Dion's carbon tax + tax reduction of $15 B

[calculoso]

http://www.ctv.ca/servlet/ArticleNew...tories&s_name=

Stephane Dion's "green shift" carbon tax plan would cut taxes by $15.5 billion, including $11 billion in personal income tax cuts, CTV News has learned.

The income tax reduction is to make up for the $15.5 billion levy on carbon, aimed at reducing greenhouse gases in Canada.

The proposed green tax will hit electricity and home heating fuel but exempt gasoline. The Liberals have acknowledged that oil companies may pass the cost of the tax on to consumers.

May? How about WILL. Interesting that they're exempting gasoline. Does this include diesel too?

Here's how the tax brackets that will be affected by the Liberal's plan:

* one per cent cut in the general tax rate, from 15 per cent to 14 per cent

* 1.5 per cent cut to the rate for the lowest tax bracket from 15 per cent to 13.5 per cent. This affects people earning $37,885 or less.

* one per cent reduction for the second-lowest tax bracket ($38,885 to $75,769), from 22 per cent to 21 per cent.

* one per cent cut in third-lowest income tax bracket ($75,769 to $123,184) from 26 per cent to 25 per cent.

So, what does this mean?
- Making $ 37,885, current tax $ 5682.75, new tax $ 5114.475, save $568.275
- Making $ 50,000, current tax $ 8348.05, new tax $ 7658.625, save $689.425
- Making $ 65,000, current tax $11648.05, new tax $10808.63, save $839.425
- Making $ 75,000, current tax $13848.05, new tax $12908.63, save $939.425
- Making $100,000, current tax $20317.29, new tax $19127.87, save $1189.425

Now, assuming a monthly electric bill and natural gas bill of $130 each (yearly $3120), how much would they have to go up to be "revenue neutral"? Sure you've got companies paying into this 'green tax', but really... it'd have to be a big percentage increase, no?

[Flames in 07]

And WTI goes up by $30 in five minutes.

Economy slows down because the cost of buisness goes up, and the government needs the personal income to make up for the loss in corporate tax.

[MelBridgeman]

So how is this going to help again? Will spawn new research? technology? People are all ready changing habits thanks to current prices...This will further increase the price of everything...

[Shawnski]

The headline on this CTV article has to be the most misleading I have ever seen. "Dion's 'green shift' to reduce taxes by $15 billion"

NO tax reductions will occur. It is supposed to be revenue neutral afterall, so taxes will be paid somewhere. Let alone the cost to administer a program like this. THOSE costs also have to be included somewhere.

[prarieboy]

I'm not sure what this achieves.

Let's assume it is revenue nuetral and your tax refund will offset your increased electricity and heating bill.

All that does is take money out of my pocket for a while and give it back to me later.

If somehow that money ends up sitting in the governments bank for a period of time I guess they'll make some dough.

Will this money be put into so called "Green Programs"?

[prarieboy]

Originally Posted by Shawnski

The headline on this CTV article has to be the most misleading I have ever seen. "Dion's 'green shift' to reduce taxes by $15 billion"

NO tax reductions will occur. It is supposed to be revenue neutral afterall, so taxes will be paid somewhere. Let alone the cost to administer a program like this. THOSE costs also have to be included somewhere.

LOL!! Never thought of that Shawnski, could be another Firearm fiasco in the making.

[alltherage]

I seriously shudder at the thought of a 2nd GST on fuel. They already have what, 70% of the profit from gas prices between the provincial and federal gov'ts? This, as an SUV driver, disgusts me.

[calculoso]

Originally Posted by alltherage

I seriously shudder at the thought of a 2nd GST on fuel. They already have what, 70% of the profit from gas prices between the provincial and federal gov'ts? This, as an SUV driver, disgusts me.

I'll give Dion credit. He has enough smarts to know that if he included gasoline in the carbon tax... err... "green shift" that he'd get smacked up one side and down the other.

[CaptainCrunch]

Won't the refinement processes that create gasoline be carbon taxed, thus gas will be effected.

This is a Dion shell game, where nothing is going to change but our wallets are going to get lighter.

Thank god he will never get a Sniff of the Prime Ministers Office.

[IntenseFan]

Originally Posted by CaptainCrunch

Thank god he will never get a Sniff of the Prime Ministers Office.

One would hope that's true CC. But I have learned over the years that anyone running as a Federal Liberal has the chance to win.

[old-fart]

What about the increase in cost for everything you buy? Sorry, but if you increase the cost to make a widget with a new tax, and the cost to package that widget, the cost to ship that widget, the cost to market and sell that widget (all of these things take energy of some sort, and that energy is now going to be carbon taxed).... the end price of said widget is going to go up. Will those tax cuts take that into account? Of course not. Plus, the GST will be up on the end price as well, even if they don't raise the GST rate (as the Liberals have also suggested they will do). If the end cost of $100 widget goes up to $120, that's an extra $1 in GST the government will collect on every single widget.... Is Dion returning that to us as well?

Didn't think so...

This tax will plunge Canada into a deep recession in all sections of the economy. Dion needs to go back to academia where he can sit around and muse about policy that will never work in the real world.

[Slava]

I can't see anything wrong with this. The costs to administer this are nothing more than what it costs to administer the tax system we have now. This is a fantastic way to tax what we don't want while loosening the reins on what we want more of!

I would figure that conservatives would be all over this...less income tax and more taxes on the companies and organisations that actually profit as a result of their polluting ways!

[old-fart]

Originally Posted by Slava

I can't see anything wrong with this. The costs to administer this are nothing more than what it costs to administer the tax system we have now. This is a fantastic way to tax what we don't want while loosening the reins on what we want more of!

