Buried in the federal government’s recent Update of Economic and Fiscal Projections are figures showing the Harper government is set to squeeze federal government’s role to the smallest it has been in seventy years. (Bill Curry at the Globe also just wrote about this, but without figures further back than 1958).
Total federal government spending as a share of the economy is projected to drop to a 14% share of the economy by 2018/19. This would be the lowest since at least 1948. Because the government has tied the federal public service up in knots, actual spending will likely (Read more…)
What’s in a name? That which we call a rose, by any other name would smell as sweet. – William Shakespeare
Organizations that aim to safeguard assets create effective operational and audit controls. They also respect codes of ethics like that of SCMA, a group of professionals working in procurement, contract administration and materials management. It states, “…members must ensure that the objectivity of their decisions is not compromised or unduly influenced by the acceptance of gifts, gratuities, or hospitalities of any kind. Members should be discerning in their business and social relationships and activities…”
Protections are particularly (Read more…)
Despite claims that natural gas will last almost forever and drop massive wealth into BC’s treasury, I’ve demonstrated here, with numbers taken from finance ministry documents, that natural gas production contributes little to BC’s public treasury through royalties.
The amount that might otherwise be payable for current production is reduced by credits allowed gas companies; credits that amount to public subsidies of the fossil fuel industry. At the end of fiscal year 2013, $934 million of credits that will reduce future natural gas royalties remain outstanding. Despite previous complaints of Auditor General John Doyle, government has not recorded this amount (Read more…)
After Telus, Teck Resources Limited ranks as the largest BC company, by sales. In three years 2010 to 2012, Teck booked revenues of $31 billion, almost half from the sale of BC coal. According to audited financial statements, Teck accrued resources tax of less than $600 million, under 2% of gross revenue.
In the same period, 2010 to 2013, the British Columbia government collected $8 billion from all exploitation of resources, including metals and minerals, oil and gas, forestry, water, land tenures and other.
Right-wing partisans often denounce the transfer of wealth from the rich to the poor. They fall (Read more…)
I’ll be with Ian Jessop on CFAX 1070 today, discussing natural resource revenues accruing to the British Columbia government.
In the last seven years, provincial revenues from ferry fares and medical services premiums increased almost 40% but natural gas royalties declined by 91%. Actually, that doesn’t tell the whole story because government provides credits to gas producers that will offset future royalties. BC Liberals choose not to record the accumulated liability for these credits. They amount to $934 million in 2013, an increase of $160 million in the liability during the fiscal year. Were generally accepted accounting principles in (Read more…)
British Columbia’s revenue from natural resources totalled $4 billion in fiscal year 2001. The Bank of Canada inflation calculator shows the equivalent in current dollars is $5 billion.
Natural resource revenue received by the province in fiscal 2013 was $2.5 billion, half the value, in constant dollars, returned to the province by the resource sector when BC Liberals took office.
Petroleum, natural gas and minerals returned $1.3 billion in 2013 compared to $2.4 billion in 2001, adjusted for inflation. That seems strange considering commodity prices are up by well more than inflation. Examples:
BC coal production: ( (Read more…)
In its June budget update, the BC Government said,
“When the carbon tax was introduced, one of the key principles was that the tax would be revenue neutral – that all carbon tax revenue would be returned to individuals and businesses through reductions in other taxes and not used to fund government programs. The principle of revenue neutrality will be maintained.”
How do we know the carbon tax is revenue neutral? Well, because the BC Liberals say it is. They cannot demonstrate reductions – except in corporate accounts – so the only available claim is that citizens would have (Read more…)
Before the May 2013 election, BC Liberals promised the entire provincial debt, budgeted this year at $62.5 billion, could be eliminated within 15 years with government proceeds of natural gas production.
In fact, the time frame is likely a bit longer. Actually, more than 500 times longer.
The most recent financial reports show natural gas royalties contributed $169 million to BC government revenues in the fiscal year ended March 31, 2013. However, drilling credits owed producers grew by $161 million in the same period.
Failure to record credits was one of the issues that prevented Auditor General John (Read more…)
Much of my youth was spent in the coastal mill town of Powell River. Paying excellent wages, the pulp, paper and lumber company directly employed almost 2,500 workers. It hired the town’s young people and provided trades training through apprenticeships and skill development programs. Managers and supervisors were promoted from the regular workforce. Retirees lived their final years with reasonable pensions that included extended healthcare and pharmaceutical coverage.
