The Canadian Tax System Explained - In Beer

[Spokes]

Its nice to see reasonable debate here once in a while, without alot of rhetoric and name calling. Well done gentlemen.

[JakeYYZ]

As for the connection between corporate tax rates and jobs, I agree that the connection is tenuous. Even though countries like Bermuda, British Virgin Islands, and the Bahamas have low corporate tax rates, it does not mean that they generate huge numbers of jobs. Instead, corporations are often structured so that the risks, and the associated rewards, are earned offshore in a low tax jurisdiction, but routine (and often labour-intensive) work is done where ever it is economical. It is generally not economical to have your administrative headquarters in a tax haven, because tax havens have small populations who are often ill-suited to do the administration that the corporation needs. Ex-pats demand big salaries to move to a tax haven. Also, tax havens have small domestic markets and weak infrastructure connections with other countries. Activities, such as sales and manufacturing are unlikely to be done there.
In the long run, lowering the corporate tax rate is (IMHO) likely to encourage companies to base higher value-added activities in Canada relative to other countries. This may not create raw jobs, but it may shift the structure of the job market towards higher value-added jobs and away from menial jobs over time.

[azimuthaviation]

Its nice to see reasonable debate here once in a while, without alot of rhetoric and name calling. Well done gentlemen.

When they threw the trash out, the rats scurried off.

[Shiny Side Up]

Further thinking on this subject.

This biggest problem with Canadian taxation I feel isn't how we determine who gets taxed, although squabbling over it certainly works in the favour of those doing the taxation. The real question is, to use the analogy as given, what is the bartender making? If we were to say that for a hundred bucks each of the ten men is getting one beer, then we're all getting really hosed, and not in the good way. We could keep arguing over what's fair (the analogy misses out some details like what are the men's relation to one another and who actually is getting what) we're forgetting that the bartender is making a crap-load of money off the process. One of the worst expenditures of our tax dollars I feel is how much money it costs us just to run the government, never mind for it to provide us any actual services. While I realise that the government needs to pay well enough so people will want to work for it, the ammount of tax dollars we pay for the services of some of these individuals is enormous. Being a politician in Canada is a pretty sweet gig. No other job requires so little investment in one's education ( and pays so well, and by far has the best retirement plan of all. Nevermind time off and (as been lately outlined by some attack ads on tv) a pretty lax work attendance requirement. Why do we pay for the residents of the PM and the leader of the opposition? Why not like every other Canadian who gets a new job when they get elected they have to shop for a new house? Forget about the Governor General...