Journal des Alternatives

Public services a bargain for Canadians: Study

Canadian Centre for Policy Alternatives , 15 April 2009

The majority of Canadian households enjoy a higher quality of life because the public services their taxes fund come at a solid bargain, according to a new study by the Canadian Centre for Policy Alternatives (CCPA).

Canada’s Quiet Bargain: The Benefits of Public Spending responds to incessant calls for tax cuts and concludes public services make a significant contribution to the majority of Canadians’ standard of living – worth at least 50% of their income.

“What passes for a tax cut debate in Canada is really only half a debate,” says economist Hugh Mackenzie, the study’s co-author and CCPA research associate.

“Our taxes pay for services that are extremely valuable to Canadians. The suggestion we often hear, that taxes are a burden, hides the reality that our taxes fund public services that make Canada’s standard of living among the very best.”

The study shows middle-income Canadian families enjoy public services worth about $41,000 – or 63% of their income. Even households earning $80,000-$90,000 a year enjoy public services benefits equivalent to about half of their income.

The study also shows 80% of Canadians would be better off if the federal government hadn’t cut the GST; 75% would be better off if their provincial governments invested in public services instead of broad-based income tax cuts; and 88% would be better off without federal cuts to capital gains taxes.

“Tax cuts are always made to sound like they’re free money to middle-income Canadians – they are anything but,” says Mackenzie. “We’re far better off with the public services our taxes fund than we are with tax cuts.”

Visit www.policyalternatives.ca or www.growinggap.ca to download the report and calculate the value of your family’s public services.