Raising Taxes In Canada

One of the most important topic in economics is taxes, a significant aspect that influences many decisions made by people, firms, and the government. Although it is agreed that action should be taken in order to reduce poverty, raising taxes may not be the most apt way to achieve this. First of all, despite the promise the that government makes about the 2 per cent HST increase being solely used to offset poverty in the province of Ontario, it is difficult to believe that it is completely true. On numerous occasions, the public has seen the government make promises and not abide by them afterwards . If the government has a tighter budget to work with, there is a reduced possibility of a “misuse of fund ”. Similarly, there is high possibility that the 2 per cent increase in taxes will not completely go towards offsetting

The cost of living rises with rising taxes, which might push more people into poverty, defeating the original purpose of raising taxes. Then in addition to increased poverty, this can result in high unemployment rates as well . With higher taxes, the economy slows down as consumers spend less because they have less disposable income. This is particularly true in the case of so-called "luxury" goods, such as high-priced cars, jewelry, and other such goods. Furthermore, it seems pointless to raise the taxes even more, considering that Canada has higher taxes than many other countries. For instance, one of the many countries that has lower taxes that Canada is Germany . Yet, when we compare the child poverty rates between the two countries, Germany has a lower rate, despite the lower taxes . Finally, raising taxes to help reduce poverty might transform into a permanent method of relief. For some, increased support can become a source of dependency because essentially, it’s a form of “free money”, where someone does all the work, and someone else gets a portion of the profit for