Alex Himelfarb has an opinion piece in today's Globe and Mail on the 'anti-tax' sentiment that has grown to play such a dominant role in Canadian politics. Although I agree with his diagnosis, his prescriptions are not so much a plan for countering anti-tax sentiment as they are a symptom of its hold on public discourse.
We have to be smart about taxes and we will all have to carry the burden. The consensus among economists was that cutting the GST was a mistake, and most would also defend the HST. And sooner or later we are going to have to put a price on carbon to share the costs of a new economic and energy paradigm.
What is disappointing is where he goes with this: calls for increased taxes on the rich and on corporations. I don't have a problem with increasing tax rates on high earners, although I have my doubts as to how much revenue they will generate and as to just who will actually pay them (,). And although the suggestion that increasing corporate tax rates is harmless because they don't affect employment betrays a fundamental misunderstanding of the issue, that's not the problem here, either.
No, the problem is that Himelfarb proposes the tax measures that are most likely to appease anti-tax sentiment: he suggests increasing taxes that almost everyone thinks they won't have to pay. Increasing taxes on the top 1% doesn't inconvenience the other 99% of the population. And if you're part of the vast majority of voters unfamiliar with the economics of tax incidence, you might be tempted - wrongly - to think that you won't have to pay corporate taxes, either.
Himelfarb does well to remind us that there is no free lunch, but his point is greatly blunted by offering instead lunches at a 99% discount. The real challenge is to persuade voters to accept the responsibility of paying full price for what goverments provide.