Current Opinion Across The Dominion
Canada Aroused to Smite Extravagance and Pernicious Taxation
A SIGNIFICANT and rapidly-increasing volume of protest against the menacing and crushing burden of taxation in Canada is appearing throughout the daily and weekly press of the Dominion. The newspapers are aroused primarily because their readers have been aroused—and perhaps a little because the six per cent, sales tax hits consumers of newsprint so unfairly.
The Ottawa Journal heads one of its many protests against super-taxation “The Uprising Against Taxes,” and the Financial Timex ( Montreal) expresses it as “A Revolt Against Taxation.” As the Port Arthur (Ontario) News Chronicle says, “Everybody realizes that the expenses of the country must be met, but everyone is not convinced that the Government has adopted the wisest method,” and other newspapers readily admit that the uprising is not against taxation in general, but the specific, exasperating burden of certain kinds of taxation.
There are three immediate reasons why Canadians are having their attention drawn to the burdens of taxation very definitely at the present time: the imminence of the next session of our Federal Parliament; the announcement that Premier Bracken, of Manitoba, has called in a committee of business and financial experts to help him prune his expenditures; and the sensational announcement by Secretary Mellon, of the United States, to the effect that he is contemplating a very sizeable slash very shortly in taxation levies in the country to the' south of us.
“Faced with a rising tide of public' indignation against super-taxation, the Bracken government in Manitoba,” says the Ottawa Journal, “has abdicated its function and will permit a committee of financial men to examine departmental expenditures, with a view to eliminating waste and curtailing taxes.” This editorial writer draws attention to the fact that such action is a radical departure, and a dangerous one, but points out that “it ought to bring home to governments—Dominion, provincial and municipal— that extravagance must forthwith cease. All our governments have been spending too much money.”
UPHE Regina (Sask.) Post pats the 4 Manitoba government on the back and says that it is “setting a good example which other provinces and the Federal Government cannot too soon begin to emulate. Administration is but one Item on the list of national, provincial and municipal expenditures; but it is in many cases an unnecessarily large one.” The Post views with thorough approval the announcement that the civil service payroll of the province of Manitoba is to be reduced by $500,000.
The Montreal Ginette discusses at some considerable length the Manitoba action. It compliments the Government upon recognizing the seriousness of the situation, and goes on to say:
“It has called on the business interests of the province for counsel and advice, and a committee of representative men from the province at large will be convened to examine the expenditure of every department., with a view to ensuring such economies as will permit of a reduction of taxation. The provincial income tax is especially objected to and it is hoped will be abolished.”
The (¡(nette and a number of other newspapers believe that the chief reason
that extravagant municipal, provincial and federal expenditures have not been curbed hitherto is that “elected members are prone to lose sight of the broader interests entrusted to their care. The getting of something for their constituencies, or for some clamorous interest which they think it necessary to propitiate, overshadows with them the general welfare.” The Winnipeg Tribune sees the handwriting on the wall, and notes that citizens generally are thoroughly roused—if not “riled.” The Tribune asserts :
“What they want is release from a burden of taxation which has become intolerable, and th.ey will vote one party after another out of office until they get it. Premier Bracken and every other political leader in Manitoba can paste it in his hat that the only way to retain office is to reduce taxation, and the only way to reduce taxes is to reduce expenditures.”
The Edmonton (Alta.) Journal prophesies that “the question of taxation will presently be as big a national issue in this country as south of the line.” “It looks at this moment as if, throughout both Canada and the United States, a very positive resistance were about to be asserted,” remarks the Ottawa Journal. This resistance is taking the form of a definite stand against further levies, and in the direction of relief from existing burdens. “The politicians are alarmed, and that is a promising sign,” remarks the Journal.
IN JOT only has Secretary Mellon of the United States announced reduced taxation for an early date, but President Coolidge has issued a strong statement, as the St. Catharines, (Ont.) Standard points out, demanding “immediate retrenchment, and a reduction in taxes.” “This must be taken up in Canada,” insists the Standard. “There is a job right now at Ottawa for statesmen, men of courage and vision.”
The Regina(Sask.) Post remarks that “as long as taxes in this country are double the corresponding taxes in the United States” —referring particularly to the Income Tax—“we might as well close up our immigration and colonization offices and save the money now spent on bringing in settlers who will pass over the line as soon as they have completed their statutory residence in Canada.”
