Quote:
Originally Posted by #-3
The GST is just a tax on people who don't have the means to save.
If you are putting 20% of your income into savings every month, then you are only paying 4% GST, while those who live pay to pay pay 5% GST, and often those who manage to save the 20% are able to recoup the 4% they did spend on GST in capital gains before they actually spend down their savings, It's a terrible tax if you fundamentally believe in progressive taxes.
Also in modern service economies the biggest drag on productivity is often demand. If someone is willing to buy it, someone will supply it.
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Disagree. At low income levels the total amount of GST paid is ~0 on a net basis.
Someone making $20k gets 2.5% of their gross income as GST rebate, so even if we assume they pay no other taxes the maximum GST they're paying is 2.5%.
And at that income level I have to think 50% of income gets spent on things without GST. For example rent and groceries, making effective GST rate 0.
While it's true that those with high income don't pay GST on money they save, high income earners have a lot more tax planning opportunities to reduce income taxes. Capital gains inclusion, dividend tax credit, RRSP deductions, donations, business expenses, etc. GST is very difficult to avoid.