Fair Taxes for Nova Scotians - What Would That Mean ?. Lars Osberg Economics Department, Dalhousie University. What do Taxes Do?. Taxes Raise Revenues – pay for services & transfers Public Services influence Level of Output E.g. roads, schools, police, health care
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Lars Osberg Economics Department, Dalhousie University
– Fair Level to imply sufficient revenue + Fair Structure to share burdens fairly
Disincentives? – Do taxes reduce incentives for desirable behaviors?
Correct Incentives? - Can taxes help Private Incentives align to Public Good?
Some privately desirable behaviours cause harm to others
- Taxes as compensation for harm & added incentive to avoid
Fair Taxes – both process and outcome equity matter
Fairness is a multi-dimensional idea
Total tax incidence proportional over most of range – progressivity erodes since 2000Marc Lee, (2007) Eroding Tax Fairness: Tax Incidence in Canada, 1990 to 2005 Canadian Centre for Policy Alternatives, Toronto November 2007
Marc Lee, (2007) Eroding Tax Fairness: Tax Incidence in Canada, 1990 to 2005 Canadian Centre for Policy Alternatives, Toronto November 2007
The “Double Dividend” of Carbon taxes (everywhere)
- increased incentives to reduce fossil fuel usage
- produces revenue which enables other taxes to be cut
Nova Scotia: The “Double Deficit” of Fuel Oil Tax Exemption
- less incentive to reduce CO2 emissions
- $88 Million less revenue for services &/or lower taxes