I have already received two emails this morning aghast at my notion of increasing the HST by 4 points. Think about this for a minute. I am not calling for a 4 point increase in the HST and that’s it. I am calling for an equal level of decrease in personal income tax. The average person, for example, gets a $3,000 cut in personal income tax and a $3,000 increase in HST paid. Of course, there would need to be safeguards for lower income folks.
I just think that taxing consumption makes more sense than taxing income, profits, savings, etc. Sure the retail industry would grumble but with all due respect retail is the lowest value add of just about any industry. We need to limit taxation on production (by production I mean manufacturing but also services – all activities that are producing something of value that is sold here and abroad) and tax consumption (on products and services mostly produced elsewhere – the value is being generated elsewhere).
I realize that my idea was not practical and no government would ever implement it but I have long felt that you can’t get to any fundamental change in New Brunswick’s economic performance through incrementalism. Slight changes here and there aren’t going to give us a breakthrough.