Ontario 2018 election
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DC Al Fine
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« Reply #575 on: April 02, 2018, 05:17:07 AM »

Or perhaps while not thought of a lot if the PCs only win a minority, the Liberals could agree to let them govern provided they choose a different leader, although that is probably stretching it a little too much.  I could only see this happening if the Liberals and NDP do gang up and then caucus feeling they could break this with a different leader forces Ford out and once the PCs get a new leader the agreement falls apart.  But even that seems unlikely.  Had the PCs not been so stupid and chosen Elliott instead of Ford this would probably be a non-issue as she is not nearly as divisive as he is.

That's a stretch to say the least. The ensuing leadership race/party infighting would make the recent PC leadership look like a teddy bear picnic. Ford would go down swinging.

Just because the BC NDP and Greens made that half coalition to force out a four term conservative government (which is way way different than the scenario were discussing here) doesn't mean the rules of politics have changed forever. If there's a Tory minority, it's far more likely the Liberals (and maybe NDP) pick a new leader and Ontario goes to the polls in 18 months like the bulk of minority governments in the past century.
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adma
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« Reply #576 on: April 02, 2018, 07:23:40 AM »

If there's a Tory minority, it's far more likely the Liberals (and maybe NDP) pick a new leader and Ontario goes to the polls in 18 months like the bulk of minority governments in the past century.

Or sooner than 18 months, given the Tory leadership.
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« Reply #577 on: April 02, 2018, 08:49:59 AM »

Having reviewed the budget, and realizing how the government has not planned for any way of paying for any of it (trivial raise in taxes; and cigarette taxes amounting for a whopping 0.2% of revenue), what are the odds the NDP attacks the Liberals for being fiscally irresponsible? There is nothing actually inherently right wing about being fiscally responsible; in fact the NDP has a long track record of balanced budgets in other provinces. I know when Mulcair ran on a balanced budget in the federal election it kind of backfired, but with an unpopular Liberal Party, it might be away to win over some centrist voters who don't want to vote for either Ford or Wynne. Of course the downside is the NDP might have to promise to raise taxes in order to pay for their promises, and that might not go over well.
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mileslunn
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« Reply #578 on: April 02, 2018, 09:28:36 AM »

Having reviewed the budget, and realizing how the government has not planned for any way of paying for any of it (trivial raise in taxes; and cigarette taxes amounting for a whopping 0.2% of revenue), what are the odds the NDP attacks the Liberals for being fiscally irresponsible? There is nothing actually inherently right wing about being fiscally responsible; in fact the NDP has a long track record of balanced budgets in other provinces. I know when Mulcair ran on a balanced budget in the federal election it kind of backfired, but with an unpopular Liberal Party, it might be away to win over some centrist voters who don't want to vote for either Ford or Wynne. Of course the downside is the NDP might have to promise to raise taxes in order to pay for their promises, and that might not go over well.

I think if they raised taxes on those making over 100K it wouldn't hurt them too much as most making those incomes don't vote NDP anyways and those concerned about a potential brain drain also probably don't vote NDP either.  Yes raising corporate and the top rates has dangers in making Ontario less competitive (Top rate if you combine with federal is 53.53% which is 2nd highest in North America behind Nova Scotia and one of the highest in the OECD), but that would more be something the PCs would attack. 

As for Mulcair losing on balanced budgets, the polls I've seen show most were in favour of deficits in the 2015 election, but today want a balanced budget not deficits.  And that makes some sense as even if most haven't taken economics or understand Keynesian theory, many understand you run deficits when the economy is underperforming (In 2015 it was with near zero growth) and you run surpluses when overperforming (It is now with 3% growth and record low unemployment).
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« Reply #579 on: April 02, 2018, 11:15:02 AM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?
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lilTommy
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« Reply #580 on: April 02, 2018, 11:48:58 AM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

Good Question -
http://www.macleans.ca/economy/economicanalysis/the-2018-ontario-budget-in-charts-and-numbers/

38.7% Health Care!
18.3% Education
13.1% "Other programs"
11.3% Children and Social Services
7.9% Interest on Debt
7.4%  Postsecondary and Training sector
3.2% Justice Sector

Revenue sources are interesting as well:
23.4% Personal Income Tax
17.6% Sales Tax
17.1% Federal Transfers
11.5% Other Non-Tax Revenues
9.9% Corporate Tax
4.3% Employer Health Tax
4.0% Education property tax
3.9% Other Tax
3.5% Income from Gov`t business enterprises
2.6% Health Premium
2.3% Gas and Fuel Taxes

** The NDP is already going to be running on higher corporate taxes, that`s pretty much a given.
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DC Al Fine
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« Reply #581 on: April 02, 2018, 12:12:03 PM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

In no particular order:

1) Ontario doesn't have the resource revenue that Alberta and Saskatchewan do.

