Alberta PST discussion

[Azure]

If the corporate tax rate isn't raised, I think Alberta should at least create some incentives to get the corporate side to start investing more money into the economy. Especially now with the looming recession.

[Rerun]

Originally Posted by Antithesis

Wow, I'd love to live in a world where I found it appropriate to use the term 'only' in front of $850 million.

Well since $850 million is only 2% of 2014 revenues of $44 billion, I would consider only to be applicable.

Anyways, debating my use of the word "only" is beside the point. The point is the report that the Parkland Institute released on Thursday. Debate that.

[Mean Mr. Mustard]

Originally Posted by Rerun

Well since the deficit for 2015 is forecast at $6.2 Billion and adopting a progressive flat tax regime for personal income tax would bring in up to $13.6 billion in additional revenue for the province, I really don't see the point in raising the corporate tax rate from 10% to 12%, particularly since we are competing against other provinces, such as Ontario, who also have a 10% rate.

Business's may not flee but I don't think its unreasonable to suggest that attracting new business might become more difficult.

Except Ontario has an 11.5% corporate tax rate. I somehow think that it would be possible to bring in a progressive personal income tax and increase the corporate tax rate by even 1% and bring in an extra 400 million dollars to provincial budgets so we can do things like invest in the economy.

[Azure]

At this point any extra money from taxes will go to just making sure you have enough to fund the budget.

Perhaps Alberta should be doing some deficit spending while interest rates are low to build the economy in hopes that when oil picks up again it will balance itself out to pay off the debt.

[Fozzie_DeBear]

I am frankly annoyed at the Alberta ethos...howling like a Tea Partyer at suggested changes to taxes...and skitterish at the energy sectors volatility.

Yet, when it comes to fighting for and supporting meaningful changes to economic diversification Albertan's are apathetic and disengaged.

Not a recipe for success...Alberta's economy is living on borrowed time under its current structure and its going to take epic leadership at the top and grassroots culture change to move it in the needed direction.

[Rerun]

Originally Posted by Mean Mr. Mustard

Except Ontario has an 11.5% corporate tax rate. I somehow think that it would be possible to bring in a progressive personal income tax and increase the corporate tax rate by even 1% and bring in an extra 400 million dollars to provincial budgets so we can do things like invest in the economy.

Yes and no. Ontario has a General corporate tax rate of 11.5% and a 10% tax rate for Manufacturing and Processing and tax holidays are available to certain corporations.

As to the rest of your statement you are probably right. I just have problems with a 20% increase in the tax rate when you go from 10% to 12%.

[Resolute 14]

"Well crap. People haven't been ground into submission yet. Better shelve this until after the election when I will be safe from backlash for a few years.

[Frequitude]

Here comes a progressive income tax.

Can't complain.

[CaptainCrunch]

I don't get his a flat tax is harder on the poor, that argument makes no sense when Alberta I think has one of the highest exemption dollar figures in the country.

I think anyone making under $18,500 pays no provincial tax.

I can't think of any more of a fair and progressive tax then a flat tax with a reasonable exemption.

Its easy to calculate for the provincial government as well which means its cheaper to implement.

[Red]

Originally Posted by CaptainCrunch

I don't get his a flat tax is harder on the poor, that argument makes no sense when Alberta I think has one of the highest exemption dollar figures in the country.

I think anyone making under $18,500 pays no provincial tax.

I can't think of any more of a fair and progressive tax then a flat tax with a reasonable exemption.

Its easy to calculate for the provincial government as well which means its cheaper to implement.

Every province has an exemption similar to Alberta's.

But our lower income people pay 10% on anything over it where in other places they pay much less. See few below and check the whole list here
NL 7.7% on the first $35,008 of taxable income
ON 5.05% on the first $40,922 of taxable income
BC 5.06% on the first $37,869 of taxable income
NWT 5.9% on the first $40,484 of taxable income
NV 4% on the first $42,622 of taxable income,

And on the other end of the spectrum you see high income earners here pay few % less than anywhere else. It truly is a system for the rich,

[CaptainCrunch]

Originally Posted by Red

Every province has an exemption similar to Alberta's.

But our lower income people pay 10% on anything over it where in other places they pay much less. See few below and check the whole list here
NL 7.7% on the first $35,008 of taxable income
ON 5.05% on the first $40,922 of taxable income
BC 5.06% on the first $37,869 of taxable income
NWT 5.9% on the first $40,484 of taxable income
NV 4% on the first $42,622 of taxable income,

And on the other end of the spectrum you see high income earners here pay few % less than anywhere else. It truly is a system for the rich,

BC has an exemption of 9900, so they're still paying 5% for anything over that.

Ontario is about the same.

Alberta has 0 tax on anything at about 18k or below. With the other provinces if they make 18k or below they're still paying a portion of taxes. That to me is more regressive.

If you want to make changes to the Alberta tax system. You could raise the exemption slightly to something like 24k which is fairly realistic and then bump the flat tax above that by a point or two. That would be a fair tax.

[Red]

Originally Posted by CaptainCrunch

BC has an exemption of 9900, so they're still paying 5% for anything over that.

Ontario is about the same.