A taxation conference, called by the federal authorities, at which the Federal Government, the nine provincial governments, and municipalities might be represented, has frequently been advocated. As the Ottawa Journal says, “It is the combination of federal, provincial, and municipal taxes which creates the total burden.” The Nelson (B.C.) News comments favorably upon President Coolidge’s action in calling for a taxation conference:
“Our neighbors seem to be on the right track in calling a conference. It may not be possible to formulate measures that will be immediately effective in cutting down taxation, but the circumstance of making a public demonstration concerning the dangerous state of affairs, is bound to have a restraining influence upon those who are involving the country in reckless outlays.”
TP HE fact that these burdensome and ^ annoying super-taxes are hamstringing Canadian industry, and curbing native initiative, is frequently commented upon. The Prince Albert (Sask.) Herald draws attention to the remark recently made by Sir Frederick Williams-Taylor, on
the occasion of the"annual meeting of the Bank of Montreal, when he “pointed out that industry and commerce were unquestionably depressed and discouraged by the imposts demanded by governments. Capital was no longer anxious for ^investment in Canada while these taxes had to be paid.”
“No responsible Canadian Government should allow this question to drift,” contends the Collingwood (Ont.)Enterprise. “Our business world has become exasperated and those who make the wheels whirl are in no frame of mind to sit back and be satisfied with less than a complete revision of our present taxing system.” The Amherst, (N.S.) News notes several discouraging features of the present situation:
“The effect of this taxation is quite plain. It is seen in a frightening of capital for development purposes. It is seen in timid, depressed and retarded industry. It is seen in the cost of living that will not come down. And last and worst of all, it is seen in heightening export figures of the citizenship of this country.”
A. B. Barker, in the Financial Post (Toronto), draws attention to another phase of the situation, namely, the increased burden caused by the tax dodgers, who thus lay a heavier burden upon their more honest—or is it less astute?—fellows :
“In Canada for several years we have had the federal income tax on firms, corporations and individuals, and each year since its inception the machinery for operating the system has grown more ponderous, and consequently more expensive. If everyone was willing to contribute his fair share, much of this would be unnecessary, but human nature is the same everywhere, and there are few who will not dodge if given an opportunity.”
It is generally felt that the income tax might best be left to the Federal Government, and there is general approval of the move in Manitoba to abolish the provincial tax on incomes. The Ottawa Citizen agrees with this, and continues:
“There are too many other federal taxes. The customs tariff is the most burdensome. It is not only unjust in placing the heavier burden on the larger families, but it allows some highlyprivileged interests in Canada also to collect private revenue from the Canadian consumers. Other taxes, like the sales tax, are direct taxation on consumption. They discourage home trade by reducing the purchasing power of'the Canadian people as consumers.”
The Citizen concludes a very able editorial by calling for a conference on taxation, between federal and provincial authorities.
La Patrie (Montreal) believes that the reason business conditions in Canada may not be perhaps quite as favorable as those in United States is because of the hampering action on the part of our federal governments. This leading French-Canadian journal says:
“In England, and even in Australia, there have been appreciable diminutions in the war taxes, and decreases are about to be put into effect in the United States It is obvious, however, that business is not going well in this country, for we are carrying burdens heavier than those borne in United States, who are our nearest and most aggressive rivals in all branches of industry and commerce. The electors can well ask, therefore, that their burden be lightened, and that some other method of paying off the cost of the war be found than in strangling sources of production of the country’s wealth.”
WHEN definite and appreciable relief for-our industries comes, it is anticipated that a considerable flood of capital will be released, to be employed for the upbuilding of the country, at the behest of individual initiative. This point is well brought out by the Vancouver World:
“One of the most beneficial results of a general tax reduction is expected to be the bringing back into industrial and manufacturing use of large individual fortunes now locked up in tax exempt bonds.
“These bonds pay low interest, and are only attractive to individual investors so long as high taxes are in force. Once the taxes are reduced the investor can make more profit by turning his money into active channels, subject to taxation, than he can make by holding on to tax-exempt bonds.
“With the coming of tax reduction these tax-exempt bonds are believed certain to pass into the hands of insurance and trust companies, returning large amounts of individual investors’ money into active business channels.”
The mayor and aldermen of Woodstock (N.B.), by a message sent out to their fellow-citizens in Canada, have been attracting some well-merited attention. The “slogan” that this body of municipal governors proposes is: “The reduction of Canada’s debt by twenty-five per cent, in five years.”
