Article Summary
Taxation and the Role of the State: A Report Card on the Charest Government
Economic Note by Tasha KheiriddinIn this economic note Tasha Kheiriddin presents a summary of the Charest government’s achievements, particularly with regard to its promises to provide tax relief and to reduce the role of the state.
In its 2002 Action Plan, the Quebec Liberal government stated it would reduce personal income taxes by $1 billion over five years. Kheiriddin suggests that promise has not been kept. Over its tenure, the Charest government has reduced taxes by $626 million, far short of the $3 billion required to meet the pledge cited in its Action Plan. Further, the author argues “in its official documents, the government inflates personal income tax cuts by adding refundable tax credits and amounts resulting from the indexing of tax brackets.” The tax cuts are actually credits to families and low-income earners, therefore, they can’t really be considered tax cuts.
The only “real” tax cuts, Kheiriddin suggests, come from simplifying the tax regime and introducing a $500 reduction for workers. Revenues from personal income tax have increased 11 percent since 2002-2003. Further, Quebec taxpayers have endured a hidden tax increase in the form of “parental insurance.” The author also discusses taxes for businesses and the government’s capital spending.
The Charest government also said it would “modernize the state,” a plan that included lightening government structures (including the abolition of certain bodies) and reassessing some government programs. A task force created in 2004-05 studied the 60 bodies and recommended abolishing only six bodies and making some modifications to others. In 2006, the Quebec government abolished 16 bodies, but in reality, Kheiriddin asserts, half of those bodies’ responsibilities were transferred to other departments. In addition, new bodies were created to administer new programs; overall, she posits, results have been very modest. The author concludes by stating the Charest government’s results are modest and ambiguous at best.
(Added: Mon Mar 12 2007 Hits: 86 Rating: 0.00 Votes: 0) Rate It Review It
Policy Publication Details
| Author(s): | Tasha Kheiriddin; | ||
| Publisher: | Montreal Economic Institute [ Visit Website ] | ||
| Year Published: | 2006; | Publisher Type: | Research Institute |
| Publicly Available: | Yes | Research Focus: | Provincial; |
| Registration Required: | No | Language: | English |
| Payment Required: | No | Publication Format: | Adobe PDF, Hard Copy |
Subjects / Categories:
Policy Articles / Fiscal & Budgetary / Tax Policy
Policy Articles / Regional & Sectoral / Quebec
Policy Articles / Economy / Provincial Economy
Policy Articles / Economy
Policy Articles / Fiscal & Budgetary
Policy Articles / Regional & Sectoral
Policy Articles / Economy / Provincial Economy / 2006
Policy Articles / Fiscal & Budgetary / Tax Policy / 2006
Policy Articles / Regional & Sectoral / Quebec / 2006
Keywords / Tags:
Charest government; tax relief; Action Plan; personal income tax; tax cuts; governmnent structures;