Higher Taxes for the Rich

There are two schools of thought regarding tax cuts for the rich. The first is that they should be decreased. This has the potential to leave more money in the pockets of businesses so that they can invest the money saved in creating new jobs and promoting research. On the other hand others claim that raising taxes will help raise tax revenue for social welfare programs like health and education while also targeting those that have the most. This paper will argue that the second option- tax increases for the rich, is the best option.

Higher taxes for the rich are advisable because corporate tax cuts are one of the least efficient methods of job creation (National Office, 2011). It is better to invest in infrastructure. Past tax cuts have also not spurred investment levels higher. Given that Canada has a deficit this means corporate tax cuts are subsidized by the tax payers. Keeping corporate taxes at their current level or even raising them can also effectively keep tax revenue from shifting from Canada to the United States (National Office, 2009). If Canada did raise taxes this would be similar to action taken in Greece where taxes have been raised to keep the deficit from spiraling out of control (Dow Jones, 2009). Hungary has also recently raised "crisis taxes" which are not permanent but show how they can be used to raise money needed for the economy (Dow Jones, 2010). As well tax cuts are not

advisable because they tend to disadvantage women. According to Chen and Mintz (2008) it is important that Canada lower the tax burden which it imposes on businesses due to the fact it ranks 11th out of 80 in terms of corporate tax burden.not a good economic strategy in the long run (Ashworth and Heyndels. not all reductions should be uniform as certain industries like manufacturing pay too little in relation to services which pay too much. 2010). 2011). Hungary for instance has raised taxes recently in order to meet the challenges of the modern economy. Canada can remain competitive with . 2000). and others who need help (Hasson. Though criticized as regressive this may add an element of fairness to the tax system (Cleveland. Another reason why taxes are commonly lowered is so politicians can win favour with voters. Given the present difficult economic times it is crucial that upper class and corporate taxes are raised. 2011). 2010). is restoring property taxes. One of the best options for raising taxes for the rich. Lower taxes do not stimulate the economy but instead contribute to the growing gap between the rich and the poor. children. Other countries which have lowered taxes includes the UK where recently it has been announced that the corporate tax rate would be cut to 23 percent by 2014 from 28 percent (Dow Jones Deutschland. Rather than helping the economy tax cuts are at the root of the financial problems in Europe and as well have contributed to growing inequality (Stancil. rather than income taxes. However.

Greece 2010 Draft Budget Cuts Spending. Europe's Voodoo Economics.other nations without lower taxes and must do so if social services are to be maintained. Dow Jones. May 11. References Ashworth. Canadian corporate tax cuts hand $406 billion to U. . J. (2009). (2000). Mar/April(293). 290(25). treasury: study. National Office. National Office. B. (2010). 22(1). Raises Taxes. (2010). Public Choice. Canadian Center for Policy Alternatives.cacan (TT) Cleveland. Five Economic Reasons to Say No to More Corporate Tax Cuts. March 23. The Nation. (2011). J. Who Stands to Lose from Tax Cuts in Israel? Canadian Journal of Women and the Law. Hungary PM to Hold Talks In '12 With Tax-Affected Sectors. Dow Jones. Dollars and Sense. (2011). April(103) Chen. (2008). Dow Jones. D. and Mintz. J. UK to Deepen and Speed Cuts in Corporate Taxes.S. Hasson. P. Nov 11. Restore the Original Wealth Tax. Dow Jones. and Heyndels. Still a Wallflower: The 2008 Report on Canada's International Tax Competitiveness. CD Howe Institute. Stancil. (2010). Politicians' Opinions on Tax Reform. Dow Jones. Y. (2011). Dow Jones. Canadian Center for Policy Alternatives. (2009).