“This idea,” says the Montreal Gazette, “is one that should appeal to the reason of the country, though the achievement is greater than even a strong government would be able to accomplish. The net debt of Canada, after allowing for realizable assets, reaches the great total of $2,414,614,000. The cost of carrying the debt amounts to almost $140,000,000 a year, for interest, sinking fund and expenses of management. It would require payment of $120,000,000 over and above all the ordinary expenditures of the administration to effect the purpose set; and that is beyond the power of the people to provide.”
THE Woodstock message, however, the Gazette readily admits, points to “a duty which parliamentarians and people alike are prone to forget.”
The action of at least one city in Canada, Hamilton (Ont.), in cutting rather radically its municipal expenditures is widely commended. The London (Ont.) Advertiser for one, views it in this light:
“Every governing body in the country should unite to bring us to a point of simple efficiency. We are not a great people numerically, and we should not require as great a system of official looking after as we have right now. If we have been getting too much service, cut it off. If the ball of red tape that binds us together costs too much, then use a smaller ball.
“The country to-day will back any governing body that seeks to do what Hamilton has accomplished, spend less and reduce taxation.”
The St. John (N.B.) Telegraph-Journal takes the occasion to compare its city’s tax rate of $3.00 on the hundred, with several other Canadian municipalities: “Ottawa now pays a tax of $2.80 on the hundred; Toronto a little more than $3.00; London, $3.47; Kingston, $3.60; Brantford, $3.90; Guelph, $3.80; Peterborough, $3.40; Fort William, $3.50; Windsor, $3.60; Kitchener, $3.55; and St. Catharines, $3.90.”
The legislature of British Columbia is usually the first to convene, and Premier Continued from page 26 Oliver’s government has already responded to the demand of two great sections of the people of British Columbia, the farmers and the tradesmen, by bringing down relief in his recent budget. There have been heavy cuts in the farm property and the personal property tax rates. The Kamloops (B.C.) Telegram records the fact that the “farmers naturally are pleased, for with the conditions that have obtained in agriculture during the last few years, the high provincial tax has been beyond their ability to pay, and the tradesmen are more or less placated, being half satisfied with a half cut in the personal property tax which they wanted wholly wiped out.”
Continued on page 30
Certain other suggested taxation changes in British Columbia are commented upon widely by newspapers in the Pacific Coast province. Motorists, for example, have received a fifteen per cent, reduction in their license fees, but the Victoria Colonist points out that “this is more than offset by the three per cent, tax on gasoline which they wall have to pay in future.”
The Colonist goes on to record the fact that “agricultural interests will welcome the reduction of taxes on farm lands and personal property by fifty per cent.,” but regrets that there is “no reduction in the amusement tax, despite the strong arguments that have been put forward, showing the precarious state of the moving picture industry in British Columbia.” The new budget proposal, and the government announcement, leads the Cranbrook (B.C.) Herald to wax both caustic and indignant. This vigorous journal says:
“The government learns that taxes on the sale of jewellery haven’t been paid. Careful watch is being made, ‘also with regard to household furniture, libraries and musical instruments.’
“Could you imagine anything more barbarous, more worthy of a Congo savage, than putting a tax on household furniture, and especially on the sale of musical instruments?
“Why not tax a child two cents every time it says its prayers? Reading a good book, or listening to good music is the next best thing to praying.”
A proposal in Ontario that motor vehicles should, in some way, pay increased taxation is not viewed with any general opposition. As the construction and upkeep of city and country roads has been a particularly heavy burden since motor cars and trucks came into general use, it is felt that they should pay an appreciable share of this increased burden. “Public sentiment,” says the Toronto Daily Star, “is solidly behind Hon. Mr. Henry in his proposal to put a surtax on heavy motor trucks. Destruction on the pavement within the city by heavy trucks has been serious.” The Brockville (Ont.) Recorder and Times believes that “the gasoline tax, if a satisfactory way of collection can be devised, presents itself as a particularly fair tax, because payment will be in accordance with the quantity purchased, which means in accordance with car weight and mileage travelled.”
A fair inference might be, perhaps, -that the Recorder and Times proprietor, the Hon. Geo. P. Graham, minister of railways, patronizes the trains of the Canadian National Railways more extensively than a motor car!
