Most important guidelines for evaluating tax policy

Question 1

Define

Fairness/equity

Answer 1

The tax system should ensure fair sharing of the tax burden among taxpayers:

• People in similar circumstances should receive the same tax treatment
• All high-income individuals and corporations should pay their fair share of tax
• Similar products should bear the same rate of sales tax

Question 2

Define

Simplicity & compliance

Answer 2

Tax compliance should be made easier by making the system simpler and more readily understood.

Question 3

Define

Balance

Answer 3

Tax reform would redress the too-heavy share of tax revenues raised through the personal income tax, by requiring more of profitable corporations and by broadening the sales tax base.

Question 4

Define

Stability

Answer 4

Stability and dependability of tax revenues are essential for government budgeting. Raising more total tax revenues is not an objective of tax reform, but it should increase the certainty of achieving the revenue goals that the government sets itself.

Question 5

Define

Economic growth

Answer 5

The tax system should encourage growth through lower tax rates on a broader tax base. Business opportunities, rather than tax palanning, should be the driving force behind business decisions.

Question 6

Define

International competitiveness

Answer 6

The tax system should reinforce the ability of Canadians to compete internationally.