2) Although Ontario is technically a have not province, they are just barely so. Provinces like Nova Scotia and New Brunswick receive similar equalization payments to Ontario, but of course that's way more revenue per capita for the Maritimes.

3) Ontario pays more interest on debt per capita than every province except Newfoundland and Quebec.

4) Taxing the rich raises less money than you'd think. Middle class and HST rate increases tend to rack up more revenue.
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mileslunn
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« Reply #582 on: April 02, 2018, 12:14:07 PM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

The reason for this is overall taxation is low by OECD standards.  In most of Europe the difference comes in much higher sales tax rates.  The HST is 13% in Ontario while in most European countries VAT rates are 20-25%.  Federally each point in the GST is $7 billion so adjusting for population difference essentially every point in HST is $3 billion so if raised to 20% it would be $21 billion extra and if raised to 25% (That is what it is in the Nordic Countries) would be $36 billion extra so that is where the difference comes from.  Off course raising HST like that would be political suicide for any party, but that is the reason.  Also debt level servicing is another as the three most Western provinces have top marginal rates under 50% and more in line with the OECD and G7 averages (BC 49.8%, AB 48%, SK 47.5%, while France 54.5%, Japan 55.9% so higher than ON, but Italy 45.8%, Germany 47.5%, UK 45% ((47% if you include National Insurance)), US 37% to 50.3% depending on state) so that is another advantage of having a lower debt.  All provinces from Manitoba eastward have debt to GDP ratios above 30% and top marginal rates over 50% whereas all provinces west of that have debt to GDP ratios under 16% and top marginal rates under 50%.  Off course had Mulcair been PM the top marginal rates wouldn't have gone up federally so less of an issue as Ontario's top rate would be 49.53% so only slightly above the G7 average.  Ironically enough Trudeau only got an extra $1.5 billion in revenue from the 4% hike in the top rate as it just led to more aggressive accounting.  Case and point, many executives switch to stock options which are taxed at half the rate.
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mileslunn
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« Reply #583 on: April 02, 2018, 12:20:21 PM »
« Edited: April 02, 2018, 12:29:41 PM by mileslunn »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

Good Question -
http://www.macleans.ca/economy/economicanalysis/the-2018-ontario-budget-in-charts-and-numbers/

38.7% Health Care!
18.3% Education
13.1% "Other programs"
11.3% Children and Social Services
7.9% Interest on Debt
7.4%  Postsecondary and Training sector
3.2% Justice Sector

Revenue sources are interesting as well:
23.4% Personal Income Tax
17.6% Sales Tax
17.1% Federal Transfers
11.5% Other Non-Tax Revenues
9.9% Corporate Tax
4.3% Employer Health Tax
4.0% Education property tax
3.9% Other Tax
3.5% Income from Gov`t business enterprises
2.6% Health Premium
2.3% Gas and Fuel Taxes

** The NDP is already going to be running on higher corporate taxes, that`s pretty much a given.

Problem with raising corporate taxes is with US cuts Canada has lost its competitive advantage.  Now Ontario could raise theirs from 11.5% to 12% which would bring it in line with all four Western provinces and just above Quebec by 0.1% but amount of revenue gained would be minimal.  Sales tax hike as per earlier post is where you can get the most revenue.  Also European countries tend to have higher payroll taxes and many even fund their social programs completely through those.  Another possibility is have the top rate kick in at a much lower level.  In the Nordic Countries, top rates kick in between 60K to 80K equivalent so it hits a lot more people whereas Ontario's is 220K so far fewer taxpayers hit.  In Netherlands where their top rate is 52% (dropping to 49.5% next year), it kicks in at only 67,000 Euros, while Belgium who has a top rate of 50% (It is 50-54.5% when you include municipal) kicks in at 38,000 Euros only.  Germany's top rate kicks in at 250,000 Euros, however the 42% rate (44.3 when you include solidarity surtax) kicks in at 54,000 Euros.  In UK top rate kicks in at 150,000 pounds, but the 40% one kicks in at only 54,000 Pounds.

