accounts or the guys who fix cash registers early? So they aren't charged higher rates for emergency calls?

The people on this board are not representative of Canadians. By definition we have a much higher interest than the average Canadian in politics, government announcements and policy.

The "living under a rock" line is dismissive and belittles those Canadians who don't share our interest in and passion for politics.

I'm not saying average Canadians weren't necessarily aware the GST was supposed to go down to 5%, but they may not have known the date...

[gc1765]

Those aren't the only savings. What about the savings to the Government from not having to process incorrect paperwork?

What about the savings to small businesses for booking appointments with their accounts or the guys who fix cash registers early? So they aren't charged higher rates for emergency calls?

As msj pointed out, businesses should have received notices in the mail. I think that's a much better idea. Even if some of those businesses were missed for some reason, as msj pointed out customers would soon make them aware. Certainly they would have figured it out before any paperwork was done.

The people on this board are not representative of Canadians. By definition we have a much higher interest than the average Canadian in politics, government announcements and policy.

I would think that the average business owner would also have a much higher interest in politics & government announcements, especially considering that we have known for years that the government was planning on reducing the GST.

[noahbody]

Government tends to waste millions on things they don't need to advertise. They also advertise where they don't need to for political reasons (i.e. advertise in both city papers though demographically one might be all that is necessary).

In this case, sending out the gst forms to registrants a month earlier would have given all that needed to know, notice.

I remember the government had a campaign out after 911 telling everyone not to pack liquids etc in their carry-on. Even if someone didn't own a tv and radio and never read a newspaper, they would have received this message at the airport. Still they felt the need to advertise.

[Michael Bluth]

Government tends to waste millions on things they don't need to advertise. They also advertise where they don't need to for political reasons (i.e. advertise in both city papers though demographically one might be all that is necessary).

In this case, sending out the gst forms to registrants a month earlier would have given all that needed to know, notice.

I remember the government had a campaign out after 911 telling everyone not to pack liquids etc in their carry-on. Even if someone didn't own a tv and radio and never read a newspaper, they would have received this message at the airport. Still they felt the need to advertise.

Great point. This thread rightfully points out wasteful Government advertising in general.

However, it was started as wasteful Government advertising for purely political purposes.

Which is interesting, because posters who are arguing this is government money to support a party's polices have made the argument elsewhere on this board that the GST is a bad tax cut.

If the majority of Canadians really believe the GST is a bad tax cut shouldn't the opposition be welcoming these ads as an example of the Government highlighting its mistake?

btw, has anyone seen one of these ads?

Edited January 6, 2008 by Michael Bluth

[gc1765]

Which is interesting, because posters who are arguing this is government money to support a party's polices have made the argument elsewhere on this board that the GST is a bad tax cut.

If the majority of Canadians really believe the GST is a bad tax cut shouldn't the opposition be welcoming these ads as an example of the Government highlighting its mistake?

The average Canadian isn't going to turn down a tax cut. But if they had a choice between a GST cut or an income tax cut, I'd bet the majority would choose the income tax cut.

I saw a Conservative ad the other day pointing out that Dion was considering raising the GST. What the ad conveniently left out is that Dion was considering raising the GST in order to pay for income tax cuts. Hmm, wonder why they would leave that part out of the ad?

[jdobbin]

I saw a Conservative ad the other day pointing out that Dion was considering raising the GST. What the ad conveniently left out is that Dion was considering raising the GST in order to pay for income tax cuts. Hmm, wonder why they would leave that part out of the ad?

Probably the same reason they downplayed how they were going to reverse an income tax cut to pay for their first GST cut.

[noahbody]

Probably the same reason they downplayed how they were going to reverse an income tax cut to pay for their first GST cut.

The difference is the Conservatives made the gst reduction part of their platform before Martin dropped income tax rate, not after.

[sharkman]

This speculation about what Dion would do is fun for liberals, but not dealing in reality since Dion will never be more than a dumpy opposition leader.

You can belittle the GST cut all you want, but a 2 cent cut is a 28% decrease. I can't understand how some abhor this.

[Michael Bluth]

I saw a Conservative ad the other day pointing out that Dion was considering raising the GST. What the ad conveniently left out is that Dion was considering raising the GST in order to pay for income tax cuts. Hmm, wonder why they would leave that part out of the ad?

Like the Liberals left the potential deployment of additional troops near major urban centres for dealing with emergencies out of the 'guns in our streets' ads?

As long as it is paid for by the party there is no complaint.

The Conservatives correctly pointed out that Dion has made billions in spending promises. Dion is considering raising the GST to pay for these promises. Hmm, wonder why you left that part out of your post?

