2011 Canadian Election Thread

[CaptainCrunch]

Originally Posted by Bertuzzied

Except for Kim Campbell. ouch!

Oh Kim Campbell, if you could define the Peter Principle with a person she was it.

Never before has someone so stupid, gone so far, and fallen so fast.

"Hey guys, I'm the first female prime minister, whats with the drop cloth"

"No worries Kim we're just renovating the office"

[troutman]

Kim was actually on Bill Maher's show a few months ago.

[Slava]

Originally Posted by CaptainCrunch

I don't know, I'm hardly rich and not poor, I'm probably in the upper percentage of wage earnings if you look at stats and I pay a ludicris amount of taxes. I would be fine with closing some tax loopholes.

I don't know what the taxation rates are for lower incomes anymore, and its a tough balancing act.

I don't think its a smart move attacking the major employers in this country, especially the ones that have options to invest in other areas of the world.

I would think we would want to encourage investment by these organizations.

I also don't think that your going to miraculously transform the poor to middle class by knocking a couple of percentage points off of their tax, your going to transform the poor with education, social aid when needed and better job selection.

That all sounds good, except when you consider that even at 18% for corporate taxes (where the Liberals would peg it, and the higher figure) we're at just over half of the rate in the US. They don't seem to suffer from businesses that are unwilling to invest.

Also as I've noted before the corporations that do business here are benefiting from these programs. They use the infrastructure, skilled workers and other provisions from the government funded programs. In other words having a corporate tax rate that is a couple points higher, but investing that to improve health, education, infrastructure,etc is not a pure detriment to the large corporation. It could very well be mutually beneficial.

[Ark2]

Originally Posted by TylerSVT

One thing that gets me about Harper is his idea that tax breaks to the rich and corporations leads to higher jobs and benefits to citizens... i'm sort of on the fence on that one. While i agree that in theory it should work, i imagine the trickle down affect is much less than reported.

I would be more inclined to tax the rich and the corporations and decrease the growing divide of middle and upper class in Canada. But it's hard to argue with the CPC's ability to provide a strong economy in the world right now.

The idea is to retain corporations and attract new ones while encouraging them to further their investment. Taxing them will only encourage them to conduct more of their business out of country, which will result in job loss. You listen to Layton and all he talks about is taxing the rich to spare poor families a couple of hundred dollars a year. Well, that's great, but why would these corporations be inclined to continue operating in Canada, especially when other countries are lower their corporate tax rates? So, begin to move their operations elsewhere and guess what, that poor family that got a couple hundred bucks back from the government is now unemployed.

[burn_this_city]

Originally Posted by Slava

That all sounds good, except when you consider that even at 18% for corporate taxes (where the Liberals would peg it, and the higher figure) we're at just over half of the rate in the US. They don't seem to suffer from businesses that are unwilling to invest.

Also as I've noted before the corporations that do business here are benefiting from these programs. They use the infrastructure, skilled workers and other provisions from the government funded programs. In other words having a corporate tax rate that is a couple points higher, but investing that to improve health, education, infrastructure,etc is not a pure detriment to the large corporation. It could very well be mutually beneficial.

The tax rate may be higher in the US, but there are so many loopholes that companies like Exxon paid 0 taxes last year. A year before they managed 15+ billion in profits while getting a 100+ million dollar refund from the IRS.

[Slava]

Originally Posted by burn_this_city

The tax rate may be higher in the US, but there are so many loopholes that companies like Exxon paid 0 taxes last year. A year before they managed 15+ billion in profits while getting a 100+ million dollar refund from the IRS.

Thats a good point.

Actually one of the things that I dislike about the Liberal platform is proliferation of tax credits. It would be better to just say here's the tax rate for everyone and leave it alone. Instead all of these tax credits are almost worthless ($85/year when you do the math sort of things) that are hard to remove in the future and accomplish almost nothing aside from getting the support of the group that gets to use the credit.

You can't remove them down the road because you'll have the other parties saying "what are you against ABC group for?" That being said they are plainly inefficient; allowing someone to claim $500 and giving them 17% of that figure is just adding to the ever increasing amount of stuff you need to file your taxes. They could have the same impact if they were to increase the basic exemption (although it would be for everyone, not only that special segment) or just cut the tax rate by that miniscule 0.0025% (or whatever it actually works out to.

Anyway....that and a few other issues goes along way to explaining why I'm still undecided here.

[crazy_eoj]

Originally Posted by Slava

That all sounds good, except when you consider that even at 18% for corporate taxes (where the Liberals would peg it, and the higher figure) we're at just over half of the rate in the US. They don't seem to suffer from businesses that are unwilling to invest.

Also as I've noted before the corporations that do business here are benefiting from these programs. They use the infrastructure, skilled workers and other provisions from the government funded programs. In other words having a corporate tax rate that is a couple points higher, but investing that to improve health, education, infrastructure,etc is not a pure detriment to the large corporation. It could very well be mutually beneficial.

The US blended rate, even with the huge increases made by Obama, is still competitive with Canada because of our high provincial and municipal corporate taxation.