In California, their top rate is close to Ontario's but kicks in at a million USD so affects very few people never mind marginal rates are only what you make over that amount not total.  Also another one that stands out is federal transfers as those before the mid 90s used to be a lot higher, but don't count on those being raised anytime soon.

Some will claim HST is regressive which is true, but also most European countries have lower rates for essentials as opposed to non-essentials and we could just up the rebates anyways in terms of both dollars and those who qualify.  The thing about sales taxes is they are tough to avoid so you generally get every dollar you anticipate whereas with corporate and income taxes you have to factor in behavior changes thus rarely realize the full amount.
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EarlAW
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« Reply #584 on: April 02, 2018, 01:53:05 PM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

Good Question -
http://www.macleans.ca/economy/economicanalysis/the-2018-ontario-budget-in-charts-and-numbers/

38.7% Health Care!
18.3% Education
13.1% "Other programs"
11.3% Children and Social Services
7.9% Interest on Debt
7.4%  Postsecondary and Training sector
3.2% Justice Sector

Revenue sources are interesting as well:
23.4% Personal Income Tax
17.6% Sales Tax
17.1% Federal Transfers
11.5% Other Non-Tax Revenues
9.9% Corporate Tax
4.3% Employer Health Tax
4.0% Education property tax
3.9% Other Tax
3.5% Income from Gov`t business enterprises
2.6% Health Premium
2.3% Gas and Fuel Taxes

** The NDP is already going to be running on higher corporate taxes, that`s pretty much a given.

Yeah, I saw that chart, but wanted something more detailed.

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

The reason for this is overall taxation is low by OECD standards.  In most of Europe the difference comes in much higher sales tax rates.  The HST is 13% in Ontario while in most European countries VAT rates are 20-25%.  Federally each point in the GST is $7 billion so adjusting for population difference essentially every point in HST is $3 billion so if raised to 20% it would be $21 billion extra and if raised to 25% (That is what it is in the Nordic Countries) would be $36 billion extra so that is where the difference comes from.  Off course raising HST like that would be political suicide for any party, but that is the reason.  Also debt level servicing is another as the three most Western provinces have top marginal rates under 50% and more in line with the OECD and G7 averages (BC 49.8%, AB 48%, SK 47.5%, while France 54.5%, Japan 55.9% so higher than ON, but Italy 45.8%, Germany 47.5%, UK 45% ((47% if you include National Insurance)), US 37% to 50.3% depending on state) so that is another advantage of having a lower debt.  All provinces from Manitoba eastward have debt to GDP ratios above 30% and top marginal rates over 50% whereas all provinces west of that have debt to GDP ratios under 16% and top marginal rates under 50%.  Off course had Mulcair been PM the top marginal rates wouldn't have gone up federally so less of an issue as Ontario's top rate would be 49.53% so only slightly above the G7 average.  Ironically enough Trudeau only got an extra $1.5 billion in revenue from the 4% hike in the top rate as it just led to more aggressive accounting.  Case and point, many executives switch to stock options which are taxed at half the rate.

Sounds like we need to start taxing stock bonds more Cheesy


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mileslunn
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« Reply #585 on: April 02, 2018, 02:20:51 PM »


Sounds like we need to start taxing stock bonds more Cheesy




Bonds are already taxed at the full rate, only equities are taxed at 50% (that is 50% of whatever rate you pay so for top marginal it would be 27.26%).  I think the reason Liberals are running deficits is people may not like it but doesn't affect them like tax hikes do.  Raising sales taxes doesn't seem to hurt politically in Europe, but in Canada its quite costly.  HST destroyed Gordon Campbell in BC, GST destroyed Mulroney, and Selinger's big drop in the polls largely came over a 1% PST increase.  In fact the main reason Alberta doesn't have a sales tax is not because it is a bad idea, but polls show any party that introduced one would pay at the polls.

I think that is the problem in Canada is many want Scandinavian style programs but without the taxation they have on the middle class.
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King of Kensington
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« Reply #586 on: April 02, 2018, 03:29:37 PM »

I think that is the problem in Canada is many want Scandinavian style programs but without the taxation they have on the middle class.