I would figure that conservatives would be all over this...less income tax and more taxes on the companies and organisations that actually profit as a result of their polluting ways!

Conservatives are smart enough, I hope, to not implement a tax system that will plunge the country into a recession.

What about those that don't pay any income tax, but will see their rents rise? Do you think landlords aren't going to pass on the costs to heat the apartment building to the tenants? Are they going to be able to afford groceries, that will all rise in price thanks to increased production costs? If they have a car now, it will be more expensive to drive - even the Liberals admit the costs imposed on the production of gas will likely be passed on to the consumer. If they take transit, that cost is going to increase as well as the city isn't going to absorb the additional costs. You think they will be able to afford to buy a new hybrid vehicle?

This is a great plan... in a classroom. In the real world, it's an economy killer.

I wonder why Dion said in the leadership race that a carbon tax was a bad idea, and now it's his silver bullet scheme?

[MelBridgeman]

Originally Posted by old-fart

What about the increase in cost for everything you buy? Sorry, but if you increase the cost to make a widget with a new tax, and the cost to package that widget, the cost to ship that widget, the cost to market and sell that widget (all of these things take energy of some sort, and that energy is now going to be carbon taxed).... the end price of said widget is going to go up. Will those tax cuts take that into account? Of course not. Plus, the GST will be up on the end price as well, even if they don't raise the GST rate (as the Liberals have also suggested they will do). If the end cost of $100 widget goes up to $120, that's an extra $1 in GST the government will collect on every single widget.... Is Dion returning that to us as well?

Didn't think so...

This tax will plunge Canada into a deep recession in all sections of the economy. Dion needs to go back to academia where he can sit around and muse about policy that will never work in the real world.

Exactly what i have been thinking...I was listening to the radio in Vancouver the other day and the topic du jour was the BC Olympic (nee carbon) tax. One person called in and said "The tax doesn't effect me, it is a consumption tax, and i choose not to drive, so i am for it!" I guess they don't realize that everything you do in some way requires energy, therefor those prices will rise as well...that will create more tax revenue for the goverment.

The appliances i was looking at buying a few months ago are now $200 dollars more each now..mmm...I wonder why!

[MelBridgeman]

n/m

[Slava]

This has to be the only site in the free world where the tax reductions/redistribution of where they are collected matters. Because the red party proposed it and not the blue this is horrible?

How do you figure that the economy goes into recession based on this tax? If the oil industry is as bullet-proof as everyone implies than surely they will have no issue with this.

[old-fart]

Originally Posted by Slava

This has to be the only site in the free world where the tax reductions/redistribution of where they are collected matters. Because the red party proposed it and not the blue this is horrible?

How do you figure that the economy goes into recession based on this tax? If the oil industry is as bullet-proof as everyone implies than surely they will have no issue with this.

You do understand this is not just a tax on oil companies right? I mean... you get that don't you?

The price of virtually everything is going to go up. No, this isn't a tax on tomatoes per say, but the cost to produce those tomatoes, to harvest them, to ship them to market... is going to go up. The cost for Sobey's to keep the lights on is going to go up. Their cost to keep the freezers cold is going to go up. Do you think Sobey's is going to absorb those costs out of some green altruistic nature? I can tell you... they won't. They'll increase the price of the goods they sell to keep their profit margins the same. If they are greedy (good thing there are no greedy people in the world), they might even tack on a little bit to the profit margin because people will be expecting a price increase, so why not add an extra 1 or 2% for the profit bump. Of course, if we weren't talking about tomatoes, the GST would be up too, because the cost would be up.

Now, do you think employers are going to increase everyone's salary to offset these increases so that Joe Employee isn't as affected?

Do you believe that the 1% tax cut is going to offset all these costs?

Less money to spend in disposable income + more expensive everything = recession.

[CaptainCrunch]

To add to the above. Even if this tax goes into play which forces up general costs which are passed on to the consumer. Even if these companies change their ways, reduce their carbon footprints and reduce their costs, there's nothing to force them to reduce their prices, they'll just increase their profits.

Any kind of general taxation like this even if they call it Revenue Neutral will impact someone in a non neutral way and force ripples to the whole economy. And baby it may effect the rich and upper middle class, but it will destroy the poor and lower class.

[Slava]

Don't worry about my understanding here; but thanks for your concern!

I understand fully that increased taxes mean increased prices. But the other side of the coin is that the consumer does have increased disposable income. There are also a large number of businesses and companies that are not going to be taxed more heavily; these just happen to be the companies that are more environmentally friendly and more attractive as both investments and purchases as a result.

[dustygoon]

Originally Posted by CaptainCrunch

To add to the above. Even if this tax goes into play which forces up general costs which are passed on to the consumer. Even if these companies change their ways, reduce their carbon footprints and reduce their costs, there's nothing to force them to reduce their prices, they'll just increase their profits.

Any kind of general taxation like this even if they call it Revenue Neutral will impact someone in a non neutral way and force ripples to the whole economy. And baby it may effect the rich and upper middle class, but it will destroy the poor and lower class.

Strange part is that there is going to be a cost transfer from income taxes to monthly gas bill. Rather than try to dodge income taxes, people will try to reduce monthly gas taxes by reducing what they are burning. This is going to end up being a regressive tax......guess which tax bracket is going to be able to afford to put in new efficient windows, better furnaces, and a solar panel on their roof?

And then what if the overall effect of the carbon tax does reduce usage....that will reduce revenues for the gov't so they will have to go back and increase income taxes again to make up the difference.