STRANGELY enough, there appears in ^ at-least one daily newspaper of prominence a defence of taxation. A correspondent of an Ottawa paper, quoted by the Peterborough (Ont.) Examiner, touches on a few of the points which might lead one to believe that taxes are actually necessary!
“People complain vigorously against the tax rate of the present day,” remarks the Peterborough Examiner, “but strangely enough, they never compare at the same time the living conditions of 1923 with those of the period when their tax bills were small.” Some of the things mentioned by the Examiner include water, ight, fire protection, police, health, garbage collection, safe drinking, playgrounds, sewage, and an up-to-date finance system. Peterborough points with pride to the fact that “even the residence taps are not metered,” and remarks that in the old days water cost citizens of Peterborough twenty-five cents per barrel.
Why these heavier taxes? The London Advertiser replies because “the tastes of the people are reflected in the tastes of the various governments. We hive bigger ideas than we used to have—we are no longer content to sit in a neat little cottage with our feet on the fender of a bright coal stove.” Thus does that charming bucolic philosopher, A. R. Kennedy, ruminate.
The new six per cent, sales tax, which came very generally into effect January 1, 1924, has met with almost undivided disapproval, on the part of business men and editorial writers alike. The Charlottetown (P.E.I.) Guardian remarks that on January 1, “the federal taxation screw was given another turn,” and many other equally harsh terms are used by daily and weekly newspapers when their gorge rises at this latest impost. The Kingston (Ont.) Standard refers to “the hideous mess of the sales tax,” and the Winnipeg Tribune denounces it as “wholly unwarranted, unnecessary and destructive.” “Before this new tax was imposed,” contends the Hamilton (Ont.) Spectator, “more careful investigation should have been made in regard to the objections raised against the act by the business interests,” and the Brantford (Ont.) Expositor prophesies that this new means of taxation will be a definite “detriment to the business of the country.” The St. Thomas (Ontario) Times-Journal calls the sales tax a “blunder” and “an excessive levy”; the Toronto Mail and Empire feels that it is “taxing trade to death”; and the Toronto Saturday Night stigmatizes it as “the most unpopular tax ever.”
In the opinion of the Toronto Daily Star the tax has “all the penalties of haphazard methods and haste.” The admirable daily conducted by John W. Dafoe, contends that:
“Increasing public burdens by new and ingenious methods of taxation is about as dangerous a business as any government could in these times be engaged in—a fact which, from all accounts, the Dominion Government is more inclined to recognize now than it was a year ago.”
The Sydney (N.S.) Post, The Windsor (Ont.) Star, and many other papers unite with business men in calling upon the government to consider the advisability of imposing a turnover tax, to replace this sales tax.
'T'HE North Vancouver (B.C.) Press touches on this subject of “monkeying with legislation” succinctly and aoly in the following language:
“Out of the confusion that exists one fact at any rate emerges, namely, that this political caper of ‘whipping around the post’ during a session of parliament and tinkering with legislation gravely affecting the general business and industrial interests throughout the Dominion is nothing short of pernicious. The ground work of legislation of this nature ought to be laid in careful investigation and the details ought to be worked out to a nicety by experts before any enactment is placed on the statute book.. There is no time for work of this nature while the House is in session, neither is the average member of parliament qualified to perform the task.
“The business and industrial interests of the country are loyal to the core. They are willing to bear their share of the heavy financial burdens imposed upon Canada by the war, but the confusion created by hasty legislation hampers and embarrasses business interests, which are already more than sufficiently worried in the endeavor to carry on in the face of the difficult conditions that exist in business circles to-day.”
In an outstanding editorial headed “The Burden of Taxation,” the Grain. Growers’ Guide (Winnipeg), expresses the view-point of the prairies and forecasts possible action of the Progressives at the forthcoming Ottawa session:
“The first duty of the Dominion government is to cut down its expenditure drastically, and the Progressives in parliament cannot over-emphasize this demand. The necessary reductions in federal expenditure cannot be made in a day, but many millions can be saved to the taxpayers in the course of a year by business-like measures of economy in governmental administration. In these days when nearly every taxpayer is forced to practise the most rigid economy in his own business and household, the government should be doing likewise instead of imposing new taxes. Expenditures should be reduced all along the line. Every effort should be made to balance the budget and reduce some of the more onerous of the taxes.”