That's very true.  The Nordic welfare states are financed by so-called "regressive" taxes but all that revenue has a redistributive outcome.  Of course the top marginal rates are higher too, but overall the Scandinavian tax system is actually flatter than that of the US.  I would argue that the net impact of the tax system in Scandinavia is more progressive.

If you want Scandinavian social democracy you have to tax the middle earners more too.  One strength of the Scandinavian system is that the middle classes actually have a stake in the welfare state too. 
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« Reply #587 on: April 02, 2018, 03:42:11 PM »

I'm not a fan of GST/HST because it's regressive, but I'm not opposed to the idea of taxing certain things if they're 'sinful', so perhaps one idea might be to increase the VAT on items that are harmful to society.
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« Reply #588 on: April 02, 2018, 03:53:31 PM »

Another question for people who understand these things better than me, if Ontario has one of the highest deficits and highest upper income tax rates in the OECD, but doesn't have the corresponding social program spending to go along with it, then where is all the money going to?

I can't speak to Ontario, but usually the answer in other jurisdictions is: nice fiscal arrangements for middle-earners. Low middle-income tax rates, free childcare and low property taxes, for instance. Maybe low sales tax, but in practice lots of jurisdictions make this effectively progressive using exclusions.

Another answer could be: weak demographics, low participation rates, meaning fewer workers and more tax per worker, to pay for more dependents.

The final possibility, rarer nowadays: like the famous top marginal rates in the 1950s USA or 1960s UK, almost nobody is actually in the tax bracket. This doesn't seem to apply to Ontario
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mileslunn
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« Reply #589 on: April 02, 2018, 04:38:10 PM »

I'm not a fan of GST/HST because it's regressive, but I'm not opposed to the idea of taxing certain things if they're 'sinful', so perhaps one idea might be to increase the VAT on items that are harmful to society.

Or you could like most European countries have a two tier system with a low rate for essentials and regular rate for non-essentials.  Usually food, clothing, shelter and other essentials are only 5-10%, but everything else is 20-25%.  Just hitting sin products wouldn't work as not enough but if you exempt essentials that definitely would.  Also the poor would benefit in that yes they pay more tax, but they receive more programs and most with lower income are more impacted by the number of programs available as opposed to tax so as long as it means more programs that greater tax rate would be offset by savings in not paying user fees for many things they do now.
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mileslunn
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« Reply #590 on: April 02, 2018, 05:01:11 PM »

I think that is the problem in Canada is many want Scandinavian style programs but without the taxation they have on the middle class.

That's very true.  The Nordic welfare states are financed by so-called "regressive" taxes but all that revenue has a redistributive outcome.  Of course the top marginal rates are higher too, but overall the Scandinavian tax system is actually flatter than that of the US.  I would argue that the net impact of the tax system in Scandinavia is more progressive.

If you want Scandinavian social democracy you have to tax the middle earners more too.  One strength of the Scandinavian system is that the middle classes actually have a stake in the welfare state too. 

Actually not totally true, but somewhat.  I looked up the tax rates for each and here is what I got.  In Canada bottom rate if you exclude payroll taxes is combined from 20.05% in Ontario to 27.525% in Quebec while top rate is 47.5% in Saskatchewan (44.5% in Nunavut if you include territories) to 54% in Nova Scotia.  If you include CPP and EI then bottom rates range 26.66% to 34.135% although CPP as long as you or your spouse makes retirement age you get back.  EI is a different story as most workers never claim it and many are ineligible anyways.

Denmark:  Top marginal rate is 55.6% so just a little above Ontario, but their tax structure is ridiculously complex so tough to understand.

Finland: National rates are 6.5% to 31.25% while municipal are a flat rate of 16.5% to 22.5% and you have payroll taxes of 7.76% which aren't capped unlike in Canada.  So marginal rates are 23-29% for bottom (30.76% to 36.76% if you include payroll) while top is 47.75% to 53.75% (55.51% to 61.51% if you include payroll) so similar if you exclude payroll but higher when included.

Iceland: Had a flat tax until 2010, but has only two rates, bottom at 36% so much higher than here, but top is 46.2% so similar to what Ontario was in 2011 (It was 46.41% then).  Also kicks in at around 80,000K.  That being said due to its small size you don't need the same level of re-distribution as you would in Canada as pre-tax incomes are a lot more equal than here.

