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Old 10-04-2019, 08:13 PM   #1
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Default Canadian Election Policy Discussion Thread

Since the other Politics thread gets bogged down in Politics I thought I’d create a thread to discuss the election platforms of each of the parties. The goal of this thread is to discuss how a specific policy, assuming it was implemented as stated by the party in their platform or media would affect Canada and which Party’s platforms are better for Canada

A couple of proposed guidelines
- each post should be discussing a specific policy
- no horse race talk
- no scandal talk
- no meta how does this policy play to the base
- no discussion on how terrible each leader is and how None of the Above is clearly the best candidate

Maclean’s has been maintaining a really good summary issue by issue on their website so an excellent starting point for discussion.

https://www.macleans.ca/politics/201...on-everything/
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Old 10-04-2019, 08:14 PM   #2
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Starting With Taxes

Quote:
Liberal platform
Raise the basic personal amount to $15,000 by 2023, for taxpayers whose annual salary is less than $147,000 (source)
Cut in half the corporate tax paid by companies that develop and manufacture zero-emissions technologies (source)
Put a 10 per cent tax on luxury cars, boats, and personal aircraft over $100 (source)

Conservative platform

Cut the tax rate on income under $47,630 from 15 per cent to 13.75 per cent (source, PBO analysis)
Effectively remove federal portion of income tax from EI maternity and EI parental benefits by providing a non-refundable tax credit of 15 per cent for any income earned under these two programs (source)
Remove the Goods and Services Tax (GST) from home heating and energy bills (source)
Establish a single tax return for Quebec, administered by the province (source)
Bring back the Harper-era public transit tax credit of up to 15 per cent on monthly and weekly transit passes or electronic fare cards (source, PBO analysis)
Relaunch a children’s fitness tax credit so parents can claim up to $1,000 for expenses related to fitness and sports activities (source, PBO analysis)
Relaunch a children’s arts tax credit to claim up to $500 for expenses related to arts and educational activities (source, PBO analysis)
Increase the government’s contribution to an RESP from 20 per cent to 30 per cent for every dollar invested up to $2,500 a year (low-income parents would receive 50 per cent on the first $500 they invest every year) (source, PBO analysis)
Reduce personal income tax payable by exempting the spouses or common-law partners of individuals who own a Canadian-controlled private corporation from the tax on split income (source, PBO analysis)
Restore full access to the small business tax rate for corporations earning more than $50,000 in passive investment income in a given year (source, PBO analysis)
Create a 20 per cent refundable tax credit for green improvements to homes of over $1,000 and up to $20,000 (source, PBO analysis)

NDP platform

Increase the capital gains tax inclusion rate from the current 50 to 75 per cent (source)
Roll back the Conservatives’ corporate income tax cuts by three percentage points to 2010 levels (18 per cent) (source)
Create a “super-wealth tax” of one per cent on wealth exceeding $20 million, including “luxury items” like real estate and investments portfolios. (source, PBO analysis)
Increase the top marginal tax rate by two points to 35 percent (source)
Close stock option loopholes and crack down on shell companies operating in tax havens (source)
Require web giants, such as Netflix, to charge QST and GST, and hold them to the same standards as Canadian cable companies (source)
Put in place a 15 percent foreign buyers tax on purchases of residential property by foreign corporations or people who are not citizens or permanent residents (source, PBO analysis)
Put in place income tax averaging for artists and cultural workers (source)
Double the Home Buyer’s Tax Credit to $1,500 (source)
Waive the federal sales tax on zero-emissions vehicles purchases and provide a $5,000 federal purchase incentive (source)
Make the Canada Caregiver Tax Credit refundable (source)
Expand the Volunteer Firefighters Tax Credit (source)
Put in place a new tax credit for graduates to work in designated rural and Northern communities (source)

Green platform

Establish an arm’s length Federal Tax Commission to analyze the tax system for fairness and accessibility (source)
Increase the federal corporate tax rate from 15 to 21 per cent (source, PBO analysis)
Close several tax loopholes, including stock options as part of an executive’s remuneration package to pay a lower rate and a capital gains loophole (source, PBO analysis, PBO analysis)
Tax funds from offshore havens and require companies prove their foreign affiliates are functioning businesses for tax purposes (source, PBO analysis)
Apply a corporate tax on transnational e-commerce companies doing business in Canada (e.g. Netflix, Facebook, Amazon, Google, Uber) by requiring the foreign vendor register, collect and remit taxes where the product or service is consumed (source, PBO analysis, PBO analysis)
Impose a financial transactions tax of 0.2 per cent in the finance sector (source, PBO analysis)
Charge a five per cent surtax on commercial bank profits (source, PBO analysis)
Exempt new and used electric and zero-emission vehicles from federal sales tax (source)
Implement a tax on large corporations that is equivalent to the income tax paid by employees who have been laid off due to artificial intelligence—with small business being exempt—and use that revenue to fund educational and transition programs for those laid-off (source)
Increase the tax credit for volunteer firefighters and search and rescue volunteers (source)
Introduce an international tax for aviation and shipping fuels earmarked for the Global Climate Fund (source)
Prohibit Canadian business from deducting advertising costs on foreign owned websites, like Facebook or Google (source)
Eliminate the 50 per cent corporate meals and entertainment expense deduction (source, PBO analysis)
Remove the sales tax on medicinal cannabis products (source, PBO analysis)
Tax sugary drinks (source, PBO analysis)
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Old 10-04-2019, 08:18 PM   #3
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For taxes I like the Liberal proposal. It’s simple and almost Universal. I would prefer it being universal rather than then have an income cut off. I like the idea of a luxury goods tax however it would need to be monitored carefully if it just drove purchases out of country.

