By Chris Beach

Northern View

Northern View – Time for a flat tax

Jan 18, 2023 | 12:41 PM

Another new year is upon us and so it’s tax season once again.

I’ve always wondered about the logic of the entire process where we spend our own time and money gathering documents and hiring accountants to tell the government how much tax we paid – only to have them spend countless taxpayer dollars to confirm we are telling the truth and then, hopefully, give us back a chunk of the tax that they’ve already collected. Small businesses and large corporations of course have more of an incentive, as their costs to run and maintain their businesses are generally tax deductible. But they too spend considerable resources to prove to the government how much they are spending in order to cut down their annual tax burden.

Doesn’t this all seem a bit counter-productive and inefficient?

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Why not just let citizens keep more tax dollars in the first place and avoid a multi-billion-dollar private tax industry and government bureaucracy? Certainly, there are better things we could spend this money on, like improving healthcare and replacing our rapidly aging urban infrastructure. Do we maintain this system because that’s the way it’s always been done? Because there’s no other way?

There is another way. It’s called a flat tax and it’s being used by dozens of countries around the world to make them more equitable, efficient, competitive, and wealthy.

It made Hong Kong one of the most prosperous and fastest growing economies in modern history up until the Communist Party crackdown a few years ago.

It’s a system where for example all working individuals who make enough to hit a minimum threshold might pay something like 15% across the board, and there would be no need for tax returns.

But the key is that many large corporations would have to pay their fair share too – more than most of them are now paying – to make up for employees paying less.

With record profits and sky-rocketing CEO salaries, making large corporations pay their fair share of taxes to support a system and a workforce they greatly benefit from, is a good idea.

But it wouldn’t all be bad news for large companies – they could eliminate their costly full time tax departments and benefit from greater financial certainty. In a future of escalating government costs and global competition, a flat tax makes sense for Canadians and for Canada.

Editors note: The views expressed in this column do not necessarily represent the views of Pattison Media.