Norway: Bottom rate excluding payroll is 23% (19.5% in the two most northern regions).  Top rate is 38.4% (34.9% in two most northern regions).  Payroll taxes are uncapped and only those making over equivalent of around 7K and are 5.1% for pension income, 8.2% employee income, and 11.4% for self-employed.  Employer pays 5.9% so it is for regular employee a total of 14.1% but you only see the 8.2%.  That means combined top is for pensioners 43.5% (40% two northern regions); regular employees 46.6% (43.1% in two northern regions), while for self-employed it is 49.8% (46.3% in two northern regions), while indirectly if employed it is 52.5% (49% in two northern regions).  So definitely lower than Ontario and lower than all provinces unless self-employed or you include employer portion.  Mind you Norway has a tonne of oil so they can afford lower taxes and more programs.

Sweden: a flat tax at the municipal level of 32%, while a progressive one of 0 to 25% at the national level so marginal rates range from 32% to 57% so a bit higher than Ontario too.

Looking at other Western European countries, here are the top rates I was able to dig up:

Germany: 47.475% so lower by health care is funded through sickness funds and social insurance not general taxes so probably that is the difference.

Netherlands: 51.95% (planned drop to 49.5% next year but not approved yet) there health care also funded through mandatory private insurance subsidized by government based on income

Belgium: 50% to 54.5% depending on municipality (average 53.5%) but if you include payroll taxes average top rate is 56.5% to 60.4% and kicks in at only 38K Euros.

Luxembourg: 45.8% (47.2% if you include payroll taxes) however median incomes are much higher than Canada.

UK: 45% (46% in Scotland) and if you include National Insurance 47% (48%) in Scotland so a bit lower.  Bottom rate is also only 20%, but middle rate of 40% kicks in at a much lower than ours so UK has lower rates for rich and lower middle income, but higher for upper middle income than us.

Ireland: 48% (51% for self-employed); 43% for pensioners, and 52% if you include payroll taxes while 55% total for self-employed.  Their tax rate as a portion of GDP is lower than Canada unlike most Western European countries, but mainly due to ridiculously low corporate tax rate.  Someone like Bono would pay 55% total there thus why he goes offshore.

France: Around 54.5% if you include social taxes.  45% is top rate but you have separate social taxes for welfare state.

Switzerland: Varies by canton and municipality but ranges from as low as 22% to as high as 46%, average of 34%, around 40% in major cities.

Austria: 55% but only over 1,000,000 million Euros and ends in 2021 when top rate falls back to 50%

Portugal: 53%, 58.17% if you include payroll taxes

Spain: 45% (as low as 43% in Madrid while 48% in Catalonia and Andulusia but varies by autonomous community

Italy: 44-47% (varies by region and municipality, average of 45.8%)

Greece: 55%

So as you can see Ontario is not too far off many but tends to line up more with the smaller countries, maybe economies of scale.  But definitely higher than most larger ones although considering how little revenue was received from tax hikes, probably could be cut to 45% (29% federally and 16% provincially) without losing too much revenue, but wouldn't sell well politically.  Lower rates are actually similar in Europe but vary even more widely from as low as 10% to as high as 36%
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mileslunn
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« Reply #591 on: April 02, 2018, 05:05:16 PM »

The final possibility, rarer nowadays: like the famous top marginal rates in the 1950s USA or 1960s UK, almost nobody is actually in the tax bracket. This doesn't seem to apply to Ontario

To the best of my knowledge no country has a top marginal rate exceeding 60%.  Some countries have wealth taxes so if obscenely wealthy it might be possible to be paying more but for income taxes top rates of over 90% like the US once had no longer exist although no one actually paid anywhere close to that, well except for Elvis Presley who had a terrible accountant so IRS got more from him than any other American.  UK had a top rate of 95% in the 60s which is why most British artists went abroad.  Beatles tax man song that says if 5% appears too small or 1 for you 19 for me refers to this.  Paul McCartney today would have a top marginal rate of 45% (Since over 70 he is exempt from national insurance thus not 47%) and I suspect like most rich people he has good accountants so probably pays much less than that.
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« Reply #592 on: April 02, 2018, 07:43:30 PM »

The final possibility, rarer nowadays: like the famous top marginal rates in the 1950s USA or 1960s UK, almost nobody is actually in the tax bracket. This doesn't seem to apply to Ontario

To the best of my knowledge no country has a top marginal rate exceeding 60%.  Some countries have wealth taxes so if obscenely wealthy it might be possible to be paying more but for income taxes top rates of over 90% like the US once had no longer exist although no one actually paid anywhere close to that, well except for Elvis Presley who had a terrible accountant so IRS got more from him than any other American.  UK had a top rate of 95% in the 60s which is why most British artists went abroad.  Beatles tax man song that says if 5% appears too small or 1 for you 19 for me refers to this.  Paul McCartney today would have a top marginal rate of 45% (Since over 70 he is exempt from national insurance thus not 47%) and I suspect like most rich people he has good accountants so probably pays much less than that.

