Chapter 4

http://timestranscript.canadaeast.com/news/article/529923

Summery

The article discusses a survey discussing whether New Brunswick should switch to a flat tax rate system instead of the progressive system it has now. It would attract new workers, as they would have to pay less tax and take home more money. But many are rejecting the idea because they believe those that earn more should pay more. Many that agree with the flat tax plan say that worker with a higher income still pay more tax even on the flat tax plan since 10% of $100,000 is more than 10% of $10,000. Not surprising that most people like the idea of paying less tax and having more money in their pocket to spend whatever way they like.

Connection

Chapter 4 talks about the tax brackets in Canada and the different taxing ways there are. Canada currently uses Progressive taxation. So the percentage of taxes paid is different among different incomes. The higher the income is, the higher the percent of tax one would have to pay. A lot of people do not think that’s fair due to the tax bracket and the marginal tax. One that makes more money doesn’t necessary get to take home more money, as most of the money would be paid off in taxes. A lot of people in New Brunswick are debating the idea of a Flat tax, which means there is a fixed percentage of tax one would have to pay. It challenges the current progressive taxation ways and makes people think about future taxation plans.

Reflection

This is a bit of a debate for myself. On one hand, I don’t like the current progressive taxation in Canada. I think it discourages people to take better positions and higher income because in the end, the raise isn’t all that much. If we were to have a flat taxation plan, the rich would still pay more than the poor. It would encourage people to take higher incomes and not worry about the money going to tax. It also avoids the tax bracket, which is a problem with the progressive taxation plan due to the fact that some people are just on the boarder and paying more but not earning quiet as much. The problem with the flat taxation is that there would be less tax going to the government and many benefits that we have now would be lost. This is especially troubling for the poor as they are the ones that are benefiting the most from all the public services. It is defiantly not an easy debate.