When is a tax not a tax? When it’s a Liberal raising the tax, apparently.
For the past two weeks, newly minted Conservative Leader Pierre Poilievre has been asking the Trudeau Liberal government to halt planned tax hikes due to the rising cost of living. The government has not only refused, they’ve at times denied that raising premiums on employment insurance or the Canada Pension Plan amounts to a tax hike.
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Yet when Justin Trudeau was opposition leader, he demanded to know why then Prime Minister Stephen Harper was increasing payroll taxes with an EI premium hike.
“I want to ask the prime minister a question I received from Dustin in Calgary,” Trudeau said in the House of Commons in June 2013.
“His question is specifically about his EI premiums, which are rising by $50 this year, a direct payroll tax increase. Dustin would like to know why did the prime minister choose to raise EI premiums for him and every other working Canadian?”
In 2013, Liberal Leader @JustinTrudeau wanted to know why the Harper Conservatives were raising EI premiums, "a direct payroll tax increase."— Brian Lilley (@brianlilley) September 28, 2022
Seems things have changed and the Liberals don't see it as a payroll tax anymore. The key part of this clip is around the 23 second mark. pic.twitter.com/ihU4QRu9aM
Seems that an EI premium hike was a payroll tax increase in 2013 but it isn’t now, at least not to Liberals.
One of the arguments from those who falsely claim that EI and CPP premiums are not payroll taxes is that they provide a direct benefit to Canadians. That makes no difference — they are charges levied by government to fund government programs and are by definition a tax.
There is also the issue that both EI and CPP are paid for by workers and employers. The employer gets no direct benefit from paying these premiums but is still required to pay them for each employee, as a payroll tax.
EI and CPP, whatever their benefits, are both payroll taxes and will rise for employees and employers come Jan. 1. It doesn’t matter how the Liberals spin it, they are raising taxes on working Canadians on New Year’s Day.
Liberals vote to triple carbon tax
Three months later they will raise taxes again when the automatic annual tax increase on alcohol takes effect on April 1, the same day the carbon tax is set to rise.
On Wednesday, the House of Commons voted down a Conservative motion which read: “That, in the opinion of the House, given that the government’s tax increases on gas, home heating and, indirectly, groceries will fuel inflation, and that the Parliamentary Budget Officer reported the carbon tax costs 60% of households more than they get back, the government must eliminate its plan to triple the carbon tax.”
The Liberals, NDP and Bloc all voted against the motion, leading Poilievre to quickly claim that the Trudeau-Singh coalition voted to triple taxes on gas, heat and groceries while he and the Conservatives voted to cut taxes. Given the high cost of living, this is a message that will resonate with Canadians and it’s a message Trudeau’s Liberals will have a hard time refuting.
A poll out Thursday from the Angus Reid Institute found that 88% of Canadians now say they’ve had to cut back on spending in one form or another to deal with inflation. Nearly half of Canadians say they are worse off financially than they were a year ago.
Another poll out this week from Ipsos showed that affordability is the top issue for Canadians, with 40% saying it will affect their vote in the next election compared to just 19% citing climate change. Canadians may care about climate change, but right now they are more concerned with putting food on the table with a tightening budget.
Telling voters concerned with the rising cost of living that a tax is good for them, or that you aren’t really raises taxes anyway, isn’t a winning strategy. Trudeau is sounding tone deaf on this file and could be in trouble with voters shortly.