Comment 28968

By A Smith (anonymous) | Posted February 23, 2009 at 05:59:58

Kevin, thanks for the invite, but I think I'll just stick to making people angry from a distance, it's probably better for my health.

JonC, >> Taxes are paid in dollars not percentages. And you pay less dollars in Hamilton than in Toronto or Oakville, so according to your logic, those cities citizens should be clamouring to move to Hamilton.

Then why does government charge people a TAX RATE on their property and not just a flat rate for all? If tax rates don't matter, then the city should simply divide the number of properties by the tax levy and charge all property owners the same amount. Therefore, if we use the 195k dwelling count (forgetting about businesses to keep it simple) that the census puts out and divide that by the 602 million the city needs in tax revenue, every Hamilton property owner would owe $3087. Therefore, if you owned a big house in Ancaster valued at 1M, your tax rate would only be 0.3%.

The reason government likes a TAX RATE and not just a tax number, as you argue, is because it allows their budgets to grow right along with people's net worth. Whenever people do well and the value of their property increases, so do the wages of all public sector employees, whether or not they are actually being more productive in their duties.

By abolishing the tax rate, in favour of needs/performance based budgeting, government would have to justify all expenditures on their merit and would not be allowed to give raises, simply because they didn't have to raise our property tax rate (seen as a victory in most circles). For example, when people shop for food, they don't base the prices they pay on the percent of their income, but rather the value for what they are paying. Similarly, property owners should not be duped into paying a fixed percentage of their property value, but rather should only pay higher nominal amounts if the city delivers more goods and services. This does not include pay raises for city employees who do the same job year in and year out.

By allowing the government to siphon off a fixed percentage of our wealth, rather than just paying them for how they perform and what they provide, we are telling them they never have to get better and more productive in their jobs, because they will always be guaranteed a fixed amount of our income. If anyone doesn't see a problem with this economic arrangement, then you probably work for the city.

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