Tax *reform*, a la joint tax return

[Pat Coghlan]

I've been watching various tax cuts implemented over the past 20 years. As a CPC supporter, I'd have to say Paul Martin's re-jigging of tax brackets and indexing them to inflation had more impact than most other "fiddling" with tax cuts.

Now, it's time to move to US-style joint tax returns, instead of just more fiddling. Pensioners have it, and it's time ALL families with the same income pay the same taxes, where all else is the same (number of spouses and children).

If they don't do THAT, or, if they want to continue ignoring family status and try to treat everyone like an individual, then allow each spouse to claim 50% of available benefits based solely on his/her income...which may be zero.

[Progressive Tory]

That's interesting. Is that anything like Stockwell Day's "flat tax" in Alberta, or are you only thinking in terms of tax deductions and credits?

I'm all for a fairer tax system, especially for families.

[Hydraboss]

The only fair tax system is a flat tax with a base exemption.

All the rest is "fiddling" and political funding of pet projects (extra tax for this, tax exception for them,.....)

[Progressive Tory]

The only fair tax system is a flat tax with a base exemption.

All the rest is "fiddling" and political funding of pet projects (extra tax for this, tax exception for them,.....)

You're probably right to a certain extent. But what about extra tax credits for the disabled or the most vulnerable in our society?

[ToadBrother]

You're probably right to a certain extent. But what about extra tax credits for the disabled or the most vulnerable in our society?

And for students... and for northern residents... and for...

Well, waddya know, we have our old tax system back!

[Smallc]

Well, waddya know, we have our old tax system back!

Yes. Everyone always thinks they have a better idea....for themselves...there's a reason the thing is so complicated.

[Progressive Tory]

Yes. Everyone always thinks they have a better idea....for themselves...there's a reason the thing is so complicated.

We'll call it flat tax with bumps. The theory is sound. Did it work in Alberta under Stockwell Day? Does anybody know?

[Molly]

Gadz! I spent so many years fighting with government to avoid being thrown into the same financial pot as my husband....

Call me someone who doesn't even want to do the math, because every time government could find a way to consider 'couple' instead of 'individual' they found a way to screw us (especially the individual 'me') over.

27 times burned, shy on the 28th.

........................

[Alta4ever]

We'll call it flat tax with bumps. The theory is sound. Did it work in Alberta under Stockwell Day? Does anybody know?

Our flat tax works very well. Their is a basic exemption and few tax credits, on the whole we pay way less because of it and it is far superior to anything else currently in use in this country.

That is unless we went to a consumption based tax system (only), the more you buy the more you pay.

[punked]

Our flat tax works very well. Their is a basic exemption and few tax credits, on the whole we pay way less because of it and it is far superior to anything else currently in use in this country.

That is unless we went to a consumption based tax system (only), the more you buy the more you pay.

You can't as a whole "pay way less". As a whole pay the exact same amount so who is paying it? The tax burden has to be shifted and most studies say it is shifted to the poor.

[bush_cheney2004]

You can't as a whole "pay way less". As a whole pay the exact same amount so who is paying it? The tax burden has to be shifted and most studies say it is shifted to the poor.

Nothing wrong with that.....several studies in Canada demonstrate that "the poor" use more services while paying far less. I guess that's why they are called "the poor".

Edited January 26, 2009 by bush_cheney2004

[Alta4ever]

You can't as a whole "pay way less". As a whole pay the exact same amount so who is paying it? The tax burden has to be shifted and most studies say it is shifted to the poor.

Really prove it, ten percent is ten percent. 10% of 10,000 is a $1000, 10% of 20,000 is 2000 so who is unfairly being taxed and where is the burden being shifted? The more you make the more you pay. The huge shift as it were is to the big corporations 10% of huge annual earnings works out ot a big number, not to mentiuon the royalty payments. So please again enlighten us with your "superior" tax system.

Edited January 26, 2009 by Alta4ever

[Progressive Tory]

Our flat tax works very well. Their is a basic exemption and few tax credits, on the whole we pay way less because of it and it is far superior to anything else currently in use in this country.

I have heard from other people that Alberta does have a very good tax system. However, federally you're the same, or is there a system to offset federal taxes?.

[Alta4ever]

I have heard from other people that Alberta does have a very good tax system. However, federally you're the same, or is there a system to offset federal taxes?.

No our federal tax works the same as yours, it would be nice to see a real reform in it. But before any real tax reform can be accomplished, current spending on programs needs to be addressed. If you are going to further reduce taxes spending also has to be curtialed. There is a lot of useless pandering done and a lot of fake outrage and furvor whipped up by the media when anyone tries to do this. The crap needs to be cut and a real tax change needs to be made, and if that means some bean counters lose their jobs because the tax system is simplfied then so be it.

[Renegade]

I'm all for a fairer tax system, especially for families.

What does "fairer" mean and why would families be more entitled to a a "fairer" system than anyone else?

[Renegade]

The only fair tax system is a flat tax with a base exemption.

A flat tax does not address the issue Pat has raised unless you eliminate the base exemption.

[Alta4ever]

What does "fairer" mean and why would families be more entitled to a a "fairer" system than anyone else?

Fairer is one of those words........Depends on what side of the table your on.

