Jarnhamar said:
Why does Quebec need so much money in equalization payments? What the hell are they doing in that province?
Spoken like a true ignoramus, Jarnhamar (but then again, you seem to be one of those "screw Quebec at all costs" people in these pages).
Transfer payments, not just equalization, which is only one part of the picture from the federal government go to ALL provinces (Yes, even Nfld and Alberta, where it constitute about 15% of provincial revenues BTW).
As for Equalization payments, their purpose is to correct for discrepancies in the tax base from province to province so that generally
equivalent services can be provided on a
generally equivalent taxation rate.
This means that, IF the services provided by the provinces were the same in all provinces, then the resulting provincial taxation rates would also be the same in all provinces as a result. We all know, however, as people in these fora like to remind us all the time, that Quebec provides its residents with rather
more services than the other provinces, but - funny enough - it also has the highest provincial taxation level. The conclusion here, BTW, is that it means that Quebec is NOT using equalization to provide itself with more services it could not otherwise afford, but that Quebecers are actually paying for those extra services by themselves - with their own money. Period.
Going back to the equalization payments themselves, they are derived from the average figure for
per capita GDP. The per capita GDP of each province is compared to the national average. Anyone with a per capita GDP below 95% of the national average
gets a per capita payment to bring the
tax generation capacity in line with the average (for instance, lets say province X has a GDP $5,000 below average, and $5K GDP is expected to translate into $1K of tax revenue, that province will get a transfer of $1,000 for each resident).
So what are each province getting for the last year the figures are available (2014-15, Parliamentary Budget Officer's web site): [and I will put them in descending order of per capita amount]
SK - AL - BC and NL received zero.
PEI: $2,477.60
NB: $2,205.80
NS: $1,728.10
MB: $1,367.40
QC: $ 961.50
ON $ 145.70
Purely for comparison sake here, I will provide the equalization payments for the three Federal territories, which people seldom include in their discussions: Yukon: $ 23,052.70; North-West Territories: $ 27,878.50; and (watch out) Nunavut: $ 38,797.00. Basically we, in the South are paying just about 100% of the taxes of those living in the territories.
Funny enough, I seldom, if ever, see anyone bitchin' about "Why does Manitoba/Nova Scotia/New Brunswick or PEI need so much money, what the hell are they doing in those provinces". Anyone here wants to debate that there isn't a discriminatory approach to Quebec, with racist underlying cause still existing in the R.O.C.? I am open.
Now, here is the next piece of the puzzle for Equalization. Watch out, this is a complicated concept to grasp: The residents of the provinces that receive no equalization
do not pay any more than any one else in Canada for the money sent to the receiving provinces in any form or shape. They are NOT taxed extra on either their Federal or Provincial income taxes (and in fact, being above national average for GDP, probably pay less provincial income taxes or get better provincial services), they do not pay higher GST or PST (if any, again).
The Equalization payments come from the Federal government general revenue fund, that is, the general melting pot fund where all the money collected from any source by the Federal government goes. ALL Canadians pay into that fund equally (meaning same tax rates for any type of Federal taxes) regardless of where they are located.
Ah! Ah! You say: people in those "rich" provinces will still pay more because they are rich. Well: No. a rich person in those provinces will pay exactly the same as a rich person in any other province. Same goes for a poor person in either provinces: There is NO extra charge imposed in any way on the residents of the "rich" provinces.
Surely the government must collect more from those provinces, you say. Well, the Federal government does not compile
where it gets its revenue from. But Statistics Canada keeps data on various revenue streams and where they are paid from, etc, so a compilation is possible and, lucky for us, some people take the time to do those compilation.
The latest one I could find ( http://thoughtundermined.com/2012/07/22/a-closer-look-at-federal-revenues-and-expenditures-by-province/ ) is for 2009, which is great because we are at the height of the oil boom in Alberta; Saskatchewan and Newfoundland - the oil prices hadn't even started to tank. Let's deal with Federal revenue from various provinces as a percentage of total revenue:
ON: generated 40% of revenue
QC: generated 18% of revenue
AB: generated 17% of revenue
BC: generated 13% of revenue
All the other provinces and territories, together, generated the last 12% of federal revenue.
What this means is that, at the height of the oil boom, Albertans - without being taxed any differently than anyone - contributed a little less (1%) than Quebecers themselves towards the equalization payments made to the Government of Quebec.
So I suggest we all can the bullshit where equalization payments are concerned.
krimynal said:
Trust me when you ask people here in Quebec what they think about the fact that we receive more money than any other province in Canada the answer is , a lot of times , "Well we pay more taxes to the federal , and we are giving them all the electricity and all our wood , so its only right they give us more money"
I stopped trying to understand the logic that most french people here have .... because it makes no sense whatsoever
Criminal, I don't know where you come from, but I have lived most of my life in Quebec and I have
never ever heard what you refer to. If you want to make such statements, I strongly suggest you back them up with references. Quite to the contrary, most people I know here feel ashamed of receiving equalization and would like nothing better than get off them. The only unfortunate problem is that (as in any province) there is a disconnect between understanding the problem and seeing solutions you can translate into the political arena successfully (such as, in QC's case, removing the self-imposed barriers we have put in the way of our businesses so they can flourish).