One of the complicated issues relating to running for Mayor in the City of Winnipeg is the expectations of the voters wanting each candidate to explain:
1) What are you going to do?
2) Why should I vote for you?
This often results in as Bartley Knives indicates in his very good summary of the campaign thus far in his article ‘(Some) campaigns picking up steam: A look at the landscape in the mayoral race’ a torrent of promises. The other complicated issue is many of the major issues relating to economic growth, poverty alleviation, crime reduction, tax fairness and infrastructure improvement are not entirely something the Mayor or City Council can solve or is even in their power to solve unilaterally.
The requirements of a Mayor necessitate being an advocate for the City of Winnipeg and its people. It is essential the Mayor understand policy implications at the Municipal, Provincial and Federal Level. The City of Winnipeg is able to generate very little revenue to make the impact on infrastructure as a result of some inequities that have resulted by policies of both the Provincial and Federal Government.
A website every Canadian should visit is called ’Canadians for Tax Fairness’. It provides some excellent discussion points about the data and the truth about Tax Fairness in our country.
Many people would describe Property Taxes as a necessary evil, but in Winnipeg and in Manitoba, it is counter-intuitive to the economic and educational growth the tax is intended to provide. Property Taxes, by most experts, is considered to be a regressive tax, as it impedes growth. Manitoba is the last province that relies so heavily on Property Tax as a method to fund education. Historically property taxes were seen by local communities as a way to address the unique educational needs of their communities. However, with provincial curriculum, educational policies, standards and most of what happens in schools in regards to programming, assessment and reporting is now mandated, therefore the rationale has lost its validity. Education is 100% the provinces responsibility (except on Reserves-more on that later), as well as the responsibility of every Manitoban, not only property owners. Even if School Divisions no longer collected educational taxes; despite what some may say; the need for School Trustees would still be required as representatives of the community’s voice and an integral part of the accountability process for education. Their role may become less focused on budget issues and more focused on student outcomes.
Every property owner in Winnipeg when they open their letter from the Assessment and Taxation Department look to the bottom of the page to see how much they owe. They then will see how much goes to the City and how much goes to education. The City of Winnipeg has no control over the education portion of property taxes and for that matter neither do the Trustees of the School Divisions. When the province mandates educational policy and standards (which they should) the School Divisions must create and provide the systems and provide the resources to ensure these standards are reached.
The money needs to come from somewhere. Education is an essential component in the well-being of our society now and in the future. Property Taxes for education needs to end and the 35% of Education Taxes that are generated that way need to go back to the Province to fund. Currently the Province tries to make political points by giving money back to property owners and now even more if you are a senior. For more information on this matter visit: letsplayfair.com.
Imagine opening your Tax Bill and seeing it be cut in half. Imagine what that does to your spending money or the ability for business to develop the many empty lots in Winnipeg, improve property without the worry of increasing value. Imagine what it means to small business and their ability to grow and expand. The province could look at numerous other ways to fund education which the foundational principal would be to create a more equitable way to fund education.
This is a larger and more complicated issue which currently is eroding our human infrastructure and negatively impacting police services, ambulance services as well as the need to address the associated impact of what increased poverty does to the cost of many of our essential services. In Canada, child poverty remains high as well as the discrepancy between those that have and those that do not. This discrepancy is having a negative impact on Canadian unity. The majority of Canadians have seen a decrease in their disposable income resulting in everyone trying to maintain their standard of living with less. The double–edged sword of course is that if we don’t address poverty now, the costs associated with poverty such as medical, social services and crime will increase, resulting in the long-term costs continuing to balloon. We have high unemployment when it comes to full-time jobs for young people and 1/3 of people in poverty have jobs, but are the working poor.
In the 1960’s more than 25% of seniors lived in poverty. This was unacceptable to Canadians and pressure was put on the government and society to solve this issue. The solution was the development of Old Age Security, the Canadian Pension Plan as well as Medicare to ensure all Canadians were able to benefit from being Canadian. It is those systems developed to assist all Canadians that also help provide Canadians with a social safety net that minimized our impact during the last global recession. The solutions needed today will require similar innovative changes to our taxation system to support families, decrease child poverty and provide people with full-time work.