You can belittle the GST cut all you want, but a 2 cent cut is a 28% decrease. I can't understand how some abhor this.

Some abhor this because they truly believe the 'Natural Governing Party' tripe and the GST is another example of why the Liberals won't regain their God-given right for years to come.

Some people hate the fact that Harper has proven to be much more reasonable and the fear-mongering has been proven false.

Some people are just conspiracy theorists. They have convinced themselves *scary* *scary* *scary* is correct and they are saving the country by opposing Harper with every fiber of their being.

Some people are just angry and full of hate.

I wish I lived in a competitive riding where the Conservatives ran these ads. Oh well, just have to watch them online...

Edited January 6, 2008 by Michael Bluth

[capricorn]

The average Canadian isn't going to turn down a tax cut. But if they had a choice between a GST cut or an income tax cut, I'd bet the majority would choose the income tax cut.

If the Liberals stand for a "fairer" Canada, why would they not support the GST cut? Income tax cuts are great IF you earn income. So the GST cut is positive for Canadians who do not benefit from income tax cuts.

I saw a Conservative ad the other day pointing out that Dion was considering raising the GST. What the ad conveniently left out is that Dion was considering raising the GST in order to pay for income tax cuts. Hmm, wonder why they would leave that part out of the ad?

Or the Conservative ad could have said that the Liberals want to raise the GST to pay for the new Liberal social programs.

[gc1765]

If the Liberals stand for a "fairer" Canada, why would they not support the GST cut? Income tax cuts are great IF you earn income. So the GST cut is positive for Canadians who do not benefit from income tax cuts.

Read my previous posts:

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Or the Conservative ad could have said that the Liberals want to raise the GST to pay for the new Liberal social programs.

The Conservatives have increased spending by billions, especially in Quebec. So I guess it's accurate to say that the Conservatives increased income taxes in order to pay for their wild spending.

[jdobbin]

The difference is the Conservatives made the gst reduction part of their platform before Martin dropped income tax rate, not after.

What difference does that make? The Tories said they were going to reverse income tax cuts and did it.

[capricorn]

Read my previous posts:

I would not object if the GST rebate was increased while maintaining the present GST cut. It's true a lower GST benefits high income earners. Yet, most low income earners I know don't lose sleep if some people can afford a $50,000. car and they can't. Our taxation policies should not be formulated on the basis of envy of those with more money.

The Conservatives have increased spending by billions, especially in Quebec.

Governments that bring in large surpluses usually increase spending. Of importance is that spending decisions are well-founded. Personally, I wish the Conservative would spend less, cut more federal programs and reduce taxes.

So I guess it's accurate to say that the Conservatives increased income taxes in order to pay for their wild spending.

I'll just say that I respect your partisan opinions.

[Michael Bluth]

I'll just say that I respect your partisan opinions.

You rightfully pointed out that the Liberals want to raise the GST for social programs.

And you didn't have to degrade yourself by using "wild spending".

Such language is inflammatory and unnecessary.

I thank you for bringing a degree of decorum to the board.

[gc1765]

I would not object if the GST rebate was increased while maintaining the present GST cut.

For the same price, between reducing the GST OR increasing the GST rebate & cutting income taxes, which do you think would help the poor more??

It's true a lower GST benefits high income earners. Yet, most low income earners I know don't lose sleep if some people can afford a $50,000. car and they can't. Our taxation policies should not be formulated on the basis of envy of those with more money.

No, but they might lose sleep if that GST cut which benefits the person buying a new car is the reason why income taxes were not cut (or actually increased) or the GST rebate was not increased. Especially if they are struggling to pay rent & buy groceries.

Of importance is that spending decisions are well-founded.

To you, yes. Others might think the Liberal spending decisions are well-founded.

[capricorn]

And you didn't have to degrade yourself by using "wild spending".

The archaic expression "spending like drunken sailors" used by anti-Conservatives makes me chuckle. It's an overused cliche that detracts from their arguments.

I thank you for bringing a degree of decorum to the board.

Thank you. Mind you, I have slipped on occasion but quickly regained my composure.

[Michael Bluth]

No, but they might lose sleep if that GST cut which benefits the person buying a new car is the reason why income taxes were not cut (or actually increased) or the GST rebate was not increased. Especially if they are struggling to pay rent & buy groceries.

That's the group that benefits from the transit pass credit, which you dismissed.

I guess they only really lose sleep if they listen to partisan propaganda as opposed to looking at everything the Harper Government has done for them.