Alberta has 0 tax on anything at about 18k or below. With the other provinces if they make 18k or below they're still paying a portion of taxes. That to me is more regressive.

If you want to make changes to the Alberta tax system. You could raise the exemption slightly to something like 24k which is fairly realistic and then bump the flat tax above that by a point or two. That would be a fair tax.

Take a 40K earner and compare after tax dollars in each province. Albertan will pay more than most others.

[MarchHare]

Originally Posted by CaptainCrunch

BC has an exemption of 9900, so they're still paying 5% for anything over that.

Ontario is about the same.

Alberta has 0 tax on anything at about 18k or below. With the other provinces if they make 18k or below they're still paying a portion of taxes. That to me is more regressive.

If you want to make changes to the Alberta tax system. You could raise the exemption slightly to something like 24k which is fairly realistic and then bump the flat tax above that by a point or two. That would be a fair tax.

Let's imagine a low-income Canadian who makes $35k/year. Assuming the tax rates and personal exemption amounts provided by you and Red above are both accurate, that person would pay the following amount of provincial tax in Ontario, BC, and Alberta:

Ontario: $1,267.55 (5.05% of $35k - $9.9k)
Alberta: $1,700.00 (10% of $35k - $18k)
BC: $1,270.06 (5.06% of $35k - $9.9k)

So yes, low income Albertans do indeed pay more provincial income tax than low income Canadians in other provinces with progressive tax rates but lower personal exemption amounts.

[CaptainCrunch]

Originally Posted by MarchHare

Let's imagine a low-income Canadian who makes $35k/year. Assuming the tax rates and personal exemption amounts provided by you and Red above are both accurate, that person would pay the following amount of provincial tax in Ontario, BC, and Alberta:

Ontario: $1,267.55 (5.05% of $35k - $9.9k)
Alberta: $1,700.00 (10% of $35k - $18k)
BC: $1,270.06 (5.06% of $35k - $9.9k)

So yes, low income Albertans do indeed pay more provincial income tax than low income Canadians in other provinces with progressive tax rates but lower personal exemption amounts.

fair enough, though I don't really believe that 35k is really low income, I would class that as lower to middle. I believe that the higher exemption rate helps low income earners.

If you adjust to lets say $24,000

Alberta 24k exempt 10% = 600
Ontario 5.05 = 1267
BC 5.06 = 1271
But like I mentioned, if you raised the exemption rate in Alberta to lets say 24k

Then on a 35k line

Alberta would be $1100.00
Ontario 1267 at their current plan
BC 1270.00

You could even increase the flat tax rate by a 1 or 2% to compensate and it would still be a fairer system to the poor at or below the exemption point then the other taxes.

[Red]

Originally Posted by CaptainCrunch

fair enough, though I don't really believe that 35k is really low income, I would class that as lower to middle. I believe that the higher exemption rate helps low income earners.

If you adjust to lets say $24,000

Alberta 24k exempt 10% = 600
Ontario 5.05 = 1267
BC 5.06 = 1271
But like I mentioned, if you raised the exemption rate in Alberta to lets say 24k

Then on a 35k line

Alberta would be $1100.00
Ontario 1267 at their current plan
BC 1270.00

You could even increase the flat tax rate by a 1 or 2% to compensate and it would still be a fairer system to the poor at or below the exemption point then the other taxes.

24K is just over $11/hr. Minimum wage is $10.20

Can't find anything from the gov sites so it's unconfirmed, but the average hourly wage in AB is $27.80 which is about 58K.

[Red]

Found this. Almost 59K in AB

http://www.workopolis.com/content/ad...ges-right-now/

http://www.statcan.gc.ca/daily-quoti...30a001-eng.htm

[Flash Walken]

Originally Posted by Red

24K is just over $11/hr. Minimum wage is $10.20

Can't find anything from the gov sites so it's unconfirmed, but the average hourly wage in AB is $27.80 which is about 58K.

That may be the average hourly wage, but more than a quarter of people employed in Alberta make 16 dollars an hour or less.

[CaptainCrunch]

Originally Posted by Red

24K is just over $11/hr. Minimum wage is $10.20

Can't find anything from the gov sites so it's unconfirmed, but the average hourly wage in AB is $27.80 which is about 58K.

Minimum wage is what I'd probably define as the working poor. That's the group that I'm concerned about.

In terms of a mean of 58k, it would be interesting to know if that number is caused by upward drag.

[GGG]

I would like to see the exemption raised, leave the 10% rate for up to 100k and then raise the above 100k to fund the costs of increasing the exemption.

I think that the amounts over 100k should be taxed higher and maybe a seond higher bracket at 150 or 200.

Reduce the tax burdern for the poor <40k. Keep it the same for the middle class and increase it for the 10%ers.

[Flash Walken]

Originally Posted by GGG

I would like to see the exemption raised, leave the 10% rate for up to 100k and then raise the above 100k to fund the costs of increasing the exemption.

I think that the amounts over 100k should be taxed higher and maybe a seond higher bracket at 150 or 200.

Reduce the tax burdern for the poor <40k. Keep it the same for the middle class and increase it for the 10%ers.

You don't even need to raise it on the 100k population, just raise several percentage points on the 350K+ population.