The universal tax cut in the conservative plan is good but the rest of the boutique tax cuts are terrible. We have evidence that things like the transit tax credits and children art/sport credits do not increase participation but instead just reward those who already do the activity. It’s just bad economic policy.

I haven’t really looked at the NDP or Green tax plans yet.
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Old 10-04-2019, 08:25 PM   #4
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For taxes I like the Liberal proposal. It’s simple and almost Universal. I would prefer it being universal rather than then have an income cut off. I like the idea of a luxury goods tax however it would need to be monitored carefully if it just drove purchases out of country.

The universal tax cut in the conservative plan is good but the rest of the boutique tax cuts are terrible. We have evidence that things like the transit tax credits and children art/sport credits do not increase participation but instead just reward those who already do the activity. It’s just bad economic policy.

I haven’t really looked at the NDP or Green tax plans yet.
This is precisely the problem with it. Terrible idea that changes spending habits. And it is net negative in that it results in people doing more of their spending outside of Canada.
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Old 10-04-2019, 08:37 PM   #5
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The other problem with it is that it doesn't increase taxes, it forces a redistribution.

Take auto sales as an example. Large ticket items are where dealerships make their profits. Adding the luxury tax reduces those sales. It also forces the dealership to provide incentives to bring those sales back, cutting their profit margins. That means reduced incomes and staff at the dealership - bad economically.

Then there is the problem of: which luxury items should be taxed? The government ends up picking winners and losers. Taxes need to be universal and fair. Random luxury taxes are the furthest thing from universal.
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Old 10-04-2019, 08:44 PM   #6
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The other problem with it is that it doesn't increase taxes, it forces a redistribution.

Take auto sales as an example. Large ticket items are where dealerships make their profits. Adding the luxury tax reduces those sales. It also forces the dealership to provide incentives to bring those sales back, cutting their profit margins. That means reduced incomes and staff at the dealership - bad economically.

Then there is the problem of: which luxury items should be taxed? The government ends up picking winners and losers. Taxes need to be universal and fair. Random luxury taxes are the furthest thing from universal.
Yeah I think I agree it isn’t really practical but I like the concept of taxing excess.
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Old 10-04-2019, 08:53 PM   #7
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Yeah I think I agree it isn’t really practical but I like the concept of taxing excess.
And I think that's the crux of it. It seems like a great idea because hey - people that buy luxury items can afford it. So let's tax luxury spending - who's going to disagree with that?

The problem is that luxury spending is extremely fluid - it just shifts elsewhere. And luxury spending is highly profitable, the last thing you want is to chase it away.

Going back to autos - luxury items subsidize the base models. If you reduce the profitability on big ticket items, you have to charge more for economy models. Everybody loses.
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Old 10-04-2019, 09:26 PM   #8
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On the other hand, luxury taxes on high wealth products means folks with more money have less propensity to walk away from a sale because of a tax. Poorer people would more likely walk away from extra tax. Additionally, what advantage is there to buying a car from out of the country unless there is a significant cost savings to go through all the trouble? Much like if you had a PST in Alberta, I doubt the PST would prevent rich folks from buying luxury items even though they currently enjoy a lower sales tax.

If the luxury tax is applied to things over $100, then it's not really a luxury tax as much as it is an everyday tax on private modes of transportation. That's a different story.
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Old 10-04-2019, 10:02 PM   #9
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I think they meant $100.000

And it isn't that a person would buy the luxury car elsewhere, it is that they would spend more of their money elsewhere. It's macroeconomic changes. Fewer luxury items sold overall.
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Old 10-05-2019, 08:04 AM   #10
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One thing that I like in the NDP and green platforms is the taxing of Netflix type services. These shouldn’t be exempt because of the online nature.
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Old 10-05-2019, 08:49 AM   #11
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One thing that I like in the NDP and green platforms is the taxing of Netflix type services. These shouldn’t be exempt because of the online nature.
I also like that the Greens want to create a a commission to start looking at closing loopholes and going after tax dodgers. Don't know how successful such a thing would be but it's nice to see one party talking about it because it's a severely under-discussed problem in Canada.

