The National Post is consistent in its criticism of the “usual outrage” of people who still believe in public healthcare. In today’s editorial they normalize marketized solutions to the healthcare crisis. Then they blame universalists for wanting to create misery. There is one glaring problem with their editorial line, though:
Change will come. Governments can help facilitate it, or continue to enforce delays to everyone’s detriment.
Neoliberal governments have done more than facilitate it, they have caused it.
Thirty years of continental, national and provincial neoliberalism, particularly in tax cuts and privatization, have defunded governments’ ability to fund healthcare properly.
Then in proper Shock Doctrine style, the right wing media asserts the crisis, calls on the market to solve it, then criticizes people who think it’s a human right for all to have the best healthcare possible as stodgy.
Then they use rhetorical spin to make it sound like government policy is to perpetuate delays: “continue to enforce delays to everyone’s detriment.”
All the media has to do is neglect to mention the massive tax cuts, largely to the rich, that have created the problem in the first place.
It’s called the Shock Doctrine. Naomi Klein wrote about it. Gordon Campbell worships it with his golden straightjacket fiscal knives, and even after he “resigned” he will steer that policy until the very last day he is in charge.
Does not include the 15% personal tax cut the BC Liberals announced last night.
BC is truly becoming a Caribbean tax haven for corporations and the rich. From 1999-2008,
the number of corporations paying no income tax in BC is over 5 times higher
the number of people making $100-200k/year yet paying no income tax is over 8 times higher
the number of people making over $200k/year yet paying no income tax is almost 3 times higher.
A few weeks ago I wrote about how the BC government’s new financial documents show a history of intense tax cuts in the last decade. Based on information I received this week from a freedom of information request to the Ministry of Finance, we can explore how the BC Liberals are intentionally defunding the government through tax cuts, which starves public services and motivates privatization and a whole host of other socio-political diseases.
Further, you’d think that with such massive tax cuts, businesses would be able to afford an increase in the minimum wage at least once in the last nine years. I guess not.
Corporations Paying No Taxes
Here is the 10-year breakdown of “corporations with a permanent establishment in BC that filed tax returns and paid no BC Corporate Income Tax”:
Year
Corporate
Tax Rate
Number
of Corporations with over $500k in Revenue Paying No Tax
1999
16.5%
<50
2000
16.5%
61
2001
16.5%
96
2002
13.5%
115
2003
13.5%
116
2004
13.5%
165
2005
12%
169
2006
12%
199
2007
12%
254
2008
11%
266
2009
11%
No data
2010
10.5%
2011
10%
2012
10%
39% Decline
Increased by over 430%
What do we learn here?
From less than 50 in 1999 to 266 in 2008, we see a more than fivefold increase in the number of corporations paying no tax. While their taxes will decline by 39% from 1999 to 2011, that drop does not cause the increase in the number of corporations paying no tax since there are many variables that lead to tax freedom. But, gosh, does it sure correlate strongly in describing a defunding tax regime.
Small Businesses Paying No Taxes
Here is the 10-year small business breakdown of “corporations with a permanent establishment in BC that filed tax returns and paid no BC Corporate Income Tax”:
Year
Small
Business Revenue Ceiling
Small
Business Tax Rate
Number
of Small Businesses with under $300k in Revenue Paying No Tax
Number
of Small Businesses with $300-400k in Revenue Paying No Tax
Number
of Small Businesses with $400-500k in Revenue Paying No Tax
1999
8.5%
135,165
<50
<50
2000
4.75%
125,450
<50
<50
2001
4.5%
134,820
<50
<50
2002
$300,000
4.5%
137,246
<50
<50
2003
$300,000
4.5%
144,400
53
<50
2004
$300,000
4.5%
145,424
<50
<50
2005
$400,000
4.5%
147,852
68
<50
2006
$400,000
4.5%
147,295
98
<50
2007
$400,000
4.5%
152,826
147
51
2008
$400,000
2.5%
140,947
133
67
2009
$400,000
2.5%
No data
No data
No data
2010
$500,000
2.5%
2011
$500,000
2.5%
2012
$500,000
0%
All of them
All of them
All of them
100% Decline
Increased by over 160%
Increased by over 33%
What do we learn here?
We learn that the backdoor tax cut in 2005 when the government increased the small business ceiling from $300,000 to $400,000 meant a great deal of businesses dropped from a 12% tax rate to a 4.5% tax rate that year, which while not causing the rise in the number of corporations paying no tax, it reinforced the defunding priority.
Not only will corporations with revenues below the new $500,000 small business ceiling pay no income taxes in BC in 14 months, but larger businesses will pay no taxes on the first half million in revenue. Look out, Cayman Islands!
But in 2012 it will be clear that a 0% tax rate will then actually cause all businesses earning less than half a million dollars to pay no taxes.
Sitting through Gordon Campbell’s condescending TV address last night was a flashback to the idiotic campaigning they did to get elected in 2001: tax cuts along with service improvements. That’s inherently contradictory, but people bought it. And they’ve bought it twice more this decade despite the carnage the BC Liberals have visited upon us all. How can we be so foolish? It’s because “we” have been socialized into this way of crazy thinking. How else would we explain why people vote for tax cuts when anyone who can balance their own chequebook can see that a decline in income leads to a decline in spending.
But we also learn that well over 100,000 businesses pay no tax. In discussing this very high number with a BC Finance Ministry official, it became clear that many of these are businesses set up that are designed to earn no money to be write-offs for people, so the sheer size and flux in that number is of little significance for my purposes here.
Individuals Paying No Taxes
“Individuals who filed a BC tax return and paid no BC Personal Income Tax.”
Year
Tax Cut
Number
of Individuals under $100k in Income Paying No Tax
Number
of Individuals with $100-200k in Income Paying No Tax
Number
of Individuals with over $200k in Income Paying No Tax
1999
952,756
92
58
2000
993,427
128
58
2001
25%
1,070,020
139
56
2002
1,130,013
201
65
2003
1,144,123
269
97
2004
1,148,479
280
68
2005
1,398,577
325
74
2006
1,380,328
491
124
2007
10%
1,360,101
690
176
2008
5%
1,414,854
776
169
2009
No data
No data
No data
2010
2011
15%
Increased by almost 50%
Increased by over 740%
Increased by over 190%
What do we learn here?
We learn that it’s harder to criticize the government for massive tax cuts for the rich and for corporations when they increase the number of poor people who pay no taxes, which is what the 3rd column describes. Shockingly, this is even true in a province where the government has chosen to not increase the minimum wage in over 10 years.
We also know that massive tax cuts have been matched with clawbacks through MSP increases and a decline in services for the poor, so in the end, there is no real gain for those in poverty.
So if you’re fine with corporations paying no income tax, for whatever reason, you ought to be quite thrilled right about now, even more so in 2012. But if these facts disturb you, it’s time to find ways of changing the culture shift that has brainwashed enough people so that the premier can feel confident getting on TV when his approval rating is 9%, then pander to these core instincts with tax cut rhetoric as if it were 2001 again and people have forgotten the real cost of tax cuts.
If you would like the raw spreadsheet file with all these numbers, just email me and I’ll send it along.
De-Spinning the Political and Re-Spinning it for Social, Economic and Political Justice