Small enterprises in Powell River had the company as their best customer because it bought many supplies and services from nearby businesses. It paid substantial property taxes to the municipality and contributed (Read more…)
Turns out the Young Liberals at the University of Calgary is seen as an organization of real influence by the US State Department. Below is a quote from Wikileaks that talks about how the UofC Liberals were able to influence the policy of the party and shake up a whole other party. 6. (SBU) The […]
It has recently been reported that the University of Alberta wants to “reopen two-year collective agreements” with faculty and staff “to help the university balance its budget…”
This appears to be in direct response to Alberta’s provincial government announcing in its March budget that there would be a “7% cut to operating grants to universities, colleges, and technical institutes.”
This strikes me as a curious turn of events, for several reasons.
-Alberta’s top income tax rate (i.e. the provincial share) is a mere 10%. This is the lowest of any Canadian province or territory. By contrast, (Read more…)
Last fall, Greek magazine editor Kostas Vaxevanis published in his magazine Hot Doc a list of 2,000 wealthy Greeks who were hiding taxable savings in the Geneva branch of HSBC. The list had been furnished years earlier by the then French finance Minister Christine Lagarde to the Greek government, who did nothing in regards to chasing after the money or the offenders (the list has since been labelled the “Lagarde List”). In fact, one former Greek finance minister, George Papaconstantinou, claimed that he had “lost” the list. He is currently being investigated by Greek’s parliament for altering the list by (Read more…)
On April 23, the Fraser Institute released the annual update of their misleading Consumer Tax Index report. The piece is meant to feed the anti-tax sentiment with numbers sprinkled liberally for their shock value instead of providing any meaningful analysis. Here are some of the main flaws with the report’s methodology.
If what follows sounds familiar, it’s because I’m drawing heavily from the analysis I did in 2010 here, here and here. All of these critiques continue to apply to the 2013 report, which is based on the exact same problematic methodology as earlier editions employed.
The Fraser Institute’s (Read more…)
Read Committee studying offshore tax evasion will not question revenue minister at The Globe and Mail.
This story comes from the USA but Canadian companies employ similar schemes of tax avoidance. In fact, most of the companies listed here have large Canadian operations. One of the reasons that companies doing business in British Columbia wanted to maintain HST is that, under that system, they avoided nearly all sales taxes.
Many had already managed to avoid income taxes through off shore affiliates and shelters but they wanted to eliminate local consumption taxes as well. The $2 billion of BC sales taxes
. . . → Read More: Northern Insight: Tax issue the Harper Gov’t prefers not to address
Former Canadian Taxpayers Federation Alberta Director Scott Hennig, now the group’s Communications VP, in a nice AstroTurf-coloured sweater at last weekend’s Ottawa conference of the Manning Centre for Undermining Democracy. Below: CTF President Troy Lanigan; CTF member … rrrrrrr … supporter, Riley Climenhaga; CTF Operations VP Shannon Morrison.
When it comes time to hand out the annual Turfy Award – named for AstroTurf, the green synthetic blades that look like grass and feel like grass but do not absorb carbon dioxide like grass – I expect the Canadian Taxpayers Federation to be a contender.
Indeed, consider ’em nominated.
. . . → Read More: Alberta Diary: Minuscule Canadian Taxpayers Federation in running for ‘Turfy Award’
By Canadians for Tax Fairness | Feb. 18, 2013: The growing use of tax havens is costing Canadians an estimated $7.8 billion annually, the executive director of Canadians for Tax Fairness has told a Parliamentary committee studying the issue. “Tax haven use is at an all-time high in Canada,” C4TF’s Dennis Howlett said in his brief to the READ MORE
A new CCPA (National) report by Marc Lee and myself argues that Canada’s tax system needs a “fairness” overhaul and presents a framework for progressive tax reform. Those of you who have been following our tax work so far will find this study a great complement to the BC Tax Options Paper.
