FREDERICTON – As a legislative committee begins today the process of canvassing citizens on the government’s proposed tax reforms, the nation’s eyes are on New Brunswick.
According to experts and policy watchers, it was inevitable that the ground-breaking taxation proposals unveiled this month would generate such rapt attention.
“For the longest time, Atlantic Canada was on the losing end of the proposition,” said Charles Cirtwill, executive vice-president of the Atlantic Institute for Market Studies. “They’re talking about going from last to first in terms of the level of taxation, the amount of money they leave in the pocket of the worker, the investor. That really is revolutionary.”
The first of a series of nine scheduled public meetings on Finance Minister Victor Boudreau’s discussion paper will be held in Edmundston today. Meetings will run as long as needed and more can be added as demand requires, according to Supply and Services Minister Roly MacIntyre, who is chairing the committee.
Ideas outlined in the discussion paper involve a fundamental rebalancing of the tax system, tilting toward consumption taxes – including a two-percentage-point rise in the Harmonized Sales Tax and a carbon tax – and restructuring the income-tax system by moving to a 10-per-cent flat tax by 2012.
Large businesses also stand to gain under various proposals that could see their corporate taxes fall from 13 per cent to as low as five per cent, which would be the lowest rate in Canada.
These proposals stand to make New Brunswick more attractive on a global scale, Cirtwill said.
“Other jurisdictions are really starting to take notice,” he said.
John Williamson of the Canadian Taxpayers Federation said the discussion paper has national implications, noting that the government has generated a number of bold proposals that could bring enormous financial benefits to the province.
“It’s so unusual for a government to throw so many ideas out which think- tanks and policy makers regard as being sound public policy,” Williamson said. “They have the policy prescription correct.”
The discussion could prompt other regions in Canada to launch their own taxation reviews, he added.
But as the country watches, interest seems to be waning in some areas of the province. Of the more than five dozen individuals or groups who have registered to take part in the public meetings, the vast majority are in Moncton and Fredericton, officials said. Expressions of interest have been dramatically lower in the province’s north.
“We have some concerns up north,” MacIntyre said. “We’d like to see more participation.”
MacIntyre acknowledged that some of the ideas in the discussion paper, such as the carbon tax and the HST hike, are highly controversial. But it is important to talk about them, he said.
“We’re saying if you have a better idea, we’re willing to listen,” MacIntyre said. “That’s why we’re going out on the road. We want to hear what people think.”
Opposition Leader Jeannot Volpé, however, lashed out at the government for setting up the consultations in the middle of the summer, when many families are away and unable to take part.
“There’s better times in the year for that type of consultation,” Volpé said, adding that certain proposals, including the carbon tax, stand to hurt low-income earners and require critical analysis. “What’s the rush?”
In addition to today’s meeting in Edmundston, sessions are scheduled this week in Campbellton, Bathurst, Caraquet and Miramichi. The process will be on hold during the Canada Day week and resume the following week, with meetings in Moncton, Saint John, Fredericton and Woodstock.