Cutting corporate taxes will have very little impact upon revenues and increasing corporate taxes will lead to huge job losses. Jobs need to be a central focus during this economic recovery.

http://fullcomment.nationalpost.com/...corporate-tax/

[Slava]

Originally Posted by crazy_eoj

The US blended rate, even with the huge increases made by Obama, is still competitive with Canada because of our high provincial and municipal corporate taxation.

Cutting corporate taxes will have very little impact upon revenues and increasing corporate taxes will lead to huge job losses. Jobs need to be a central focus during this economic recovery.

http://fullcomment.nationalpost.com/...corporate-tax/

I'm fine with the rates being competitive with others around the world actually; its not a place where we should look at a race to the bottom.

Jobs are almost always lagging coming out of a recession. In fact in almost every recession/recovery the recession ends and job losses don't level out for sometime after. Then it takes time for the job creation and re-hiring from the businesses.

The impacts of the corporate tax cut are murky in all of this. The Liberals throw around the number of $6 Billion....because thats the number that the CPC throws around to justify the said cuts. I don't think that its accurate for either case though....its likely half that figure or even smaller. So the programs that the Liberals want to cover here are going to be smaller than projected, and so is the impact that the CPC claims as a result of this tax cut.

[LChoy]

Originally Posted by Slava

I'm fine with the rates being competitive with others around the world actually; its not a place where we should look at a race to the bottom.

Jobs are almost always lagging coming out of a recession. In fact in almost every recession/recovery the recession ends and job losses don't level out for sometime after. Then it takes time for the job creation and re-hiring from the businesses.

The impacts of the corporate tax cut are murky in all of this. The Liberals throw around the number of $6 Billion....because thats the number that the CPC throws around to justify the said cuts. I don't think that its accurate for either case though....its likely half that figure or even smaller. So the programs that the Liberals want to cover here are going to be smaller than projected, and so is the impact that the CPC claims as a result of this tax cut.

My 2 cents. I understand the theory of the trickle down effect, but in my opinion, it wouldn't make too much of a difference if we cut corporate tax rates. Looking at the OECD Tax database
http://www.oecd.org/document/60/0,33...rporateCaptial

Canada already has one of the lowest corporate tax rates as it is (only 3 other smaller countries including Switzerland are lower). In the G8, Canada has the lowest rates. Therefore, cutting a few more percentages really won't make that much of a difference for a company to do business in Canada. In my opinion, economic growth is also highly dependent on other criterias such as opportunities to connect with the US or China through Canada, the value of our currency, and our trade rules.

[TylerSVT]

Originally Posted by Ark2

The idea is to retain corporations and attract new ones while encouraging them to further their investment. Taxing them will only encourage them to conduct more of their business out of country, which will result in job loss. You listen to Layton and all he talks about is taxing the rich to spare poor families a couple of hundred dollars a year. Well, that's great, but why would these corporations be inclined to continue operating in Canada, especially when other countries are lower their corporate tax rates? So, begin to move their operations elsewhere and guess what, that poor family that got a couple hundred bucks back from the government is now unemployed.

I get that, but were talking about scarce resources. Its not like they are making production uneconomical, they are just limiting the amount of surplus value that the company will see. And with the Scarce markets the companies know full well that they need the resources that they are feeding off of(like oil or mining).

I think the idea is flawed because the trickle down doesnt work, i get you want to increase investment but as long as you keep your taxation competitive i dont see why raising it is so bad.

[Ark2]

Originally Posted by TylerSVT

I get that, but were talking about scarce resources. Its not like they are making production uneconomical, they are just limiting the amount of surplus value that the company will see. And with the Scarce markets the companies know full well that they need the resources that they are feeding off of(like oil or mining).

I think the idea is flawed because the trickle down doesnt work, i get you want to increase investment but as long as you keep your taxation competitive i dont see why raising it is so bad.

Is that so? You are basing this on, what exactly? You might as well say that nothing works then. At the very least, having the lowest corporate tax rates amongst developed nations could coax other foreign companies into Canada. Global economists are advising that G20 nations to lower corporate tax rates now and Canada's solution should be to raise those taxes? Okay...

Ultimately, I think we are hearing just a lot of hot air from the Liberals on this point as, if there were to get in power, I sincerely doubt they would raise taxes at all. Layton on the other hand, well, with him I have no doubt that he would raise corporate taxes considerably. Thankfully, we will never have to worry about that happening.

[Jedi Ninja]

Originally Posted by Lchoy

My 2 cents. I understand the theory of the trickle down effect, but in my opinion, it wouldn't make too much of a difference if we cut corporate tax rates. Looking at the OECD Tax database
http://www.oecd.org/document/60/0,33...rporateCaptial

Canada already has one of the lowest corporate tax rates as it is (only 3 other smaller countries including Switzerland are lower). In the G8, Canada has the lowest rates. Therefore, cutting a few more percentages really won't make that much of a difference for a company to do business in Canada. In my opinion, economic growth is also highly dependent on other criterias such as opportunities to connect with the US or China through Canada, the value of our currency, and our trade rules.

Huh? I looked at your link, and only Japan, the US, France and Belgium have significantly higher total corporate tax rates. Canada is in the top 1/3 of this list with a bunch of other countries with rates of about 30%.)

