Key issues in the General Election of 2011 - Number 2

Recently, I was making a purchase at a store, but when the merchant saw the wedding band on my finger, I was told that for you married people the GST is 7%. Well, I asked, what if I was single? The answer was 9%, unless I have a kid under 18 years of age, then it's 8%.

How can this be, I demanded.

I was told that, depending on my marital status (and a child is considered an equivalent to a spouse), different rates of tax apply.

Then the merchant spotted my car (not a beater with a heater, but it gets good mileage), and he announced that with a car like that, there is a surcharge of 3%.

What!? How can you do THAT, I asked (glad that I left the BMW at home).

The merchant told me that because I make enough money to afford such a nice car, I have to pay more tax. But, the merchant offered, if I can prove that I'm are a senior, the rate would be 5% with no surcharge...

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You get the picture, (and of course I made that whole story up), however;

The GST and the PST, they are fixed at a flat rate, no matter your circumstances.

The same is not true of direct taxation (a.k.a. income tax - more on this later)

The current tax regime uses what is known as 'progressive' tax rates, and it means that if you make more money you pay a higher percentage of your income to direct taxes.

How can this be anything but unfair? Legal, perhaps, but surely not fair.

The 2 parties with elected MLA's, the Saskatchewan Party and the New Democratic Party, Sask. Section, are in a bidding war right now (the Saskatchewan Liberal Association is also participating, as is the Green Party of Saskatchewan, hard to tell with the Progressive Conservative Party of Saskatchewan), offering various exemptions to taxation, depending on your circumstances. This is not considered 'buying' your vote. No, not at all, it's just standard electioneering.

There is one sure way to make this bidding stop, and that is a flat tax, with no exemptions.

Everybody pays the same rate, and the tax return consists of a single page. Same holds true for businesses.

One tax rate, no exemptions, everyone contributes the same percentage of their income.

Alberta does it, as do many countries around the world.

And as an added bonus, there is no point in you lobbying the government for special tax treatment for your industry, as there are no exemptions.

Three years ago, the Fraser Institute published a research study on the flat tax system. A bit long but definitely worth a read.

The Western Independence Party of Saskatchewan (W.I.P.) supports a flat tax, but there is no chance the other parties (nor the media) will even want the issue raised in this election. Wouldn't it be awesome if I was wrong about that?

Perhaps if the electorate demanded the other parties address the issue, it might be brought up by the media, but if no one speaks up, it will not happen.

And that income tax (a.k.a. direct taxation) I mentioned above? The Constitution Act reserves that to the Provinces in the section titled: Exclusive Powers of Provincial Legislatures. Section 92(1) is the only place that "Direct Taxation" appears in the Constitution. And Saskatchewan doesn't even collect it itself (unlike Quebec) but rather allows the Canada Revenue Agency to do the collecting.

Don't take my word for it, go look it up.

Election issue? Not unless you the voters make it one.