Tony Coulson is group vice-president, corporate and public affairs, at Environics Research.
Taxes are a hot topic in the news. Jurisdictions across Canada are debating road tolls, carbon prices, property taxes, parking levies and user fees. Rarely, however, do these discussions move beyond narrow (usually negative) reactions to specific proposals and toward a more productive level of civic discourse – answering the question of how to pay for things society wants.
At Environics, we have been studying Canadians' attitudes and opinions on taxation for many years and certain patterns have become evident over time. Many Canadians, for example, do not consider the country's tax system fair to the average taxpayer and about half feel they pay too much in tax. Remarkably, however, four in 10 do allow that the tax they pay is "about right."
Canadians also tend to express stronger support for tax scenarios that see others pay tax. When we ask about taxing "the rich" or corporations, most say that sounds better than paying higher taxes themselves. These patterns are not all that surprising and likely provide the foundation for anti-tax reactions that crop up when specific tax proposals arise.
There is another layer to this discussion, however, and it may come as a surprise to many, especially those in the anti-tax crowd. Over the past decade, we have consistently found that about two-thirds of Canadians say taxes are mostly a positive thing, because they pay for important things such as health care, education and roads. But, about two in 10 say taxes are mostly a negative thing because they take money out of people's pockets and hold back economic growth and wealth creation. It's notable that when presented with these pros and cons, the ratio of Canadians who say taxes are on balance a good thing to those who say taxes are on balance harmful is about three to one.
Most Canadians are accepting of taxes in principle, because they are used to paying for public services that they value. And that is the rub. If you need to introduce a fee or tax and your goal is public acceptance, then there needs to be a credible – or at least plausible – case that it will pay for something that taxpayers care about.
Carbon taxes are a useful example. Our surveys have found that despite not feeling particularly well-informed about climate change, enough Canadians are concerned about it that they are willing to accept a carbon tax – about six in 10 in British Columbia, where the tax has been in place for some time, and a similar proportion in other provinces when asked about the introduction of such a tax where they live.
If a carbon tax attracts six-in-10 support even as Canadians admit to a shaky grasp of the issue, imagine how willing Canadians would be to pay their share if they felt confident that such a tax would solve climate change.
Most Canadians believe that governments play a positive role in society and more often contribute to solutions than cause problems. Canadians also care deeply about their public services. When asked about important symbols of Canadian identity, for example, our publicly funded health-care system tops the list.
When it comes to taxes, then, most Canadians tend toward acceptance based on their confidence in government and the value they place on public services. Getting the public behind a new or higher tax is no simple task, however. Given the choice between giving up some money and not giving up any, most people's immediate preference is obvious.
Although Canadians are open to being persuaded on taxes, persuaded they must be. Leaders must make their case by drawing a credible connection to something people care about. Taxpayers will have to acknowledge the problem, trust the suggested solution and be persuaded that the revenue from the proposed tax or fee will indeed be properly allocated and have an effect.