Franco Terrazzano is the Federal Director of the Canadian Taxpayers Federation
It will be illegal for politicians to raise taxes without permission from taxpayers through a referendum.
That’s the promise from Conservative Leader Pierre Poilievre. Every major party promises tax cuts and Poilievre is promising big income tax cuts. But taxpayers are painfully aware that tax hikes always sneak back in as big government spending pushes up debt and interest charges.
Poilievre’s promise rebuilds trust.
A Conservative government will “never hike taxes and pass the Taxpayer Protection Act to ban new or higher federal taxes without asking taxpayers first in a referendum,” according to Poilievre’s platform.
This is great news for Canadians fed up with the government hiking taxes and wasting money. It’s bad news for Ottawa’s money hungry politicians, bureaucrats and lobbyists.
The best way for governments to make life more affordable is to let Canadians keep more of their hard-earned money. Even though former prime minister Justin Trudeau promised to “lower taxes for the middle class and those working hard to join it,” nearly nine in 10 middle-income families pay higher federal income taxes.
Trudeau told Canadians he wouldn’t raise taxes to pay for his debt binge.
“The last thing Canadians need is to see a rise in taxes right now,” Trudeau said in 2020. “We are not going to be saddling Canadians with extra costs.”
Since then, the federal government hiked payroll taxes, alcohol taxes, carbon taxes and imposed a luxury tax, a second carbon tax through fuel regulations, an anti-flipping home tax, a digital services tax, an online streaming tax, among other new taxes.
The government also tried to get away with an undemocratic and illegal capital gains tax hike.
And the federal government has been flirting with home equity taxes, including spending hundreds of thousands of dollars studying new home taxes and forcing Canadians to report the sale of their home with the taxman.
Liberal Leader Mark Carney has backed away from the consumer carbon tax and capital gains tax hike, but the rest of the Liberal tax-hike record remains intact. So even when the face of the government changes, taxpayers have trust issues.
All too often politicians promise they won’t hike taxes, then punish people with bigger tax bills after the election.
In 2003, then Ontario Liberal party leader Dalton McGuinty ran on a promise of no new taxes. McGuinty introduced a health tax the following year.
Politicians in British Columbia, Alberta and Ontario all imposed provincial carbon taxes without running on them in the prior election.
Before the 2019 election, then federal environment minister Catherine Mckenna told Canadians the government had “no intention” of increasing the carbon tax beyond 2022. After the election, Trudeau announced he would increase the carbon tax every year.
Taxpayer protection laws can save people billions of dollars every year. In 1995, the Klein government introduced the Alberta Taxpayer Protection Act outlawing a provincial sales tax without a referendum. Despite frequent pressure from taxpayer-funded academics and other big-government agitators, this law has shielded Albertans from sales taxes for three decades.
And while future governments can repeal taxpayer protection laws, history shows this leads to big political pain. Former Manitoba premier Greg Selinger gutted Manitoba’s taxpayer protection law and raised the PST without a referendum. In the next election, his party was defeated and reduced to its lowest number of seats in over 25 years.
In Ottawa, all politicians should be focusing on cutting spending, not hiking taxes. The federal government added 108,000 bureaucrats since 2016 and ballooned the cost of the bureaucracy 73 per cent.
The government put taxpayers on the hook for $30 billion in subsidies to multinational corporations like Honda, Volkswagen, Stellantis and Northvolt. The government spent $15.5 billion on foreign aid in 2022, which is nearly three times more than what it spent through the department of Veterans Affairs.
Poilievre committed to cutting income taxes, sales taxes for homebuyers and ending all carbon taxes. But his biggest commitment to taxpayers may be his promise to outlaw future tax hikes without a referendum. If politicians want to take more money from Canadians, they should be forced to ask first.
Franco Terrazzano is the Federal Director of the Canadian Taxpayers Federation.
