LILLEY: Trudeau’s plan to tax Canada into prosperity will fail

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If you want a prime example of the Trudeau Liberals’ economic illiteracy, watch their promise to hit Canada’s banks and insurance companies with a punch in Thursday’s budget.

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The Liberals are not promising just one new tax for these businesses, but two.

Nothing like punishing success. Twice.

The Liberals not only promised to raise taxes on some of Canada’s most successful businesses, but they also promised something they called Canada’s recovery dividend which will be paid out of the profits of banks and corporations. country insurance.

This is left populism at its worst. It’s a belief that if we tax the rich just enough, then everyone can be happy. The problem is that the Canadian economy does not have enough wealth or corporations to fulfill the utopian dreams of Justin Trudeau or his new parliamentary partner Jagmeet Singh.

In the last election, the Liberals campaigned to increase the corporate tax paid by Canada’s big banks and insurance companies with a 3% surtax. This would raise the corporate tax rate for these industries from 15% to 18%. On top of that, they promised a vague stimulus dividend from Canada “that these companies would pay in recognition of the fact that they have recovered faster and stronger than many other industries.”

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These measures, which are only vague promises in the last election, were incorporated into the coalition agreement that Trudeau and Singh reached to keep the minority Liberal government in power until 2025.

So was the promise to punish the Canadian insurance industry in another way by taking away some of its business. The outline of the plan to build a national pharmacare program does not appear to include the private sector, unlike Quebec’s existing plan, and will instead create a government bureaucracy to manage prescription drug coverage. This means that just as the government is punishing the insurance industry for its success by imposing additional taxes and “dividends” on it, it will also attempt to legislate to eliminate some of its business.

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Such actions signal to the business community across the country and internationally that Canada is a bad place to do business.

Scotiabank CEO Brian Porter told shareholders on Tuesday that the bank tax idea was “a knee-jerk reaction that sends the wrong message to the global investment community.”

He also rightly pointed out that it would hurt shareholders, many of whom are retirees or people saving for retirement with bank stocks in their pension funds or RRSPs.

“It’s ultimately a tax on you, our shareholders – about 70% of whom are Canadian. It’s a tax on those who own our shares directly or participate in them through pension plans or mutual funds, index funds or ETFs,” Porter said.

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It shouldn’t be shocking that the Liberals are looking to add extra taxes to successful businesses and portraying this as asking those at the top to pay their fair share, they have already done that.

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They ran over the 1% income tax hike in 2015 promising it would offset middle class tax cuts, but they didn’t get enough money out of that tax. They have also campaigned to tax successful investments and impose luxury taxes on boat owners for example.

For the Trudeau Liberals, raising taxes is the key to a better economic future, even though decades of experience show otherwise.

“For a nation to try to impose itself in prosperity is like a man standing in a bucket and trying to lift himself by the handle,” said Sir Winston Churchill.

It seems that Trudeau saw this quote as a challenge rather than a warning.

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