Current political orthodoxy suggests that income tax increases are a thing of the past, and that only by continuing to reduce the tax 'burden' on both individuals and corporations can prosperity for all be assured. Happily, that specious argument is coming increasingly under fire.
The central thesis of The Trouble With Billionaires, written by Linda McQuaig and Neil Brooks, is that the growing inequality gap being experienced in North America can be narrowed by a return to the notion of progressive taxation directed at the ultra-weathy who now pay a historically low rate on the tremendous income they enjoy. Soundly reasoned and within a rich historic context, the authors make some compelling arguments for their vision. It is reading I highly recommend.
Similarly, in a recent op-ed piece for the New York Times, share one of the world's richest men, Warren Buffet, makes a similar request. He says people with wealth of his magnitude, and there are many such individuals, need to be taxed at substantially higher rates, given that they owe much to the countries that have made it possible for them to prosper, offering an effective challenge to the myth of the self-made man or woman.
A few days later, a group of French billionaires made the same plea, arguing that they can and should do much more to help their country's economy. 16 company executives, business leaders and super-rich individuals called for the creation of a "special contribution" that would target wealth without forcing the rich to quit France for overseas tax havens.
In a recent Toronto Star article entitled Where is Canada's Warren Buffet, Larry Gordon asks the pointed question of why Canadian wealthy elites are not offering similar help to our country.
Sadly but predictably, the political establishments in the aforementioned countries don't seem to be listening. Indeed, in the United States, the extreme right, aka The Tea Party, has mocked and lambasted Buffet for his proposal.
And in Canada, neither of the two main opposition parties federally has shown any enthusiasm for the idea. During the recent federal election, the boldest suggestion made was to roll back some of the corporate tax cuts. Not a mention was made of increasing individual rates.
We have to wonder why the shyness exists. For the NDP, it is perhaps to avoid the traditional association of being the party of high taxation as the only solution to inequality. The Liberal and The Conservative reticence on the issue is consistent with the contention made by many that despite the facade of democracy reinforced by going to the polls every four years or so, the voice of the people is not the voice these parties listen to. Rather, they listen to those with whom they most identify and stand to benefit from, the economic elite of the country.
At one time, I would have attributed such a notion to the rather overwrought ravings of the extreme left. Today, I see it as a realistic assessment of the current sad state of politics in North America, a state where few politicians dare challenge the orthodoxy of spending cuts as the way to a productive and responsible economy, resulting in societies that increasingly seem to afford benefits only to a select few.
It is time that we we begin to force a change in the conversation. More about that soon.
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A simple increase of income tax percentages or additional tax brackets won't solve the problem. The ultra-rich have all kinds of tax loopholes they can take advantage of to hide their money away from the taxman. Many of these involve hiding wealth within a corporation that can deduct almost anything to avoid paying tax. Some of the richest people in the world never show up in Forbes.
ReplyDeleteThe CBC sort of has an article but their sole source of information seems to be tax lawyers who exploit the loopholes and are somewhat, umm, biased. The article may be full of neo-liberal double-speak, but the comments are pretty good.