Monday, May 18, 2009

The Base Tax Debate

The matter of whether Prince Albert should adopt a base tax was raised, even though it wasn't on the agenda, at the last council meeting. It's come up several times over the past nine years that I've been on council, including about eighteen months ago with this current council; once again, it's back.

The idea behind the base tax seems relatively simple - city services cost a certain amount each year, so the fairest thing to do is to divide the cost equally among all residences - that would be fair, right? However, the principle followed in most taxation tends to be more of a sliding scale - assessments consider that, if your home has a higher value, your tax level is higher, because you can probably afford to pay more. It's the same principle behind income tax - you make more money, not only do you pay more tax, but your income is taxed at a higher rate.

In this way, services can be provided to everybody, but at rates that recognize the basic inequities of our lives. About the only tax that I can think of that is applied fairly is sales tax - if you buy something at a certain price, you pay the same tax as someone else who buys the same item, even if they make way more money than you do. And even this is evened out somewhat by the GST rebate for lower income earners - I've never received this, but both my children have, even though I've paid more GST than they have over the course of a year.

I can get pretty passionate about the base tax, because the arguments that are used rely heavily on generalizations, and can start to make some rather cruel assumptions about lower income areas of the city. For example, I've heard (and the claim was made on the local paper's web-site) that people in lower income areas should be paying more, since that's where all the crime occurs. What about the people who live in these areas who aren't criminals? How is this fair to them? I'm pretty sure that police and fire services get called to all areas of the city. I've even called the police a few times myself, for matters ranging from a young kid breaking through the screen on the front door late one night, to a noisy neighbourhood party. I probably could have dealt with these matters myself, but the police are professionals, and, like the rest of the city, I count on and appreciate their help.

I guess that a truly fair system would be to just track police and fire calls, and bill people accordingly. Of course, then people might hesitate before calling, or decide to take matters into their own hands, which could result in even worse problems. And then, our taxes pay for far more than just police and fire services. What about the city's support of institutions such as the golf course, the Rawlinson Centre, the Art Hauser Centre, and the new soccer centre? My guess is that those people who benefit from those subsidies aren't living in lower value homes. If I have no intention of ever using the golf course or soccer centre, can I opt out of paying my share of the taxes for those? And this past winter there was a snow lift in the West Hill - the first ever in a residential area - should people who benefited from that pay more tax?

And if we want fairness, what about those of us who were paying for recycling services that we didn't receive until lately (I have a friend whose home just received a back alley recycling bin in April - several months after the city announced the program was complete, and more than five years after having this service added to the water bill). When I suggested a year ago that homes without this service should receive a rebate on their sanitation fees, more than one member of council said that people without this service were quite happy to subsidize those homes with the service - not true in at least a couple of cases that I'm aware of. And what about the unfairness of the increase in water fees to pay for upgrading - applied only to residential users, and not to commercial businesses? And that's not even getting into the unfairness of the minimum water charge - if you use less water, you still pay that minimum charge, which hardly seems fair, especially for smaller families or seniors. We can get into very murky waters very quickly when we start to talk about being fair to everyone.

A good number of my constituents are seniors, on fixed incomes. They have lived for many years here, paying taxes and being good citizens. For many of them, remaining in their own homes takes a great deal of financial balancing and sacrifice. To suggest that somehow, they owe the city more than they can afford, because of some blinkered vision of "fairness" doesn't seem right to me.

A base tax will put proportionately more tax burden on our poorest citizens. I cannot support that, and I won't.

"Very few people can afford to be poor." George Bernard Shaw