George Harrison wrote Tax Man.  It's amazing that line was literally true.
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King of Kensington
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« Reply #593 on: April 02, 2018, 08:26:37 PM »

Actually not totally true, but somewhat...

Don't forget though that the top marginal tax rates kick in at much lower levels than they do in Ontario/Canada.  Sweden's top rate applies at about CDN$100,000 for example.

Higher tax jurisdictions in the US like New York and California have top marginal rates above 50%, but you have to be in the top 0.5% or so.  Americans think everybody is middle class, so they tend to put their "fat cat" taxes on a tiny of people almost nobody knows.
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mileslunn
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« Reply #594 on: April 02, 2018, 08:39:27 PM »

Actually not totally true, but somewhat...

Don't forget though that the top marginal tax rates kick in at much lower levels than they do in Ontario/Canada.  Sweden's top rate applies at about CDN$100,000 for example.

Higher tax jurisdictions in the US like New York and California have top marginal rates above 50%, but you have to be in the top 0.5% or so.  Americans think everybody is middle class, so they tend to put their "fat cat" taxes on a tiny of people almost nobody knows.

Exactly or at least that is the case in many European countries.  Germany and UK have their top rates kick in at higher levels (150,000 GBP and 250,000 EUR), but the rates at 70,000K equivalent are only a few percentage points lower.  In terms of top rates over 50%, actually New York is not but California is (It is 45.82% in New York state, but New York City due to municipal tax is 49.7%, 37% + 8.82 + 3.976%, while California is 50.3%; 37 + 13.3%).  Now if you include the 2.35% medicare levy than both California and New York City exceed the 50% mark, although not New York state, but as you mentioned only hits those making over $1,000,000 US so such a tiny portion and also a very different cohort.  Those making over a million tend to be mostly wealthy CEOs whereas over 200K it is usually high skilled professionals and people tend to have a negative view of the former but positive of the latter.  The one problem is in Canada we have a lot fewer millionaires than the US so the revenue we would get would be much less.  I imagine in Sweden where income distribution is even more equal, that is probably why the top rate kicks in lower as they would get less at 200K than we do.
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« Reply #595 on: April 03, 2018, 07:16:07 AM »

Ho hum, too much tax talk, not enough election talk.
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Hatman 🍁
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« Reply #596 on: April 03, 2018, 09:19:15 AM »

The final possibility, rarer nowadays: like the famous top marginal rates in the 1950s USA or 1960s UK, almost nobody is actually in the tax bracket. This doesn't seem to apply to Ontario

To the best of my knowledge no country has a top marginal rate exceeding 60%.  Some countries have wealth taxes so if obscenely wealthy it might be possible to be paying more but for income taxes top rates of over 90% like the US once had no longer exist although no one actually paid anywhere close to that, well except for Elvis Presley who had a terrible accountant so IRS got more from him than any other American.  UK had a top rate of 95% in the 60s which is why most British artists went abroad.  Beatles tax man song that says if 5% appears too small or 1 for you 19 for me refers to this.  Paul McCartney today would have a top marginal rate of 45% (Since over 70 he is exempt from national insurance thus not 47%) and I suspect like most rich people he has good accountants so probably pays much less than that.

Taxman confirmed worst Beatles song.
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Krago
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« Reply #597 on: April 03, 2018, 09:42:01 AM »

Ho hum, too much tax talk, not enough election talk.

