Canadian dollar almost at parity with US, will pass it soon

[Kontiki]

Two things:

A) Debt repayment is mandatory by federal law for surpluses. The only available money from that for other things is the reduction in interest charges from the reduced debt. In the case of the latest budget, that comes to about $725 million.

B) Cutting the GST, especially right now, isn't smart. Not just my opinion, pretty much every significant economist in the country agrees. Cutting a consumption tax only spurs more consumption, which isn't our issue right now. We'd be far better off cutting corporate taxes.

[Wezil]

Originally posted by Kontiki


B) Cutting the GST, especially right now, isn't smart. Not just my opinion, pretty much every significant economist in the country agrees. Cutting a consumption tax only spurs more consumption, which isn't our issue right now. We'd be far better off cutting corporate taxes.

Depends on what you are after. While a cut in income taxes would be better for the economy a GST cut will be much better politically.

Personally I prefer the GST cut. Income tax cut will help only those paying income taxes whereas a GST cut will benefit everyone.

[Flubber]

Originally posted by Wezil


Depends on what you are after. While a cut in income taxes would be better for the economy a GST cut will be much better politically.

Personally I prefer the GST cut. Income tax cut will help only those paying income taxes whereas a GST cut will benefit everyone.

If it was an either-or 1% cut , I would take the cut on my income taxes on the simple I earn more than I spend principle

Kontiki makes a good point though. GST cuts benefit the biggest consumers the most. A 1% cut to the lowest bracket of income taxes would benefit "everyone" (well everyone that earned around 30K or more) the same. Raising the personal exemption amount is an even more focused way of ensuring the benefit is felt "equally" among those that earn taxable income

[Kontiki]

I'm after better, sustainable growth, just like the economists of the major corporations and think tanks, regardless of their political slant. Cutting corporate taxes encourages corporate spending which, theoretically, benefits everyone because it impacts the employment situation, wages and ultimately tax growth through increased revenues. Making your individual purchases a little cheaper isn't nearly as beneficial.

[Flubber]

Oh adn for harper its simple-- He promised the GST cut so he will do it to say he kept his promise and remind us that the Liberals did not.

I do find the whole GST thing hilarious though

Mulrooney was hated for bringing it in. Chretien campaigned on eliminating it but never did. Now the Conservatives are reducing it while the Liberals argue it should stay.

All we need now is for the Conservative to lose an election after scrapping the GST. The Liberal would get elected promising to re-instate it but in the end they simply don't-- Its Bizarroo world

[Wezil]

I earn more than I spend as well but my position is for all, not just me.

Your "everyone" only includes those that actually work. While a GST cut would aide bigger consumers more, it would aid all consumers somewhat (not just those working). I'm not against an Income tax cut, I just want as many as possible to experience a benefit.

[Wezil]

Originally posted by Kontiki
I'm after better, sustainable growth, just like the economists of the major corporations and think tanks, regardless of their political slant.

I'm not against your/their theories. I agree but that is not the politically "smart" thing to do.

Income tax cuts will come eventually. Let's take the GST cut now.

[Victor Galis]

I personally favor a reversal of the decision to tax income trusts.

[Flubber]

Originally posted by Kontiki
I'm after better, sustainable growth, just like the economists of the major corporations and think tanks, regardless of their political slant. Cutting corporate taxes encourages corporate spending which, theoretically, benefits everyone because it impacts the employment situation, wages and ultimately tax growth through increased revenues. Making your individual purchases a little cheaper isn't nearly as beneficial.

Although since monetary policy usually tries to discourage inflation, shouldn't tax policy try to be in accord. Much of canada is already suffering labour shortages so I am unsure how much eople necessarily want any MORE growth at the moment

This may change as the high dolllar starts to hurt the auto and manufacturing industry but currently it seems like wages and job creation have been doing pretty well. You did say "sustainable growth" and there are many that believe we actually need to slow things a little to avoid/ameliorate very serious boom/bust cycles

[Flubber]

Originally posted by Victor Galis
I personally favor a reversal of the decision to tax income trusts.

That one again. I think if they reversed that, it would be a terrible policy decision. In time the corporate form would almost disappear as everyone chased the huge tax advantages of trusts. The structure actually does not even work particularly well but the tax savings were so significant that you would have soon seen the five major banks converted to trusts

[Kontiki]

Originally posted by Flubber


Although since monetary policy usually tries to discourage inflation, shouldn't tax policy try to be in accord. Much of canada is already suffering labour shortages so I am unsure how much eople necessarily want any MORE growth at the moment

Yeah, but that's another reason to favor corporate or personal tax cuts over GST cuts - with the former, there will be a lag before the effects are fully felt, whereas with the latter, it's an immediate push.

Not too sure about your labour shortages affecting much of the country, though.

[Wezil]

I hope the Income Trust reversal causes the Torys political pain though. They deserve to suffer for that election lie.

[Wezil]

Originally posted by Kontiki
Not too sure about your labour shortages affecting much of the country, though.

TORONTO - The Conference Board of Canada says non-union wage increases will average nearly four per cent in 2008, with the highest raises going to people in labour-starved Western Canada.

It says Alberta's worker shortage is creating a "ripple effect" that puts upward pressure on wages right across the country.

As a consequence, attracting and retaining talent remains a high priority for companies, says the Ottawa-based think-tank.

The four western provinces are expected to see average wage gains above the national average - with Alberta seeing the highest at 5.2 per cent.

Forecasts for Ontario, Quebec and the Atlantic provinces see wage increases as well, but below the national average.

The conference board also predicts that Alberta's labour market will continue to get tighter as fewer people move there due to higher living costs and improving economic opportunities in neighbouring provinces.

Wage settlements for unionized workers are forecast to average 3.1 per cent in 2008.

http://cnews.canoe.ca/CNEWS/Canada/2007/10/30/4617285-cp.html

[Victor Galis]

Originally posted by Wezil
I hope the Income Trust reversal causes the Torys political pain though. They deserve to suffer for that election lie.

Conservatives everywhere have it in for me personally. Wiping out a good chunk of my wealth with the income trust decision (had they announced it during the campaign, it would have been priced in before I ever bought into the trust). The GOP has made a fine mess of the American dollar and thus my earnings this summer. It's like the lefties want to take my money and give it to the poor, the righties just want to make my money dissappear.

But more seriously, I think we need to develop industries that are not dependant on exporting to the US. I'm not sure how exactly the government can do that.

[Flubber]

Originally posted by Kontiki




Not too sure about your labour shortages affecting much of the country, though.

Most of it is low end jobs but in both Halifax and St. John's Newfoundland there are "help wanted" signs everywhere and news stories about employers that cannot find enough workers or getting one response to a newspaper ad seeking workers/

Apparently it is not quite so bad but also there are issues in a lot of trades in eastern canada. So many have moved or worked away for so long that there are not enough of them in Atlantic Canada.


Alberta-- the employment situation is insane-- Elaboration is not really necessary

Saskatchewan-- they have actually mounted missions into Alberta to try to convince workers to come back

Its anecdotal but I have seen news stories about different types of labour shortages from 4 provinces including 3 that are generally in the have-not category-- I suspect but don't know that there would be similar pressures across the country.

The exception may be Ontario withy some recent job losses in the auto industry. Maybe the Ontario folks can chime in with what they see