Fixing the Fiscal Imbalance: Turning GST revenues over to the provinces in exchange for lower transfers

Kenneth J. Boessenkool
Additional contact information
Kenneth J. Boessenkool: The School of Public Policy, University of Calgary

SPP Research Papers, 2010, vol. 3, issue 10

Abstract: The central argument of this paper is that Canada should better align provincial own-source revenues with provincial expenditures by turning over the GST to the provinces while simultaneously reducing federal transfers. The paper begins by broadly outlining of Canada's present fiscal arrangements and explains why a reduction of cash transfers and realignment of federal and provincial tax rates – in short, a transfer of tax points – would benefit the federation. It reviews past tax point transfers and then addresses the question of why transferring GST revenues is superior to other alternatives using the principles of tax assignment as the guide. It lays out two comprehensive proposals for transferring GST revenues, with the key difference being the way in which the GST transfer is equalized across provinces. It shows the impact on Ottawa and the provinces of these two proposals for the 2009-2010 fiscal year. It highlights the benefits of these changes from a federal, provincial and taxpayer perspective with a special focus on one of Canada's major expenditure challenges - what to do about public health spending.

Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.policyschool.ca/wp-content/uploads/2016 ... ssenkool-online3.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:clh:resear:v:3:y:2010:i:10

Access Statistics for this article

More articles in SPP Research Papers from The School of Public Policy, University of Calgary Contact information at EDIRC.
Bibliographic data for series maintained by Bev Dahlby ( this e-mail address is bad, please contact ).