Want to understand how Christian values can translate into responsible taxation policy?
CPJ’s public justice framework supports the notion that taxes are an important contribution to the common good.
The majority (75%) of Canadians believe taxes are good because they pay for important things that contribute to a positive quality of life.
Over the past decade, significant changes have been made to Canada’s tax system, including deep cuts to tax rates. The impact of these changes is a cause for concern, as taxes are an essential way that we as citizens fulfill our obligation to promote justice and to respect the right of all people to live in dignity
CPJ makes the following policy recommendations:
A progressive tax system is where people with higher incomes pay a greater share of their income in taxes.
Fairness and equity in the distribution of federal and provincial taxes are pressing issues today given the recent growth of income inequality in Canada, and the associated increase in the concentration of income and wealth.
The continuing trend of tax cuts for high-income individuals and corporations has disproportionately benefited a select few at a high cost to our nation’s economic and social well-being. Canada needs a fair tax system that ensures sufficient federal revenue and creates a vibrant economy that benefits all people.
The revenue generated by corporate taxes plays an important role in building and maintaining Canada’s physical and social infrastructure. Yet successive cuts in recent years have rendered Canada’s combined federal and provincial corporate tax rates the second lowest among G7 countries.
These tax cuts have cost Canadian families dearly by shifting the balance between individual and corporate taxes. While corporate tax cuts reap marginal benefits, citizens pay the price through lost programs and opportunities.
Corporations also have an obligation to help sustain the public services and physical infrastructure that contribute to their productivity and enable them to generate wealth.
Tax expenditures are a form of government spending. Instead of writing a cheque or providing a service, the government spends by choosing not to collect certain tax income. Tax expenditures come in a variety of forms such as tax exemptions, deductions, rebates, referral or credits.
Some tax expenditures (such as the Canada Child Benefit or the Working Income Tax Benefit) do accomplish important policy outcomes in a transparent way. Yet boutique tax credits like the Children’s Fitness Tax Credit and the Public Transit Credit mainly benefit wealthy individuals and families and should be eliminated or replaced with spending programs.
CPJ recommends a thorough review be conducted of tax expenditures in Canada.
A carbon tax places a price on emissions of greenhouse gases by taxing carbon containing fossil fuels. It is an effective, efficient way to curb energy use, and help offset the harmful impacts of climate change. The money raised from a carbon tax should be used as credits for low-income people, for programs that help families and businesses to adapt, to encourage the development of new, green practices and technologies, and as investments into clean energy infrastructure in order to facilitate the transition off fossil fuels.
CPJ recommends a coordinated carbon tax of at least $30/tonne GHG emissions, with planned regular increases to at least $160 by 2030.