The first in a seven-part series, “Taxes for the Common Good.”
In a rare convergence of cross-party fiscal and social priorities, all parties in the House of Commons have come together to end the tax on tampons (and other feminine hygiene products), effective July 1. This decision has sparked some interesting discussion about gender equality, luxury versus essential items, and – in light of the anticipated loss of $33 million in annual tax revenue – the role of taxation in Canada. But with a federal election looming large on the horizon, all of our party leaders are – more-or-less – on the same page, with each one of them scrambling to demonstrate who will deliver the best collection of tax cuts to voters.
What really gets cut when we reduce taxes?
Any discussion of taxation has been completely severed from the services, and corresponding quality of life, that our tax dollars provide. This is profoundly problematic.
Taxes build our roads and bridges, pay for our police and firefighters, offer support for raising children, provide income security for the elderly, and help to ensure our environment is clean and safe. They pay for the programs, services, and infrastructure that make up our common wealth as a society. They support the democratic institutions of government, as well as funding the transfers, programs, and services governments provide.
It is critical that we remember that taxes are not simply about money or fees collected by governments. They are equally about public programs and services, reducing poverty and the harmful effects of inequality, and protecting the environment. Paying taxes is therefore a contribution to the common good; paying taxes helps to build a better Canada.
A public justice primer on taxation
In an effort to encourage public dialogue about the value of taxation, Citizens for Public Justice (CPJ) has developed “Taxes for the Common Good: A Public Justice Primer on Taxation.” Released May 27, this series of fact sheets highlights the positive role taxes play in a democratic society and summarizes the latest data on the costs and opportunities afforded by various federal tax policy options. CPJ analysis covers six areas:
• The High Cost of Low Taxes
• Public Services: Good Value for Money
• How Progressive is Canada’s Tax System?
• Lower Corporate Taxes: Who Benefits?
• The Rise of Tax Expenditures
• Putting a Price on Carbon
CPJ believes it’s time for serious public dialogue about taxation that takes into consideration the vital ways that public revenues help us build a healthy, more vibrant Canada.
This means we need to question the prevailing perspective that taxation is a burden.
Taxes: burden or opportunity?
Over the past 30 years, governments have increasingly promoted tax cuts as the answer to any number of social and economic challenges. As a result, many public programs have been gutted, and now even the most basic services are said to be unsustainable. Not surprising, since lower taxes mean less money in the public purse.
CPJ contends that a public justice approach views taxation as a tool for promoting the common good. We support a progressive distribution of taxes as well as transparent and accountable decisions from governments on taxation and spending. We believe our tax system should function as a way to decrease the inevitable inequalities of the free market economy.
Research shows that more equal societies enjoy improved economic performance, as well as improved social well-being. Canadians are well-aware of the need for social investments for poverty reduction, environmental protection, education, health care and social security in our communities.
We also recognize our responsibility as citizens to participate in public life in a way that enables justice, including the promotion of social structures and associations that contribute to the common good. One of the primary ways in which we can do this is through the contribution of our income and wealth through taxes.
Recognizing the good that taxes can do – helping to create a democratic, just, and equitable society – is not to suggest that we be naive about the potential for misuse. Taxes should not be used to for the personal gain of the political elite or merely benefit the wealthy. Taxes should not burden the poor. The use of our common resources must be transparent. Decision-makers must be accountable to Canadians for their policies. Active citizenship includes ensuring that government is working for the common good.
A better way forward
The removal of the federal tax on feminine hygiene projects is a good thing; it is an example of a positive change to Canada’s tax system that promotes gender equality and assists women living in poverty. Unfortunately, however, it comes at a time when federal tax revenues are at the lowest rate in 70 years and those on the margins of society are suffering due to lost public services.
So as we look to October’s election, let’s ask our candidates about the real cost of tax cuts and who pays the price. And let’s ask them how they’ll invest in building a better Canada.
Karri Munn-Venn is a policy analyst at Citizens for Public Justice, a national organization of members inspired by faith to act for justice in Canadian public policy. Taxes for the Common Good: A Public Justice Primer on Taxation is available free at www.cpj.ca/taxes-and-common-good.