High Canadian taxes are the most urgent task facing the next Canadian parliament. Following through on the Liberal election promise of tax cuts is urgent business. Thus far, the Canadian economy has gotten a free ride on the speeding US economic locomotive. Despite this, our productivity growth and standard of living continues to lag. If the North American economy slows while Canadian taxes are still unreasonably high, Canada will be thrown even farther behind, and tens of thousands of Canadians and families will suffer as jobs are destroyed across the nation.
Taxes are a job killer, particularly during economic setbacks.
Canadian policy-makers need not look only to the United States to understand the curative power of tax cuts. While Canadian taxes have remained punitively high, other nations, from the UK to Ireland to the Netherlands, to name a few, have been aggressively cutting taxes. In all cases, the outcome of significant tax reduction was stunning economic growth, job creation, and increased government revenues. Nor should tax cuts be seen as an ideological policy. The evidence on tax cuts is so impressive that governments of all stripes have embraced them.