B.C. unveils tax-cut budget

http://www.canada.com/nationalpost/financialpost/story.html?id=55246e93-c30e-48e1-aaaa-52900496437d&rfp=dta


Summary
British Columbia unveiled a $36.2 billion budget on Tuesday that includes a 10% personal income tax cut, which the government said was aimed at easing housing problems caused partly by the western Canadian province's strong economy. Provincial officials said British Columbia had a real GDP growth of 3.9% in 2006, but forecast it to slow to 3.1% percent in 2007 and 3% in 2008. Total debt, including that of provincially owned corporations, is expected to be $36.8 billion, up from $34.3 billion last year. The tax supported debt-to-GDP ratio is projected to be 14.8%, down from the 15.8% projected in last year's budget. The right-of-center B.C.Liberal Party government of Premier Gordon Campbell has been accusing of cutting social programs in past years as it emphasized fiscal constraint and tax relief, which it said were needed to rebuild the province's economy -- which is now booming.


Relation to Chapter 4
After learning this chapter we knew that Canada has a federal government system. Different government levels collect taxes from citizens. We noticed that the largest component of government spending is social services, which including old age security, the child tax benefit program, employment insurance, social welfare assistance programs etc. The second largest expenditure for the federal government is debt charge. The personal income tax accounts for about 46 percent of federal-government revenue. The significance cut of persona l income is a really good thing for citizens or there is treat behind it? From a positive point of view, we can see clearly once when the personal income tax cut starts, every individual citizens will have 10 more percent of income every year. With this 10 percent on hand, they are free to do whatever they wanna for personal. Let's turn to a greater point of view, since government's revenue will decrease, so they tend to cut of budgets on some projects which limits our ability to invest in the social and economic infrastructure that has historically been the heart and soul of Canada, making ours one of the most desirable countries in the world in which to live.
So there are both views of the cuts of personal income tax.


Personal ideas
In my point of view, the cut of personal income tax is not a good strategy to generate the gap of income in Canada. Taxes in Canada have already been cut deeply compare to the other high-income OECD countries. Canada's tax revenue as a percentage of GDP is already well below the average. They show that high-tax countries have had greater success at achieving their social objectives--without economic penalty. And from many other countries' example, we learn that tax cut is not a good idea to helping the growing economic. So we should say "no more" to tax cuts that benefit wealthy Canadians at the expense of the economic security and well-being of all Canadians.