Study shows cutting corporate taxes costs thousands of Canadian jobs
A report by Canadians for Tax Fairness highlights the consequences of corporate tax cuts in Canada. Their analysis employs data used by Finance Canada and Statistics Canada to estimate that for every $1 billion in corporate tax cuts, 1,400 jobs are produced within two years. This number, however, does not consider the losses in jobs as a result of decreased public spending.
On the other hand, every $1 billion of government expenditures “on infrastructure, housing, and measures for low income households” yields an average of 7,000 jobs within two years. If public spending is reduced in order to finance corporate tax cuts, there is a resultant loss of 5,600 jobs for every billion dollars.
This scenario is playing out in Alberta, where the Kenney government has already cut the corporate tax rate by 2 percent. To offset the lost revenues, the United Conservatives have also initiated sweeping cuts to public spending, with thousands of public employees slated to be laid off. The “Job Creation Tax Cut” was supposed to bring in thousands of jobs, but Alberta has lost 50,000 jobs since the first reduction took place.