Officials from the Department of Finance spared no effort to explain to what extent the Quebec taxpayer is crushed by a tax burden that makes him the mule of the West.
The tables and graphs included in the documents appended to the budget attempt to demonstrate not only that Quebec is the Canadian province where personal income tax is the highest in relation to GDP, but also that it is an ogre tax compared to the advanced economies of the OECD. However, we have been careful not to make a specific comparison with the Scandinavian countries, where the concern for social justice is the most developed.
Regardless, the Legault government is determined to relieve the mule. In his budget speech, the Minister of Finance, Eric Girard, said he was proud to announce “the largest tax cuts in the history of Quebec”.
Through an ingenious combination of income brackets ranging from $20,000 to $98,000, we are shown that, contrary to what we have always believed, income tax is less progressive in Quebec than in Ontario, if we consider both federal and provincial taxation.
Lowering taxes is the easiest thing for a government to do. The question is whether it was the responsible thing to do, in addition to following through on the CAQ’s election promise.
Nowhere in the budget documents has an attempt been made to assess the benefits that Quebec taxpayers derive from the additional amount they pay to the government, whether for subsidized daycare, drug insurance, tuition, which ultimately means that his after-tax disposable income compares favorably with that of his Ontario counterpart. Even more so if you take into account the cost of living.
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That this tax cut does not improve the lot of the 2 million Quebecers who do not have the means to pay does not trouble the Minister of Finance. It’s a question of balance, he explains, the poorest having had their turn last year. In their case, reducing the wealth gap seems less of a priority. He compares his role to that of a bank treasurer and the poor generally do not have a bank account.
Of course, the $9.2 billion that the tax cuts will total over a five-year period will not affect the state’s ability to intervene, since they will be taken from the Generations Fund. “At no time or in any way will the decline be at the expense of public services in Quebec,” assured Mr. Girard.
To those who are worried about the debt that future generations will have to assume, the Minister replies that payments to the Generations Fund will simply experience “more moderate growth”. It is the same response that Ottawa gives to the provinces when they complain that the Canada health transfer is not increasing at a sufficient rate.
Like Mr. Girard, we can very well be of the opinion that it is not dramatic to postpone the achievement of the debt reduction objectives for a few years, but we could have chosen to invest these billion in public services, solving the housing crisis or even the fight against climate change.
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For the first time in ages, the budget speech did not make the slightest allusion to federal transfers, while the Trudeau government has just dealt a real slap in the face to Quebec — as to the other provinces — in the negotiations on the Canada Transfer in health (TCS).
The Minister of Finance included in his budget forecasts the additional billion that he received without making a fuss. At most he murmured at a press conference that it was a “modest sum”.
We can understand that the Legault government does not want to dwell on this bitter failure, but Quebecers will nonetheless pay the price. Thanks to the additional revenue that inflation has generated, federal stinginess has not prevented forecasting an increase in the health budget of around 7.7% in 2023-2024, but this will fall to 2.1% the following year, when Christian Dubé was already struggling to deploy his plan to “refound” the network. Unfortunately, there will no longer be time to dip into the Generations Fund.