Harper plans deficit tax on workers and employers

OTTAWA – The Harper Conservatives plan to reduce the deficit by levying $19 billion in higher taxes on workers and their employers, says New Democrat Finance Critic Thomas Mulcair.

“In the fiscal update Finance Minister Flaherty released on Thursday, he showed that he plans to raise $19 billion in new revenue by increasing the Employment Insurance payroll tax. Yet he’s telling Canadians the opposite, that he won’t raise taxes,” said Mulcair.

Two months ago, New Democrats warned that an analysis by the Parliamentary Budget Officer and actuaries showed that workers and employers were facing huge increases in payroll taxes in 2011 because of a decision by the Harper government to invest only $2 billion in its new Employment Insurance account.

The Conservatives, with the support of the Liberals, plundered the $57 billion surplus paid by every worker and employer in Canada for EI. They then gave these $57 billion in tax cuts to the most profitable businesses. In fact, businesses in the forest and manufacturing sector, that didn’t qualify for tax cuts since they weren’t profitable, were therefore subsidizing the richest companies. Now, businesses, whether they were profitable or not, whether they had access to the tax cuts or not, have to pay $19 billion to correct this culpable negligence.

“The issue now is what choices should the federal government make to tackle the ballooning deficit,” said Mulcair. “The Conservatives and Liberals think that it’s ok to transfer billions from workers and employers to fund tax cuts to the most profitable businesses. New Democrats fundamentally disagree.”