Get Ready for 7% GST Talk

It’s already started.

In an opinion piece in The Toronto Star last Wednesday, Bruce Campbell, executive director for The Canadian Centre for Policy Alternatives suggests that “taxes appear to be coming back into fashion.”

Apparently we have different fashion consultants.

The logic is that we need to get the country “back into the black,” and that “tax cuts cost us more than we can afford.”   But clearly, it would be sold on the basis of bolstering medical programs.   He races to this conclusion:

Reversing the Harper GST cuts is also important. The additional $12 billion a year our federal coffers would gain from restoring the GST to 7 per cent (with an expanded tax credit to protect low-income earners) could build a national pharmacare program and a home-care program for our senior citizens. It could fund a national child-care program for the next generation of young Canadians. It could plant the seeds for a green economy.

In Ontario, that would mean a 15% HST.   Most of our tourist dollars — as important in the Christian bookstore trade as it is in shoe stores and bakeries — come from Americans who don’t understand how a value-added tax works, and furthermore, don’t see the VAT on their receipts in the UK and elsewhere because it’s included in the pricing.

Not so here.

Stephen Harper’s political credentials are built squarely on the foundation of his reputation as a policy guy.   It was his policy to cut the GST from 7% to 5%.   He’d have to spend a lot of political capital to convince the electorate that this is merely a case of “that was then and this is now.”