The Canadian Taxpayers’ Federation, a country-wide not-for-profit, made up of indiscriminate members, recently published their submission to the Government of P.E.I. for the 2021-22 provincial budget. Included in its recommendations are broad tax reforms for individuals and corporations, and, most alarmingly, a sweeping reduction of 15 per cent of all provincial public sector workers’ wages.
The CTF’s position on public sector wages is disrespectful to the hard-working Islanders who have been on the frontline of the pandemic since March 2020. Referring to public sector workers as “bureaucrats” is dismissive of the many, many types of frontline workers under CUPE. What is more, all government workers are also taxpayers, and they would much prefer a wage increase to a personal income tax cut as a way to stimulate the local economy. It is also a potentially dangerous proposal. Workers’ salaries are negotiated between unions and the government. Is the CTF suggesting the government should legislate a wage decrease? That could create untold labour unrest.
Not only are the CTF’s recommendations lacking in any specifics on this proposal and seem clueless about how the tax system works, but they would also heavily benefit those with higher incomes while hundreds of thousands of middle and low-income Islanders wouldn't receive a cent from the federation's proposals. Those who do not need the money would receive the most, while those who most need it would not receive anything. For example:
• Those with incomes over $250,000 would get a tax break of over $8,857 a year from the taxpayers federation proposal, representing 2 per cent of their income.
• Islanders with income of $25,000 or less would get an average tax break of no more than $97 annually, about a quarter a day.
• Over 32,490 Islanders, mostly all lower income earners in the province, and more than a quarter of all P.E.I. tax filers, wouldn't receive a single cent from the CTF proposal, as they don't have net tax payable to the province.
This would continue the trend unearthed during the pandemic: that the wealthy continue to get richer, while workers are bearing the economic consequences of the continuing crisis. Also, the CTF’s proposal to privatize golf courses on the Island is short-sighted. Recently, the privatized Mactaquac golf course in New Brunswick was returned to government-ownership because the private owner could not turn a profit.
This regressive budget submission from the CTF would negatively impact workers and the province as a whole. All major economists agree that public investments in all sectors are what is needed to recover from the pandemic. P.E.I. is on the right path for a robust economic recovery and the government should not be distracted by these harmful recommendations.
Leonard Gallant, President, CUPE P.E.I.
Gabrielle Ross-Marquette, CUPE researcher
Toby Sanger, director, Canadians for Tax Fairness
Calculations by Canadians for Tax Fairness, using Income tax statistics for P.E.I. published by the Canada Revenue Agency.
