Singh wants Trudeau to go harder for the rich

Bestinau got that-

The 2022 federal budget includes a pair of tax increases for major banks and insurance companies that will bring in more than $6 billion in revenue and inform high-income earners that they could be next. But NDP leader Jagmeet Singh says he thinks Prime Minister Justin Trudeau should have gone further.

Asked in an interview on CTV’s Question Period whether he thought the actions of targeting the rich were enough, Singh answered no.

“It wouldn’t be what I would have done as Prime Minister, but it’s what we’ve been able to achieve with the Liberal government in power,” Singh said. “We have used our power to make sure some of the richest pay their fair share. But that’s one income stream. We argued for much more than that.”

As part of the Liberal-NDP deal, the two sides agreed to make broad strides in making the tax system fairer, including making “short-term progress on tax changes for financial institutions that have made strong profits during the pandemic. ”

In an effort to help boost revenues to repay Canada’s deficit, federal Liberals are moving forward with a series of measures designed to curb tax avoidance and allow major banks and insurance companies to “help contribute to the recovery.”

The liberals are taking a two-pronged and more aggressive approach than they’ve campaigned for when it comes to forcing major chartered banks and major insurance companies to share their pandemic-generated wealth by raising their corporate taxes.

Wealthy financial institutions are being pressured in two ways:

  • A one-time tax of 15 percent will be levied on taxable income in excess of $1 billion earned by banks and life insurers in the 2021 tax year. This is called the “Canada Recovery Dividend” and the increase will be paid in equal installments over the next five years; and

  • Going forward, the government will permanently increase the corporate tax rate by 1.5 percent on taxable income of banks and insurance companies that exceed $100 million, raising their overall federal corporate tax rate from 15 percent to 16.5 percent.

Together, these policies will bring in $6.1 billion over the next five years, and then the permanent increase is estimated to continue to bring in hundreds of millions in the years to come.

CTV News was the first to report that the budget would be focused on these companies after banks pushed behind the scenes for a change of direction from the government.

Economists and representatives of these major financial institutions have warned that while it may be politically popular to go after banks, the costs could be passed on to bank customers in the form of higher fees unless the government takes steps to ban it.

“Not only is the bank tax a knee-jerk response that sends the wrong message to the global investment community… it is ultimately a tax on you, our shareholders – approximately 70 percent of whom are Canadian. It is a tax on those who directly own our stock or participate through retirement plans or mutual funds, index funds or ETFs [exchange-traded funds]Scotiabank CEO Brian Porter said in a speech to shareholders at the bank’s annual general meeting on Tuesday, according to his prepared remarks.

In addition to chasing banks, the budget also informs high-earning individuals.

After already raising taxes on the richest one percent of Canadians, the budget liberals are warning that some high-income Canadians aren’t paying enough personal income taxes.

“28 percent of filers with gross income over $400,000 pay an average federal PIT [Personal Income Tax] rate of 15 percent or less, which is less than some middle-class Canadians pay,” the budget reads.

As a result, the government says it will “examine a new minimum tax system, which will further ensure that all wealthy Canadians pay their fair share of taxes.”

Singh agrees with this move.

“We think the super-rich aren’t paying their fair share… So we’d do a lot more,” he said.

The NDP has said they want profitable oil companies and large retail stores to be subject to a corporate tax hike as well. Singh has said he will continue to push, opening up the potential for further measures targeting the wealthiest Canadians to be added to the trust and supply agreement between the two parties in the coming years.

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