OTTAWA—The Conservatives’ proposed 3-point reduction in corporate tax rates would cost the public purse $6 billion per year, yet only stimulate about $600 million of new business investment annually, says a study released today by the Canadian Centre for Policy Alternatives (CCPA).
Corporations and corporate power
OTTAWA – La réduction en trois points des taux d’impôt que proposent les Conservateurs coûterait au Trésor 6 milliards de dollars par année, mais elle entraînerait seulement quelque 600 millions de dollars de nouveaux investissements des entreprises par année, affirme-t-on dans une étude dévoilée aujourd’hui par le Centre canadien de politiques alternatives (CCPA).
This study examines historical data on business investment and cash flow from 1961 through 2010, and, using econometric techniques, finds no evidence in the historical data that lower taxes have directly stimulated more investment.
Business fixed capital spending has declined notably as a share of GDP and as a share of corporate cash flow since the early 1980s—despite repeated tax cuts that have reduced the combined federal-provincial corporate tax rate from 50% to just 29.5% in 2010.
OTTAWA—After a decade of corporate tax cuts, the benefits to Canada’s largest corporations are clear but the job creation payoff for Canadians hasn’t materialized, says a study released today by the Canadian Centre for Policy Alternatives (CCPA).
The study, by CCPA Research Associate David Macdonald, tracked 198 of the 245 companies on the S&P/TSX composite that had year-end data from 2000 through 2009 and found those 198 companies are making 50% more profit and paying 20% less tax than they did a decade ago.
This study tracks 198 companies on the S&P/TSX composite from 2000 through 2009 and finds those companies—Canada's largest corporations—are making 50% more profit and paying 20% less tax than they did a decade ago.
However, in terms of job creation, they did not keep up with the average growth of employment in the economy as a whole. From 2005 to 2010, the number of employed Canadians rose 6% while the number of jobs created by the companies in the study grew by only 5%. In essence, the largest beneficiaries of corporate tax cuts are dragging down Canadian employment growth.
Over the past 30 years, Canadians have increasingly been led to believe that community compassion expressed through charitable food handouts is the most effective way of feeding our hungry poor and homeless. Since the establishment of the first food banks in the early 1980s, domestic hunger has become increasingly socially constructed as a matter for philanthropy, not as a political and human rights issue necessitating the priority attention of governments.
Why should a provincial government be punished for doing the right thing?
That’s a question the citizens of Newfoundland and Labrador - and all Canadians - should be asking themselves in the aftermath of last summer’s decision by the Harper government to pay AbitibiBowater $130 million to settle a NAFTA lawsuit.
Last week, the Commons Standing Committee on International Trade held hearings into the NAFTA settlement. Property rights advocates loudly complained that Ottawa shouldn’t have to foot the bill for the “irresponsible actions” of the Danny Williams government.
On March 4, 2011, the Financial Post published an article by Niels Veldhuis and Milagros Palacios titled, “We need Scott Walker here.” Scott Walker is the Governor of Wisconsin who is funded in part by the wealthy Koch brothers and is leading the assault against American public sector unions.
It is not coincidental that whether to run Bi Pole III down the east side of Lake Manitoba or the west side of the province is becoming a controversy just before the provincial election, but it is also true that as we collectively begin to acknowledge our negative impact on the environment, polemics of this nature will become more common, elections or not.
Tonight, the Toronto District School Board is debating a motion over whether or not to extend a pilot project that currently sees flat screens being installed in four high schools across the city. If accepted, screens would be installed in 70 schools and 20 more schools in January.