Summary:
The cited article is a brief update on the current corporate tax cut dispute that is occurring amongst the federal government of Canada. Currently, the federal government is pursuing the final phase of their 5 year corporate tax cut plan, but is seeing strong opposition by the Liberal party. The reasoning behind the federal government’s decision on decreasing the corporate tax cut was to create more jobs and investment opportunities in Canada, boosting the economy. However, the liberal party disagrees with the federal government and claim that “the tax relief is no magic solution for stoking job creation and increased investment” The liberals are now securing a firm ground on opposition to the new plan in a possible election concerning this, noting that this is not the correct approach when the federal government is still in a deficit.
Connections:
The current struggle for the correct approach on the corporate tax system is a viable example for the key concepts engraved in chapter 4 of our economy textbook, which is about the overall involvement and actions of government in the economy. Since taxation is one of the more notable controls of the government, it is elementary to see the connection between the article and the concepts involved. Further analysis could be made on the difference between the federal and provincial, yet another core concept of the chapter. It demonstrates how provincial governments do not have any power in this struggled to control the corporate taxes. Provincial governments are more responsible for the healthcare, and education of their own assigned region, rather than affairs that concern the country as a whole.
Reflection:
This article was a very good example to show the involvement and struggles of government intervention in an economy. In my opinion, it gives more depth to the final decision that governments make, whether you agree or disagree with them. It shows the consideration and care that goes into the final decision of the government. Referring back to the argument about decreasing the corporate tax, I would have to side with the proposition against the decrease of corporate tax. I am not convinced that merely decreasing the amount of tax a corporation must pay will increase their willingness to hire more employees; it is indeed no magical solution for creating jobs in my opinion.
3 comments:
This article was really informative for me. It helped me have a better understanding of the aspect of corporate taxes. I agree with you that decreasing the corporate tax will not suddenly create jobs. If companies paid less tax, they could keep more of the profit for themselves and keep their employment rate the same as it is now. With that said, however, I don't think raising the corporate tax would be a good idea either, because both profit and employment rate could potentially drop. It's interesting to see what theories the federal government bases their decisions on. Overall, a really well-written summary, keep up the good job!
Joshua Thang
Economics 12
Yes, I agree with the federal government to cut corporate taxes because when corporate taxes are high, it cause businesses to encourage lay off people and discourage creating job opportunities. Due to recent recession, many people have been laid off as a result. This has caused a significant jump in Canada’s unemployment rate. The federal government saw this as major crisis and that it must be solved right away. However I disagree with the Liberal’s plan of increasing corporate taxes. Since the Liberal government’s philosophy is about helping people in need such as homeless people, they would want higher taxes in order to help the needy. I disagree with this idea because I don’t understand why we as workers have to have part of our salary taken away in order to feed homeless people who did nothing to gain those benefits. They did not contribute to the labour force and also when the government gave the homeless people job opportunities, the homeless people did not take the offer. Therefore I do not support increasing the tax. I liked it how you make strong connections between article and the textbook. After reading your article, I have now realized how tax is a major problem to our society and that there is no wrong answer to either support or disagree with taxes. Also your reflection was very thought out and in-depth. You have given your full opinion and supported it really well with evidence. Excellent job!
Good find Benny! However, I disagree with what Joshua has said. How can we be so sure that the tax cuts will go towards hiring more employees and not the corporate heads’ wallet? Why do we assume that all the money collected goes toward feeding the needy? It goes towards helping middle-class as well as high-class families. I believe that the liberals approach is on the right path. Not only will it help the homeless get off the street, it’ll help fund programs to get them back on the right path. It’ll help with the middle-class family in the form of public service such as Medicare. Anyways, nice blog Benny, good job!
Post a Comment