The tax system can be a key tool for redistributing wealth. Closing the gap between rich and poor is not only a moral and ethical imperative, it is also critical to restoring a healthy society and a healthy economy.
Taxes could reduce inequality and boost economy: by Dennis Howlett, 05/22/2014
This is not to say the only solution is to increase taxes on the wealthy or on corporations but we do need to close Tax Haven loop holes immediately. Many G7 countries have already done so. Secondly, if the rationale for decreasing taxation for corporations is to create employment and that is not being accomplished despite profits and income of Canada’s wealthiest Canadians growing, then the Government needs to tax the so-called ‘Dead Money’ as former Bank of Canada Governor Mark Carney indicated. We need to create tax incentives that reward corporations who help strengthen communities and encourage growth of jobs and help educate Canadians to become part of the workforce.
A fair tax policy is essential to reducing income inequality and to re-building Canada. Since 1981 Corporations have seen a 40% reduction in their tax rate and this does not include the tax relief legally or illegally obtained through Tax Havens. At the same time individuals are paying more and small businesses that are often the life-blood of growth in local communities have also not benefitted to the same degree from Federal Government Tax Policies. The OECD states the top one per cent of Canadian pre-tax income earners captured 37 per cent of the overall income growth between 1981 and 2012, and now account for 12.2 per cent of the country’s total annual income.
All of this could be tolerated if as indicated by our Prime Minister that the reason for decreasing tax burden for Corporations and the wealthy was to create jobs. This has not been accomplished, rather, what has occurred is the decreasing of full-time jobs, decreasing of salaries and an increase burden on the so-called ‘Middle Class’ to support Canada’s economic and social infrastructure.
The bottom-line is that by decreasing taxes for corporations, the support to assist all Canadians has also lessened. The untruthfulness of the rhetoric that lower taxes for the wealthy benefit everyone has not worked and our government has no evidence to support this is helping Canada be a better stronger, healthy country. A fairer tax system is needed and even one perhaps that can vary from corporation to corporation depending on the business’s committment to the creation of full-time jobs. Many Canadians have fallen victim to blaming the poor as being the problem rather than looking at what the data is actually telling us. This blame game is destroying the Canadian social fabric.
A simple example of excess of the wealthy is the purchase of car for 38 million dollars. The purchaser of the car did not want to be identified but if I was a business owner that 38 million dollars means a salary of $50, 000 a year for 760 employees. For the government, it means receiving taxes from 760 people were previously not paying taxes. It means more money for families, fewer children in poverty and an increase in spending in the local community benefitting small and local businesses. It means a reduction in social costs for our communities, increased employment and increased revenue to support our social programs benefitting all Canadians. Hey, but perhaps one person got a 38 million dollar car from the money they didn’t pay tax on because they took advantage of the loopholes in our taxation system.
This is certainly not something a Mayor or Winnipeg can solve alone, as Taxation is a Federal issue. It is estimated that by closing some of these loop holes and making a fairer tax system could net at least $40 billion dollars a year for Canada to invest in health, education and infrastructure development of our crumbling cities and towns. It would mean we wouldn’t need to have a fire sale of ‘Green Space’ in the City of Winnipeg to fix our roads. It would mean we could support children and families in the way that will benefit society today as well as in the future. It would mean jobs, training and a much-needed influx of capital for municipalities to address the issues related to roads, public transportation, public safety, frozen pipes, snow removal and creating a greener, more sustainable Canada.
This requires a leader, a mayor, who is vocal and will challenge the Federal Government to address these tax inequities that are putting such a heavy financial burden on provincial and municipal governments.
PART 2 (to be posted Sunday, August 31st) and discuss issues relating to Sustainable Development, City Planning as well as the need for an inquiry into Missing and Murdered Woman and I will include protection of children as well.