Georgio Mammoliti has to decided not to run provincially.

https://www.bramptonguardian.com/news-story/8369192-mammoliti-won-t-run-in-brampton-centre-riding-after-all/
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mileslunn
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« Reply #598 on: April 03, 2018, 11:19:53 AM »

On the issue of taxes related to the election.  It's obviously a no brainer the PCs will be against any tax hikes but with tax cuts they have to be careful as whatever hole they leave, that means spending cuts so while their tax cuts will be popular, the potential spending cuts is where the danger is.  Don't know what they will do, but probably smartest would be make their tax cuts noticeable but relatively small in treasury cost or backload them to the final year.  As for tax hikes, raising corporate and income taxes and high net worth individuals is an easy sell, the problem is when you crunch the numbers the amount of revenue you will get is not very much.  You have to raise the HST, fuel taxes, or middle income taxes to gain significant revenue and any of those will be politically harmful.  There is also sin taxes which governments of all stripes raise but again revenue from that is not particularly high, especially in the case of tobacco taxes as smoking rates are declining.  There is off course the marijuana revenue but again you put the tax too high on it, people will just turn to the black market.

As for deficits, my thinking is most NDP supporters probably don't care so no risk for the NDP.  For the PCs most do care so would be politically stupid not to at least have a plan to return to balance even if it takes a few years.  For Liberals its a mixed bag.  Large deficit could cost them some Blue Liberals (but I think Wynne has already given up on them or figures the only way she can win them back is from fear of Doug Ford not support for her) whereas amongst their left flank it doubt it will hurt them.  Apparently the PC platform will be five points and will be released in stages.  Risky in the sense the Liberals will try to poke holes, but could be very effective.  After all that is what Harper did in 2006 and it worked there and he entered the campaign with similar negatives to Ford.  Although he only got a weak minority on his first try, but Paul Martin's approval rating was also a lot better than Wynne's too.
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lilTommy
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« Reply #599 on: April 03, 2018, 12:27:18 PM »
« Edited: April 03, 2018, 12:36:21 PM by lilTommy »

On the issue of taxes related to the election.  It's obviously a no brainer the PCs will be against any tax hikes but with tax cuts they have to be careful as whatever hole they leave, that means spending cuts so while their tax cuts will be popular, the potential spending cuts is where the danger is.  Don't know what they will do, but probably smartest would be make their tax cuts noticeable but relatively small in treasury cost or backload them to the final year.  As for tax hikes, raising corporate and income taxes and high net worth individuals is an easy sell, the problem is when you crunch the numbers the amount of revenue you will get is not very much.  You have to raise the HST, fuel taxes, or middle income taxes to gain significant revenue and any of those will be politically harmful.  There is also sin taxes which governments of all stripes raise but again revenue from that is not particularly high, especially in the case of tobacco taxes as smoking rates are declining.  There is off course the marijuana revenue but again you put the tax too high on it, people will just turn to the black market.

As for deficits, my thinking is most NDP supporters probably don't care so no risk for the NDP.  For the PCs most do care so would be politically stupid not to at least have a plan to return to balance even if it takes a few years.  For Liberals its a mixed bag.  Large deficit could cost them some Blue Liberals (but I think Wynne has already given up on them or figures the only way she can win them back is from fear of Doug Ford not support for her) whereas amongst their left flank it doubt it will hurt them.  Apparently the PC platform will be five points and will be released in stages.  Risky in the sense the Liberals will try to poke holes, but could be very effective.  After all that is what Harper did in 2006 and it worked there and he entered the campaign with similar negatives to Ford.  Although he only got a weak minority on his first try, but Paul Martin's approval rating was also a lot better than Wynne's too.

The NDP has to be careful here two, they have two voting pools: urban/intelligentsia progressives/social democrats and Working class/blue collar/unionized populist/progressives. So Higher corporate taxes (major differentiator from the OLP) is usually a staple in policy as is increasing taxes on the wealthy since both of these groups essentially support this policy. Raising the HST, across the board will not happen. BUT perhaps the ONDP will pull a BCNDP and raise the HST on luxury items (i'd like to see this paired with a decrease on essentials like food, infant products, what used to be the old PST exempt stuff). That could be one way the NDP can run on raising revenues and not turn away their voting pool and potential pool. Hopefully the NDP takes the opportunity to look at BC (and Alberta) to see what's been done there; they can look at a increasing the speculation tax perhaps, and sin tax increases.
I would like to see the party embrace taking back ownership of the 407 as well... and expansion of public assets (more public corporations) but we shall see.

Remember outside of Toronto, especially in SW ontario and the North, the NDP competes primarily against the PCs. These areas is bread-and-butter, pocket book issues that matter.
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