A North Cowichan councillor is proposing a new solution for the revenue woes of local government.
Make the corporations pay.
Rob Douglas wants to institute a new 1% tax on big corporations in B.C., with the proceeds flowing to municipalities.
The idea was recently endorsed by the Association of Vancouver Island and Coastal Communities, who will take it to the Union of B.C. Municipalities. If endorsed there, it will be presented to the provincial government.
“The response had been really positive,” said Douglas. “I think a lot of our local politicians recognize that with the downloading from senior levels of government we can’t keep turning to property taxes and user fees can be very regressive revenue tools. We’re going to have to find new options to address this downloading. Hopefully this is just the start of something bigger.”
He emphasized this is not for small businesses and would not place an undue burden on large corporations either, he said, as B.C. currently has the second lowest corporation tax rate of all of the provinces and territories, and Canada’s federal rate is also low.
Douglas sees this as the start of a broader conversation that needs to begin about the whole taxation system.
“If you look back to our parents’ and grandparents’ generation, the period after the Second World War was a period of unprecedented growth and prosperity and equality,” he said. “And we introduced a very progressive tax system which allowed us to create and fund these generous social programs. We’ve seen over the last few decades that this has slowly been eroded and chipped away at and at some point enough is enough.”
Taxing big corporations “more appropriately” is a good beginning, Douglas said.
Tax cuts for corporations in recent years, Douglas said, have not put more money into circulation in the Canadian economy as was the purpose of those cuts, but instead have led to huge corporate cash reserves.