A lower rate and a broader base
Article Abstract:
Canada's proposed Goods and Services Tax (GST), which is scheduled to take effect January 1, 1991, will replace the current federal Manufacturer's Sales Tax (MST) and the Tax on Telecommunications. The GST was originally proposed to be nine percent, but the Economic Council of Canada (EEC) analyzed the results of the GST on the economy and reported that, while the GST would make the tax system more efficient, a nine percent increase would create an unacceptable one-time rise in inflation of 2.7%. The ECC recommended decreasing the GST to seven percent to ameliorate the negative results of the transitional phase on trade terms while retaining the favorable results on trade. The recommendation was adopted by the government, which will make up anticipated shortfalls in revenue from the elimination of MST through spending cuts and increases in corporate, personal and excise taxes.
Publication Name: Au Courant
Subject: Business, international
ISSN: 0226-224X
Year: 1990
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New look at corporate taxation
Article Abstract:
In a speech before the Economic Council of Canada, Arnold Harberger, an economics professor from the University of Chicago, theorized that most corporations pass their tax burdens: 1. on to consumers by raising prices, 2. backward to shareholders and other capital investors, or 3. over to workers, in the form of reduced salaries. Of these three options, the third is chosen most frequently, according to Harberger. Alan Auerbach, a University of Pennsylvania economics professor, also addressed the Council. He suggested that corporate taxes be reformed or eliminated after citing the declining percentage of U.S. revenues from corporate tax receipts.
Publication Name: Au Courant
Subject: Business, international
ISSN: 0226-224X
Year: 1984
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