My jaw dropped when I came across this story (h/t Jason), which says Liberal finance critic John McCallum says the party is considering the idea of raising the GST back to seven per cent. I mean, seriously John? WTF?
The Liberal party is debating whether it should pledge to reverse the $6-billion cut to the GST made by the Conservatives, as a means of funding broad-based income tax cuts.Allow me to save the party the money it might otherwise spend on focus-testing this stinkbomb: it’s a dumb idea. Stupid with a capital S. Paging anyone with any political antanne? It’s not often I agree with the head of the Canadian Taxpayers Federation, but they’re bang-on here:
John McCallum, the party's finance critic, is understood to have pushed the idea of increasing the federal goods and services tax back to 7%.
…an increase in the GST would be "electoral suicide."
"The Conservatives would have a field day. The Liberal caucus has got to give its head a shake if it is contemplating increasing the most hated tax in Canada," he said.
A field day indeed, I bet Harper and Flanagan are as giddy as little girls at the prospect.
Now, I agree the GST is a more effective tax than income tax, and cutting income tax is a better, fairer course than cutting GST. I agree with Dion’s pledge to cancel the scheduled GST cut from 6 to 5, and putting that money to fighting child poverty instead. That’s a good policy. And I was against the cut from 7 to 6, and posted often on the shortcomings of the Conservative move during the campaign.
But what’s done is done. You can’t roll back the clock. Yes, it was a dumb cut, particularly since the Cons combined it with an income tax increase. But if we couldn’t successfully make that case during the campaign, how in the hell do they think we can make the case for raising the freakin’ thing now? Not a chance. Leave the GST alone. Focus on broad-based tax relief.
This one needs to be nipped in the bud now. McCallum either needs to make clear it was his idea and he’s thought better of it, or Dion needs to distance himself from it, and make clear it’s off the table and was never seriously considered. John is a smart guy, he's done a good job exposing Flaherty's incompetence and developing a good alternate policy on income trusts. But this seems to be a case of the economist needing to come down from the tower.
Things are starting to go better for the LPC these days, or at least go worse for the Cons. Let’s not shoot ourselves in the foot, nay, the head, shall we please? Recommend this Post on Progressive Bloggers