Wealthy can avoid damage caused by tax cuts | National Union of Public and General Employees

Wealthy can avoid damage caused by tax cuts

For a family with 2 children, sending their children to private schools can cost up to $154,980 a year. That's 4.6 times the median income, based on the most recent figures from Statistics Canada. 

Ottawa (07 Sept. 2018)  — Cuts to public services follow tax cuts like Boxing Day follows Christmas. And contrary to what right-wing politicians like to claim, when public services are cut, we’re not all in this together. The wealthy are able to use their money to avoid most of the damage done by cuts to public services.

A reminder of how the wealthy are able to avoid the damage done by tax cuts came with Canada's Private School Guide, which appeared this week. According to the guide, wealthy families are paying up to $77,490 per child per year in private school fees to ensure that it won’t be their children that suffer if funding for public education is cut.

Low- and middle-income families pay price of cuts

While the wealthy can afford private schools, that’s not an option for the vast majority of families. For a family with 2 children, sending their children to private schools can cost up to $154,980 a year. That's 4.6 times the median income, based on the most recent figures from Statistics Canada.

"When politicians cut funding for education and other public services, it is low- and middle-income families that pay the price," said Larry Brown, President of the National Union of Public and General Employees (NUPGE).

Education, one of many services where wealthy avoid consequences of cuts

Whether it is services for seniors or recreation facilities, the ability of the wealthy to buy much more expensive services privately means they are able to avoid the consequences of cuts to public services. As with education, low- and middle-income earners are left struggling to cope with the cuts to public services.

Two-tier medicine would allow the wealthy to avoid consequences of cuts to health care

Because of restrictions on two-tier health care in Canada, it’s more difficult for the wealthy to escape the consequences of cuts to health care funding than with cuts to other services. It’s why it’s politically harder to cut funding for health care. It’s also why we are seeing well-financed court challenges to laws intended to ensure that we don’t end up with one health care system for the rich and another for the rest of us.

Wealthy only group to benefit from tax cuts

Most Canadians are worse off when income taxes are cut. That’s because the impact of cuts to public services is far greater than the minimal amounts they save. For the wealthy it’s a different story. The amount they save in tax cuts is greater than the cost of paying for services privately.

But what’s good for the wealthy isn’t good for society as a whole. The combination of tax cuts and cuts to public services is a major cause of the rise in income inequality. Even though there is growing awareness of the problems caused by income inequality, lobby groups and think-tanks funded by the wealthy are still pushing for more tax cuts.

"If we are going to reduce income inequality, we cannot afford to lose sight of the fact that while the wealthy can avoid the damage caused by tax cuts, the rest of us can’t," said Brown.


NUPGE

The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 390,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. — NUPGE

 

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