The Spectacle Blog

A Note on Canadian Sales Tax

By on 9.30.11 | 1:34PM

This morning, Ross Kaminsky critiques the merits of Herman Cain's "9-9-9" plan. Kaminsky particularly objects to the introduction of a national sales tax stating, "Here's the important history lesson: Sales taxes almost never fall."

Kaminsky is wise to qualify that statement because Canada's Goods and Services Tax (GST) has fallen - twice. Canada's Conservative government lowered the rate on the GST from 7% to 6% in 2006 and from 6% to 5% in 2008. The Tories campaigned on this during the 2006 federal election.

Now Kaminsky is certainly on legitimate grounds when he takes issue with Cain's assertion that future administrations wouldn't propose increases to a national sales tax and future Congresses wouldn't implement them. But depending on who we elect and depending on how vigorous the electorate would be against future tax increases this isn't necessarily a foregone conclusion. The fact that our closest trading partner has decreased its national sales tax from 7% to 5% should give us cause for hope.

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