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By Robert D (anonymous) | Posted August 30, 2012 at 09:46:44 in reply to Comment 80144
As an additional tax it's not the fast food chain that is suffering for the extra $0.32 in tax per $4 item - that extra tax comes out of a person's pocket generally, and the effect is spread across all businesses that person interacts with. The impact on any one individual restaurant or establishment is negligible.
For example, people will still buy their $2 bagel, but they'll paid $2.26 for it instead of $2.10. Those extra $0.16 cents won't result in people skipping a bagel once every 14 days - they'll make it up somewhere else - maybe they'll buy 1 less item at the dollar store every month. You generally can't tie the effect of an indirect tax to the particular establishment offering a good or service being taxed.
In terms of it being a regressive tax - all sales taxes are regressive, that's why we have both federal and provincial programs to give back some of those funds to the poorest in society. Besides, maybe part of that extra 8% tax (which would be paid by all, not just the poorest) will be redistributed to the poorest in the form of increased provincial benefits.
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