Customs today reports on AIMS’ study, “I’ll Take New England Any Day!”, authored by Mark Milke. The study compares tax regimes in Atlantic Canada with those in New England, our region’s closest geographic competitor, with an eye to improving the Atlantic business environment.. You can read the full study here.

A new report is calling on Atlantic Canada’s provincial governments to adopt the taxation policies of neighbouring New England states.
“Atlantic Canada has struggled for decades with low investment, which leads to high unemployment and net outflows of people,” said Mark Milke, author of Tax Competitiveness: New England and Atlantic Canada Compared. “High tax rates don’t help reverse that.”

Released by the Halifax-based Atlantic Institute for Market Studies (AIMS), the report recommends Atlantic Canadian provincial governments allow for further resource exploration and development, move to a simpler income tax code with emphasis on lowering business taxes and spending restraint.
“There is a practical reason to allow natural gas development — extra royalties and extra business taxes that then can be used to reduce overall high business and personal tax rates in the region,” said Milke. “It’s hard to lower Atlantic Canada’s taxes without a new revenue stream, unless one wants deep cuts to program spending.”

Lower taxes and natural resource development will create a much better economic environment, he added.
“Atlantic Canada has been a high tax jurisdiction since at least the 1970s,” said Milke. “Lower taxes and smart investment policy is why Alberta has thrived for decades despite occasional bumps like now.”

According to the study, the lowest top marginal personal income tax rate in New England in 2016 is New Hampshire’s, at 39.6 per cent, compared with a top marginal rate of 54 per cent in Nova Scotia.

Read the full article.