We, 53 economists and public finance analysts, consider the Quebec government’s proposal to reduce personal income tax by some two billion dollars to be inappropriate, unfair and counterproductive.
In order to face the various crises that are currently shaking public services and to accelerate our ecological transition, the State must instead conserve the financial resources at its disposal. These objectives, which guarantee individual and collective well-being, must prevail over the reduction of tax contributions.
Finance Minister Eric Girard has repeatedly reiterated his intention to reduce by one percentage point the tax rate for the first two levels of the tax table (15% and 20%), bringing them respectively to 14% and 19%. For taxpayers, the average tax cut will be $300. For taxpayers earning $100,000 or more, it may reach $810.
2 billion less in the coffers
In a context where the cost of living is rising, such a tax cut may seem attractive. However, the other side of the coin of such a measure is to deprive the public treasury of two billion dollars a year, an amount that the government could use to invest more in public services, particularly in health and education. . The needs are glaring: to resolve the permanent crises experienced in emergency rooms and in community organizations; improve access to mental health care, meet the needs of students in difficulty, create places in childcare services, ensure quality care for seniors; make the essential investments that are long overdue to accelerate the ecological transition. These are the collective priorities that we should give ourselves.
Comparison with Ontario
To justify its proposal, the government asserts that the tax contribution of the Quebec population exceeds that observed in Ontario. This comparison appears to us to be quite incomplete. In fact, by drawing this parallel, we omit to weigh up other essential components of taxation. On the one hand, and this is a well-documented fact, Quebec is much more generous than Ontario when it comes to supporting families.
On the other hand, rates are generally higher in Ontario: hydroelectricity ($750 more per year), daycare centers ($500 more), tuition ($4,500 more), car insurance ($800 more) , etc. A majority of the population will lose out if, in the medium term, the tax cut has to be compensated by an increase in tariffs or by greater recourse to private insurance.
Finally, in the current context of economic uncertainty caused by the very muscular reaction of the Bank of Canada to curb inflation, it seems imprudent to us to give up such large budgetary margins.
In short, faced with the challenges facing Quebec today, faced with the urgency of building a more ecological society and consolidating public services, it seems inappropriate to us to reduce the government’s capacity for intervention and redistribution.
The text is signed by 53 economists and public finance analysts*
*List of signatories
Yves-Marie Abraham, professor, HEC Montreal; François Aubry, economist; Pierre Beaulne, economist; François Bélanger, economist, CSN; Vanessa Bevilacqua, Research Advisor; Érik Bouchard-Boulianne, Economist, CSQ; Pierre-Alexandre Caron, Economist, SFPQ; Lise Côté, Economist, FTQ; Jean Dalcé, economist, CSN; Alain Deneault, professor and essayist; Anyck Dauphin, professor, UQO; François Desrochers, Economist, APTS; Jérôme Dupras, professor, UQO; Francis Fortier, Research Advisor, CSD; Jean-François Gauthier, professor, HEC Montreal; Antoine Genest-Grégoire, economist; Renaud Gignac, economist; Louis Gill, retired professor, UQAM; Fréderic Hanin, professor, Laval University; Pierre-Antoine Harvey, Economist, CSQ; Philippe Hurteau, Economist, APTS; Olivier Jacques, professor, University of Montreal; Mario Jodoin, economist; Vivian Labrie, researcher; Julien Laflamme, economist, CSN; Marie Langevin, professor, UQAM; Raphaël Langevin, economist; Robert Laplante, researcher in economics, IREC; Marc Lavoie, professor emeritus, University of Ottawa; Louise Lavoie, lecturer in economics, UQAM; Joëlle Leclaire, professor, SUNY Buffalo State University; Marie-Hélène Legault, lecturer in economics, UQAM; Samuel-Elie Lesage, Research Advisor, CSD; Julien Mc Donald-Guimond, economist; Sylvie Morel, Associate Professor, Laval University; Keith Newman, Economist; Minh Nguyen, economist; Normand Pépin, sociologist; Mathieu Perron-Dufour, professor, UQO; Éric Pineault, professor, UQAM; André Jr. Robichaud, teacher, Cégep de Victoriaville; Louis-Philippe Rochon, Professor, Laurentian University; Ruth Rose-Lizée, associate professor, UQAM; Jean-Philippe Roy; Innovation Advisor, Quebec Innovation Council; Gabriel Salathé-Beaulieu, economist; Mario Seccareccia, Professor Emeritus, University of Ottawa; Lee Soderstrom, Associate Professor, McGill University; Martin St-Denis, Economist, Coop Interface; Pierre-Guy Sylvestre, Economist, CUPE; Diane-Gabrielle Tremblay, professor, TELUQ University; Simon Tremblay-Pepin, professor, Saint Paul University; Vincent Van Schendel, economist; Nicolas Zorn, President, LAB impact