The NDP's idea of giving a tax credit for new graduates to work in Northern/rural communities is smart, too, as long as they don't mess with the current living allowance stuff.
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Old 10-05-2019, 08:58 AM   #12
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One thing that I like in the NDP and green platforms is the taxing of Netflix type services. These shouldn’t be exempt because of the online nature.
Absolutely. Which again comes back to universality - different delivery methods (or products, or industries, or whatever) should not result in different tax consequences.
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Old 10-05-2019, 10:13 AM   #13
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I also really don't like the Conservative plan for the reasons GGG mentioned. It's one really good policy mixed in with a bunch of really poor and ineffective policies.
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Old 10-05-2019, 11:15 AM   #14
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The CPC one is fine... nothing particularly interesting about it. The reduction in the bottom rate is basically a $600 tax cut for most people. I don't care about the boutique tax credits for things like sports, but the one for improving the energy efficiency of homes without actually specifying how the homeowner has to do that is probably going to result in some good stimulus. And I'm not sure why the subsidy for using public transit was ever eliminated in the first place.

I'm not sure why the LPC plan isn't just raise the exemption for everyone. It's simpler and I can't imagine the cap makes that big a difference to revenue. But maybe I'm just annoyed that I don't get anything out of it, you freeloaders... I do like the 50% cut to corporate taxes for net zero emissions, in theory. Have no idea if anyone's done any analysis as to what the anticipated effects will be. The luxury goods tax is just populist "see, we hate the rich as much as the NDP and Greens do" signaling - it's good politics but pretty bad policy. I wonder if there'll be a spike in fancy car purchases between now and next budget if they win, though - kind of like gun sales going through the roof after a shooting.

I guess the other aspect of it is, given their record in 2015, which part of this are they just saying they'll put in place but won't actually do...

The NDP platform basically amounts to "everyone pays more for everything". Increasing the CG rate by 50% is obviously bonkers. Wealth taxes don't work - how are you planning to do a valuation on everyone's assets? Is the CRA about to double in size? Meanwhile, the home buyer's tax credit goes up by a whopping $750. Phew, now everyone can afford to buy their own place.

The Green platform is a pretty good example of what's wrong with the Greens. That bit about proving that foreign affiliates run active businesses not only makes no sense, it probably requires re-negotiating more or less every tax treaty Canada is a party to. It's quintessential "we aren't going to win so it doesn't matter what we put in here" stuff.
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Old 10-05-2019, 12:20 PM   #15
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The reason why the subsidy for public transit is terrible is it doesn’t increase ridership. It rewards rather than incentivizes. So instead of spending $200 per rider on a tax break you could instead spend it on transit.

Same with the sports tax credits they don’t increase participation. So fund infrastructure for sports or subsidize entry at time of registration or subsidize lower income.

I agree the home Reno one as part of a CO2 reduction platform may be worthwhile.
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Old 10-05-2019, 12:24 PM   #16
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Re-establishing income-splitting for couples is also a good idea. The idea that two couples, one earning $100k and $0K, and the other earning $50k and $50k, would pay (substantially) different taxes, is silly.
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Old 10-05-2019, 12:50 PM   #17
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Meanwhile, the home buyer's tax credit goes up by a whopping $750. Phew, now everyone can afford to buy their own place.
It's a stupid proposal. The whole conversation on affordable housing in this country has gotten warped and conflated with affordable homeownership. They're not the same thing and the goal shouldn't necessarily be to get everyone into homeownership as easily and quickly as possible.
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Old 10-05-2019, 12:52 PM   #18
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Re-establishing income-splitting for couples is also a good idea. The idea that two couples, one earning $100k and $0K, and the other earning $50k and $50k, would pay (substantially) different taxes, is silly.
Should there not be a limit on that though? Seems like a loophole for the wealthy if not.
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Old 10-05-2019, 01:08 PM   #19
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Re-establishing income-splitting for couples is also a good idea. The idea that two couples, one earning $100k and $0K, and the other earning $50k and $50k, would pay (substantially) different taxes, is silly.
That's a bad example, as those two couples would pay pretty similar taxes. In Alberta the first couple would pay $23,150 in taxes ($26,900 minus the $3,750 saved from transferring the lower earning spouse's personal exemption) and the second one would pay $22,200, for a difference of $950.

And I really don't see how it makes sense to disincentive the non-working person or lower earning spouse by effectively taxing that person at the higher earner's marginal rate for any income they earn.

It's a measure that almost solely benefits high earners in traditional family units where one member can afford to not work. It provides essentially nothing about 2/3rds of the population.
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Old 10-05-2019, 01:14 PM   #20
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That's a bad example, as those two couples would pay pretty similar taxes. In Alberta the first couple would pay $23,150 in taxes ($26,900 minus the $3,750 saved from transferring the lower earning spouse's personal exemption) and the second one would pay $22,200, for a difference of $950.

And I really don't see how it makes sense to disincentive the non-working person or lower earning spouse by effectively taxing that person at the higher earner's marginal rate for any income they earn.

It's a measure that almost solely benefits high earners in traditional family units where one member can afford to not work. It provides essentially nothing about 2/3rds of the population.
This is what I was trying to say. For a family with a single-income earner making $100k, yeah you can argue that maybe it's more fair. Once we start getting above that, it just seems like a tax break for the wealthy.
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