NDP Leader Jagmeet Singh rebuffed suggestions that his proposed tax hikes would hit Canadian households and send businesses running for the border as he released his party’s costed platform in Ottawa this morning.
The party is promising to raise more than $30.5 billion next year to help pay for its core promises, such as a national pharmacare plan and more affordable housing units.
The platform’s most significant tax pitch is a change to the capital gains system. The party says it would bring in more than $8 billion annually by increasing the tax on profits from selling a second home (like a cottage), or investments like shares, stocks and bonds.
That tax would increase from 50 per cent to 75 per cent, returning the rate to where it was before 2000. Unlike some of the NDP’s other planned tax moves, it would affect more than just the super wealthy.
“The majority of people impacted by this will be the wealthiest. There are some that will be impacted in a small way that are not the wealthiest in society,” said Singh.
“So there’s still an incentive, but we’re making it closer to what people would be doing if they were just earning that salary regularly.”
The NDP says it also can net nearly $6.3 billion next year by increasing the corporate income tax rate by three points and promises its “super wealth tax” — a one per cent tax on every Canadian with a net worth exceeding $20 million — would bring in close to $6 billion its first year.
The party says it would find an extra $5.8 billion by cracking down on tax havens.
“We’re actually going to save businesses a lot as well with things like universal pharmacare. It’s going to reduce the cost for businesses,” Singh told reporters.
“But overall, if you look at the reasons why companies invest in a city, or a community or country, taxation is one reason but it’s not anywhere near the top reasons.”
$32.7B deficit next year
The United States’ $1.5 trillion tax cut under U.S. President Donald Trump has been driving fears of business flight to the U.S. After the Liberal government was accused of increasing the tax burden on businesses, it committed to spending billions to help corporate Canada compete with the U.S. during its last fall fiscal update.
The New Democrats released the planks of their platform in June, before the pre-election barbecue and summer fair circuit, but it was missing some key dollar figures.
This morning, on day 31 of the federal campaign, the party presented line items describing how it would pay for those policies, which were costed by the Parliamentary Budget Officer.
The biggest ticket item is the $10 billion the NDP says it will put up to support a national pharmacare program, although it has said it will need buy-in from the provinces.
The party is also pledging $5 billion to build new affordable homes, $1.8 billion to end boil water advisories in Indigenous communities and another billion dollars to retrofit buildings to be more energy-efficient.
With fears of a global recession growing, Singh said the party is planning on a contingency fund. The NDP platform document says the fund would be “equal to 15 per cent of our combined new revenues,” which comes to about $4.5 billion in 2020-2021.
If they’re successful on Oct. 21, the NDP is proposing to run a deficit of $32.7 billion next year, with no immediate plan to return to a balanced budget.