The BC government delivers its budget next week, and has indicated that more tax cuts will be coming. But what does that mean in terms of tax fairness? Or for what we, as a society, are able to accomplish together?
Today researchers Iglika Ivanova and Alex Hemingway released an analysis showing that tax cuts have disproportionately benefitted the richest 1% of British Columbians. The rest of us have saved very little – and are being squeezed by growing affordability crises because of a lack of public investment in key services.
Our post today shows that if the wealthiest 1% of BC households paid the same tax rate today as they did in the year 2000, they would be contributing, on average, almost $39,000 more to the public treasury. It’s clear that tax changes since 2000 have produced a system that is much less fair.
If the forgone revenue from these tax cuts was instead invested in services—affordable housing, $10-a-day child care, seniors’ care, and lower tuition fees—it would yield substantial gains for most families. Instead, the BC government has chosen to have these dollars flow almost entirely into the pockets of upper-income British Columbians, with the richest few benefitting most of all. Read more in our post here or watch the panel discussion on policy and taxes that Alex recently joined (balancing out the Canadian Taxpayers’ Federation’s Jordan Bateman).
BC is also still failing to invest in a poverty reduction plan, which would actually save money while alleviating hardships for the 13.2% of British Columbians who live below the poverty line. Poverty costs BC at least $8 billion per year in health services, strains on the justice system, and in foregone economic activity. To draw attention to this urgent need, a number of social justice organizations are organizing events for a Poverty Free BC Action Week, which will culminate in a rally in Vancouver on March 4th.
Instead of tax cuts, austerity, and blind faith in harmful, extractive industries, BC needs to transition toward a much more secure, sustainable economy.
As the BC budget announcement approaches—to be followed in a few months by the provincial election—we’ll keep looking for achievable long-term solutions that put social, environmental and economic justice first.