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CD Howe Institute still firing corporate spin at sinking tax ship

Corporate tax contributions so low they could barely twist an ankle if they fell any further.

by Erin Weir, The Progressive Economics Forum

September 10, 2009 — Should we care that the marginal effective tax rate on capital is higher in Prince Edward Island than in Serbia?

Of course, this question is a joke. But the CD Howe Institute actually did put out a press release last week singling out PEI for its allegedly high business taxes compared to an average of 80 countries, among which Serbia is the star.

This Institute, which is governed and funded by corporate Canada, has been extremely influential in shaping Canadian tax policy. The federal corporate income tax rate is being cut in half between 2000 and 2012. Provincial corporate income taxes are also falling and corporate capital taxes are gone. All but three smaller provinces have removed, or will soon remove, their sales tax from business inputs.

Despite all of these ongoing business tax cuts, Jack Mintz still got back in the saddle to co-author yet another Tax Competitiveness Report. But the result is tantamount to flogging a dead horse.

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The original argument was that Canada's corporate taxes needed to be competitive with the US...

To read further, please click on the links below:

Links and sources
  Tax Competitiveness 2009: Flogging a Dead Horse, by Erin Weir, The Progressive Economics Forum, September 10, 2009
  The 2009 Tax Competitiveness Scorecard: An "Eye-popping" Divergence in Approach across Canada, CD Howe Institute, September 3, 2009

Posted: September 10, 2009

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