Tax policy is an important lever for governments to tackle income inequality, which is why it is particularly important to strengthen tax fairness now, given the increased concentration of income and wealth we’re seeing in Canada. We also call for a comprehensive tax review of the entire system
. . . → Read More: The Progressive Economics Forum: Fairness by design: a framework for tax reform in Canada
Further to Toby’s comments, Miles Corak has posted an excellent commentary on the new numbers on high incomes, together with a spread sheet showing average effective tax rates by income group from the 1980s. The big story is that the average effective tax rate for the very affluent has been stable since the early 1980s as their income share has grown, and that the average effective tax rate for high income groups has fallen significantly since the early 1990s.
I posted an Economy Lab piece on this as well. While opinions will differ on what is fair, I think the
Statistics Canada’s release on the escalating incomes of the top 1 per cent gained a lot of media coverage — and also provoked some very defensive reactions by major organs of the Canadian media.
This included an almost rabid column by Financial Post editor Terence Corcoran accusing Statistics Canada of engaging in class warfare and, in a McCarthyite manner, personally attacking some of their existing and former employees. (I guess he doesn’t read the New York Times much, where that well-known communist Warren Buffett was quoted as saying “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”)
The Globe also weighed in with an editorial urging us to “Hug the 1 per cent“ claiming they get a bad rap and that they are a net benefit to Canada because they pay more than their share in income taxes. The Globe editorialists . . . → Read More: The Progressive Economics Forum: Canada’s bloated 1 per cent
This is a guest blog post written by Whitehorse-based economist, Luigi Zanasi. Please feel free to comment. Also, please note that this was written before Marc’s blog post of Jan. 14 re: BC’s carbon tax.
Towards a fair cap & trade system for GHG emissions
In the last two federal elections, the NDP quite rightly rejected the idea of a carbon tax for greenhouse gas emissions. The party did the same in the past BC election, a position that probably lost it the election because of the outraged Greens. Jack Layton and now Tom Mulcair argue for
. . . → Read More: The Progressive Economics Forum: GHG Cap & Trade
An oped of mine was published by the Vancouver Sun today:
What’s next for BC’s carbon tax?
Climate change forced its way onto the political agenda in 2012, as Hurricane Sandy ripped through the northeast United Stages just days before the election. And while action remains frustratingly slow, extreme weather disasters in the billions of dollars are making a statement that politicians can no longer ignore. The costs of our addiction to fossil fuels are starting to pile up, and we cannot afford to keep dithering.
Recent surveys show that the public is ahead of the politicians in
. . . → Read More: The Progressive Economics Forum: What’s next for BC’s carbon tax?
With less than 20 weeks before the BC election, our Liberal government continues spending tax dollars to promote themselves. It’s not the first time they aimed to influence the vote with government-paid advertising. This is from an opposition press release after the 2005 vote:
“Following revelations that the Campbell government deliberately overspent its advertising budget by $7.5 million to produce pre-election ads, NDP Leader Carole James today re-iterated her call to ban all partisan advertising by government…”
Now almost eight years later, with Clark’s Liberals in bigger trouble, the amounts have escalated. As Adrian Dix told The Tyee
. . . → Read More: Northern Insight: "Improved" PST will look much like HST
Many commentators claim BC Liberals are incompetent and ineffective. While true in ministries such as Justice and Children and Family Development, Liberals have been successful in the centerpiece of their strategic plan. Startlingly successful.
In 2001, Gordon Campbell’s platform document promised a “business environment that is second to none” and BC Liberals have consistently delivered on that objective.
My last article discussed reduction of the public share of revenues from mining and petroleum industries. In fiscal 2001, the last year of NDP rule, the province earned $2.1 billion in forest and water revenues. Eleven years later, the Liberal
. . . → Read More: Northern Insight: BC Liberals’ startling success
A paper produced for the Business Council of British Columbia in 2010 stated:
“Since 2001, British Columbia’s natural gas sector has experienced nothing short of phenomenal growth…”
Mineral production in the province has also trended upward, as demonstrated by this chart, prepared from government statistics:
Despite this, government experienced one deficit after another and taxpayer supported debt rose to incomprehensible levels. At March 2012, BC Hydro owed more than $73 billion in direct debt and future energy purchase commitments.
So, if gas production experienced “phenomenal growth” and commodity prices have been through a cycle of high prices, I
. . . → Read More: Northern Insight: Of shoes–and ships–and sealing-wax–of cabbages–and kings