Tuesday, April 28, 2009

Tim Hudak misunderstands the word "fair"

Tim Hudak has made a few policy announcements on government subsidies to families. From his announcement:

  • The introduction of a Newborn Savings Account to provide the
    parents of every newborn child with an immediate $1,000 deposit to a
    locked-in, flexible investment plan; and
  • Allowing income splitting for all families with pre-school age
    children, providing parents with the opportunity and the flexibility to
    significantly lower their household tax burden.

I know this will appeal to some of social conservatives who are less concerned with simplifying the tax code or economic efficiency, but I think it's flat-out nonsense, and anyone concerned with economic liberty should, too.

Labeling income splitting as "tax fairness" is absurd. What it is is a complicated subsidy program where people who are not having children or staying at home when they could be working are forced to pay a higher tax rate in order to pay for the lifestyles of others. If this is fair then so are all sorts of tax credits and subsidy schemes for the arts, culture, and green technology that lots of Conservatives oppose.

It is not unfair that a couple is taxed at a different rate than a person making the same amount as their combined incomes. There are costs and benefits to staying at home, and to those who decide to stay at home (or take a less well-paying job), the benefits simply outweigh the costs. They are already staying home for a reason and we don't need to compensate them for their decision.

If you are concerned about tax fairness, flattening the tax system is the way to go. Government shouldn't waste time and money picking winners and losers, whether it's in the economy or in families.

Likewise with handouts for having babies - if you're not the type of people already planning to save for your children when they're born, I'd really rather you do your best to wait until you are before you have them, rather than forcing others to contribute to your government handout.

You know, I wonder how Tim feels about McGuinty's handouts to compensate Ontarians for the increased costs of the HST. Opposing one but not the other seems awfully strange to me.

This is tremendously disappointing to hear coming from Hudak, who I never expected to be this at odds with going into the race.

Cross posted to The Shotgun.

1 comment:

AEK said...

I agree with your analysis completely. I am also disappointed that Hudak is proposing more hand-outs and boutique subsidies to some taxpayers at the expense of others.

How is he going to finance these new handouts? Tax increases or government spending cutbacks? Tell us, Tim!

Why is Hudak playing tax-favouritism instead of tax-fairness?

Mike Harris endorsed Hudak before he came out with these populist policies which are designed to win votes from a large demographic voting block by bribing them with a subsidy, policies which are at odds with sound economic reasoning and fairness. I wonder if Mr. Harris is regretting his endorsement now?

Before Hudak's announcements, I thought he was a 'common sense', tax fairness and conservative candidate. Now I am thinking that he is more interested in votes than good policy.

With these announcements, he has definitely lost my favour as a voter for the next Progressive Conservative Party of Ontario leader.

Can anyone recommend a good conservative candidate for the Ontario PC Party?