[punked]

Here is an IMF paper saying a flat tax in Russia caused economic shrinking while at the same time wage increases helped with economic growth

http://www.imf.org/external/pubs/ft/wp/2005/wp0516.pdf

Here is an IMF paper which shows that the rich pay much less under a flat tax the poor pay less and a huge amount of tax burden is shifted to the middle income.

http://www.imf.org/external/pubs/ft/wp/2006/wp06218.pdf

I also read a study for a flat tax to work it would have to be around 40% you think the GST is bad.

[Pat Coghlan]

What does "fairer" mean and why would families be more entitled to a a "fairer" system than anyone else?

Well, look at Molly's post above. Both spouses are thrown into the same income "pot" for benefits, but taxed as individuals. Her income could be zero, yet their family could receive zero benefits if her husband's income is high.

The government should come clean and either treat EVERYONE as an individual, or treat all families in similar circumstances the same.

What we have is a system that treats everyone as an individual for tax purposes, but refuses to let each INDIVIDUAL claim 50% of available benefits. You have to first be lumped into an income "pot" with your spouse.

Can you think of a reason why two familes with the same total income should receive identical benefits, yet have a $5,000 difference in tax liability?

Before you answer, keep in mind that ALL pensioners couples have the same tax liability. Not so for families with young children.

[Alta4ever]

Here is an IMF paper saying a flat tax in Russia caused economic shrinking while at the same time wage increases helped with economic growth

http://www.imf.org/external/pubs/ft/wp/2005/wp0516.pdf

Here is an IMF paper which shows that the rich pay much less under a flat tax the poor pay less and a huge amount of tax burden is shifted to the middle income.

http://www.imf.org/external/pubs/ft/wp/2006/wp06218.pdf

I also read a study for a flat tax to work it would have to be around 40% you think the GST is bad.

It would work at a much lower amount if we got rid of the all the tax credits and trimmed the fat out of the budget in other words all the incusions into provincial pammters would stop. what your reports show is that that type of tax system does not work for the entitlements you seem to think you deserve to receive.

BTW this isn't Russia.

[punked]

It would work at a much lower amount if we got rid of the all the tax credits and trimmed the fat out of the budget in other words all the incusions into provincial pammters would stop. what your reports show is that that type of tax system does not work for the entitlements you seem to think you deserve to receive.

BTW this isn't Russia.

I agree we would have to get rid of a lot of government programs to have a flat tax to name some

Roads

Firehouses

Schools

Health Care

EI

CPP

but maybe we can keep our military right?

I agree we aren't Russia but becuase Russia is the only example where this has been done and studied I thought it might a good paper for those who care about the issue to read.

Edited January 26, 2009 by punked

[Alta4ever]

I agree we would have to get rid of a lot of government programs to have a flat tax to name some

Roads

Firehouses

Schools

Health Care

EI

CPP

but maybe we can keep our military right?

I agree we aren't Russia but becuase Russia is the only example where this has been done and studied I thought it might a good paper for those who care about the issue to read.

Who said get rid of them, we will just have the proper jurisdiction looking after them again.

Funny that Alberta hasn't been studied but than again you wouldn't like the results.

[Renegade]

Well, look at Molly's post above. Both spouses are thrown into the same income "pot" for benefits, but taxed as individuals. Her income could be zero, yet their family could receive zero benefits if her husband's income is high.

The government should come clean and either treat EVERYONE as an individual, or treat all families in similar circumstances the same.

Well I suppose it depends upon what you mean by "in similar circumstances". In your very restrictive definition a group of two individuals living together with the same aggerate incomes are considered "in similar circumstances". In the view of the government they are not "in similar circumstances" if there is not the same distribution of income between individuals.

Would you consider a "family" of a single parent making $100,000 the same a family of two parents making $100,000? By proposing joint tax returns instead of taxing "family" income is because you have a very narrow view of what is considered a family.

What we have is a system that treats everyone as an individual for tax purposes, but refuses to let each INDIVIDUAL claim 50% of available benefits. You have to first be lumped into an income "pot" with your spouse.

Pat, we've had this debate before. I agree with you that the state should be consistent on what the unit of income measurement is, whether individual or family, for both tax and benefit purposes.

Can you think of a reason why two familes with the same total income should receive identical benefits, yet have a $5,000 difference in tax liability?

There are probably many reasons. It may be that in a family where the income is distributed between two individuals they have higher costs to generate income (eg work clothing, transportation, education, etc)

If you agree that households with the same income should receive the same benefits and pay the same taxes, are you going to extend that to families which consist of a single individual? If not, why not?

Before you answer, keep in mind that ALL pensioners couples have the same tax liability. Not so for families with young children.

Personally I think that such changes introduced for pensioners was not in the name of "fairness" but rather political pandering. So perhaps the right move is to stop income-splitting for seniors unless uniform rules were introduced for the entire taxpaying base.

[punked]

Who said get rid of them, we will just have the proper jurisdiction looking after them again.

Funny that Alberta hasn't been studied but than again you wouldn't like the results.

Well Alberta isn't a country.

Also if you don't want at least 40% tax on everything you buy you will need to get rid of them.

Edited January 26, 2009 by punked

[Alta4ever]

Well Alberta isn't a country.

So...pronvincial tax policies directly effect the provincial economy and public services offered.