Here is the breakdown of the Combined corporate income tax rates:

Japan 39.54
United States 39.21
France 34.43
Belgium 33.99
Germany 30.18
Australia 30.00
Mexico 30.00
New Zealand 30.00
Spain 30.00
Canada 29.52
Luxembourg 28.59
Norway 28.00
United Kingdom 28.00
Italyf 27.50
Portugal 26.50
Sweden 26.30
Finland 26.00
Netherlands 25.50
Austria 25.00
Denmark 25.00
Korea 24.20
Greece 24.00
Switzerland 21.17
Turkey 20.00
Czech Republic 19.00
Hungarye 19.00
Polandh 19.00
Slovak Republic 19.00
Iceland 18.00
Chilel 17.00
Ireland 12.50

[Jedi Ninja]

Clearly our personal tax rates are too low though. Hurray for raising personal taxes!

[LChoy]

Originally Posted by Jedi Ninja

Huh? I looked at your link, and only Japan, the US, France and Belgium have significantly higher total corporate tax rates. Canada is in the top 1/3 of this list with a bunch of other countries with rates of about 30%.)

Here is the breakdown of the Combined corporate income tax rates:

Japan 39.54
United States 39.21
France 34.43
Belgium 33.99
Germany 30.18
Australia 30.00
Mexico 30.00
New Zealand 30.00
Spain 30.00
Canada 29.52
Luxembourg 28.59
Norway 28.00
United Kingdom 28.00
Italyf 27.50
Portugal 26.50
Sweden 26.30
Finland 26.00
Netherlands 25.50
Austria 25.00
Denmark 25.00
Korea 24.20
Greece 24.00
Switzerland 21.17
Turkey 20.00
Czech Republic 19.00
Hungarye 19.00
Polandh 19.00
Slovak Republic 19.00
Iceland 18.00
Chilel 17.00
Ireland 12.50

Oops, was looking at the wrong column

[Cowboy89]

Originally Posted by TylerSVT

I get that, but were talking about scarce resources. Its not like they are making production uneconomical, they are just limiting the amount of surplus value that the company will see. And with the Scarce markets the companies know full well that they need the resources that they are feeding off of(like oil or mining).

I think the idea is flawed because the trickle down doesnt work, i get you want to increase investment but as long as you keep your taxation competitive i dont see why raising it is so bad.

I would like to challange that arguement. For example a typical oil and gas company would have a wide range of properties and wells that all have different rates of return, ranging from wildly economic to marginally economic to uneconomic. It's not like everything in their portfolio is wildly profitable and taking a bit more off the top doesn't have an impact on the amount of business they do and falls under 'surplus value.'

Higher corporate taxes would push some anticipated new wells currently in the 'marginally economic' bucket into the 'uneconomic' bucket and these wells won't be drilled. On the face of the entire portfolio of assets taking some marginally economic stuff away wouldn't look like a major impact for that specific company, slightly less production etc. etc.

But what about the drill crews who would have been hired to drill these wells? The impact is huge, because it takes away all of the revenue they would have taken in on these wells and thus ripple down from there. This has a trickcle down effect indeed.

[Ark2]

It's one thing to question the level of effectiveness of the trickle down effect. That has merit can can generate some very good discussion. However, simply saying that the trickle down effect does not work is nothing more than liberal rhetoric.

[crazy_eoj]

Originally Posted by Ark2

It's one thing to question the level of effectiveness of the trickle down effect. That has merit can can generate some very good discussion. However, simply saying that the trickle down effect does not work is nothing more than liberal rhetoric.

I've always wondered what people think corporations do with a tax cut when they allege that 'corporate tax cuts don't work'.

Almost all major corporations in Canada are publically owned, and as such shareholders will not put up with simply stockpiling cash because it's an insane waste of money. Extra cash is either distributed to shareholders (IE: pension funds, retirement funds, everyday investors) or reinvested into equipment, new projects, or more staff.

Which corporations simply hold onto extra revenue?

[Slava]

Originally Posted by crazy_eoj

I've always wondered what people think corporations do with a tax cut when they allege that 'corporate tax cuts don't work'.

Almost all major corporations in Canada are publically owned, and as such shareholders will not put up with simply stockpiling cash because it's an insane waste of money. Extra cash is either distributed to shareholders (IE: pension funds, retirement funds, everyday investors) or reinvested into equipment, new projects, or more staff.

Which corporations simply hold onto extra revenue?

You forgot to mention increasing dividends, which is good for the shareholders, and retained earnings which with a lower tax rate makes more and more sense for the small business owner. Why would I want to take money out of my corp and pay 39% when I can leave it in there and pay 25-28%?

EDIT: I read that wrong and clearly that is your first point!

[MarchHare]

Which corporations simply hold onto extra revenue?

I'm not sure if this is still the case, but back in 2004 Microsoft had cash reserves of $60 billion. As of their Jan/10 shareholder report, Apple had nearly $40 billion in cash and short-term investments.

[Ark2]

Originally Posted by Bertuzzied

Except for Kim Campbell. ouch!

Ouch? I was 5 years old when she was Prime Minister. What do I care?