Jack Layton at a recent NDP rally. (Photo courtesy of jack.ndp.ca)
1. The business community wants stability. It’s a huge reason Canada’s banking system has earned high praise internationally and attracted currency buyers, sending the loonie to record levels and making all of us richer. Increasing the corporate tax rate from 15 percent (what the Conservatives have set it to fall to in 2012) to the NDP-proposed 19.5 percent would be a shock to the system. The world economy is still in precarious condition, as Portugal’s debt woes show, and no one can predict what the ramifications will be from all the other delicate situations in the world (Japan’s recovery, Arab world unrest, fluctuating oil prices). So while the left-leaning Canadian Centre for Policy Alternatives can come out with timely reports declaring corporate tax cuts are poor for job creation and capital investment spending, it hasn’t published a paper saying the business world would take a spike in the corporate tax rate in stride. Jack Layton is taking the public for fools when he tells us he’ll keep corporate taxes here below the U.S. rate, which is 26 percent (although there are all kinds of ways around paying that much). Of course our rate is never going to increase to that level in this decade, and competing with the U.S. rate isn’t the point. Low corporate taxes, combined with a stable economy, will draw more corporations to Canada and retain those that are here. If the Conservatives or Liberals are smart (wishful thinking, I know), they’ll incrementally increase the corporate tax rate once the global economy is healthy. The goal should be to lure lots of big businesses here and then slowly turn up the heat to get as much as we can out of them before they flee to Zug, Switzerland.
2. Layton’s a great attack dog. What would happen if he actually got that bone? Truth is, there’s reason to doubt his ability to lead the nation. Think Barack Obama, without the massive groundswell of support, global goodwill, happenin’ dance moves and cute kids.
Adrian Brijbassi 