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Originally Posted by opendoor
OK, but the difference in consumption taxes relative to overall tax revenue between Canada and somewhere like Norway is basically nothing. 21.9% of Canada's tax revenue is through VATs and consumption taxes vs. 23.0% in Norway; raising GST back up to 6% would basically equalize things.
Yeah, other European countries have higher consumption tax rates leading to more revenue, many into the 27-30% range of total revenue. But it's not like it's the foundation of their tax revenue. If you removed all consumption taxes from places like Denmark, Finland, or Sweden while keeping 100% of Canada's current consumption taxes, the tax-to-GDP ratio in those countries would still be within a few percentage points of Canada's. They have higher consumption taxes primarily because all of their taxes are higher.
And obviously, Canada being next to the US means we have to be cognizant of aligning things to some degree. The US has the lowest consumption taxes in the OECD, so if we strayed from that too far it could be counterproductive.
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You can't really compare the two. Norway for example dumps all of their resource "royalties" into corporate taxes and they also includes property taxes and everything else. And its a tiny country, I think they have three levels of government but its nothing in comparison to a province.
https://taxfoundation.org/location/n...istration%20(5)
Main thing I see is sales tax brings in the same amount of money as income taxes. In Canada, income taxes are 400-500% more. Which ya, 25% is 500% more than 5%. That tracks. I'd have to read how their corporate taxes work but I imagine normalizing that would make the disparity even worse.
Using Alberta as an example, I think a 5% PST is estimated to bring in about 5 billion. So maybe 7% of government spending.