Ted Chudleigh Blog

We have fools running the government. But you knew that already.

It appears the McGuinty Liberals have a mistaken impression of how incentives work.

So far the 90 day review of the eco-tax program, has hatched the idea of charging manufacturers lower eco-taxes on various products to encourage those same manufacturers to compete to produce less toxic products. This approach ignores the fact that many of the products being taxed have no business being taxed, that much of the packaging is already covered by existing blue box programs, and less toxic in many cases will simply mean less effective. What is worse, Miller fails to grasp that consumers will end up paying any additional fees charged to manufacturers. Consumers always pay in the end.

If you really want to make this program effective, and really pull toxic waste from going to landfill the only way to do it is by providing an incentive to consumers to drop their used materials off at a depot. Give them money. The government gets the money from a front end charge like a deposit on beer bottles, and returns the deposit when the empty or unusable product is brought back to the depot.

Municipal dumps could handle the task. Many landfills already have Household Hazardous Waste depots – there is just little incentive for everyday folks to use them.

Funding the program by chipping off a portion of those eco-taxes collected as product deposits and giving them to municipalities to operate the program would vastly improve diversion rates, make for cleaner, greener landfills, extend the life of existing landfills and provide a stream of recyclable materials for reuse.

People will do amazing things if they are provided a reasonable rationale and a bit of incentive. Part of that reasonable rationale would be to reduce the number of products covered in the plan. Municipalities might even provide a Red Box to store used batteries, old electronics and paint cans and whatever else is deemed toxic enough to be included in the program.

The government’s current plan is merely a tax grab. They want money from the manufacturers to give to Stewardship Ontario but there is no real commitment to removing toxic materials from the waste stream.

Of course this idea would require some streamlining. It is important to take enough time to get it right rather than simply charging ahead and leaving a wake of inexplicable charges, no rationale plan and no buy-in of the program by the public. Public input would be valuable and help the public believe in the program and take some ownership regarding its effectiveness.

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So now, the government is backing off the eco-tax. I’m guessing they’ll say no more about it until after the next election. If the Liberals win look for eco-taxes to come back and a carbon tax and who knows what else.

Apparently Canadian Tire determined they weren’t going to charge the eco-tax anymore because of all the product confusion, so the McGuinty Liberals cheerfully rescinded the tax so they could think it through this time. Well, with apologies to Ma Gump, ‘Tax policy is like a box of chocolates, you never know what you’ll get.’

As for killing the tax, who knew it was this easy.

If we get enough people to complain the HST is too confusing, what with some items exempted and strange tax on tax situations which have cropped up, apparently the government will simply cave in.

Since when does Canadian Tire dictate government policy?

Oh, I agree that the eco-tax is a logistical nightmare with some items taxed by weight, some by size and some with different amounts of tax applicable at different rates to different parts of the same product. Yet the biggest problem is that the government states these taxes will help divert hazardous wastes from landfill but makes no mention of reimbursing people for their cash when the hazardous material is turned in. Last time I looked collecting a fee upfront in no way guarantees that people will recycle this material properly. Unless Stewardship Ontario is planning to hire a large numbers of garbage sorters their plan seems to have a giant hole in it.

And yet, even if the government has backed off, ostensibly until they can make this tax more logical and understandable, they still haven’t addressed the major issues.

Why are we paying ecotaxes on products that we already pay fees to help recycle? Why are we paying fees on items that we use and there is nothing left to recycle? Why are we expected to fill the coffers of Stewardship Ontario and what are they going to do with all this money? Who sits on this board and now apparently has the power to tax Ontarians?

Answers to those questions would be a great start. Instead we get a government more interested in soothing the ruffled public than in producing a program with a logical aim, a measured approach and an achievable result.

Again Ma Gump sums it up nicely – ‘Stupid is as stupid does.’

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We’ve reached the breaking point.

Government is the problem. Or more specifically, big government is a big problem.

The McGuinty Liberals have a spending problem. Sure revenues have fallen as the recession continues to bite hard on our economy, but it is spending which is out of control.

The government’s solution: increase taxes. This is a government that does not get high marks for policy development as they bounce from one created crisis to another, leaving a trail of nanny state legislation in their wake. Yet it appears they’ve spent their creative ability on how to take more and more of your money without you noticing the theft. They have increased user fees, hiked utilities, slapped on surtaxes, driven up consumption taxes and introduced hidden fees. All of a sudden people are seeing far less disposable income and they wonder where it’s all going.

Well, Dalton is at the other end of the siphon. While he can take your money he can’t bring himself to wean Ontarians off government handouts.

Well that inability and the recent triple whammy of HST, ecotax and higher hydro bills is where the good ship Ontario runs aground.

We can’t take it anymore. The hidden, unannounced little ecotax is the final straw. The party is over.

All that is left now is to clean up the mess. Problem is the McGuinty Liberals will continue to party on the broken down remains of Ontario’s economy while ignoring the mess for another year.

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So did you feel the earth move?

Well, some people felt the earthquake but I was referring to the more cataclysmic event, the imposition of the Harmonized Sales Tax.

I for one have felt it, and not in ways that I expected.

So far I’ve heard of HST being charged in some situations where it was not required but where the small business was using it as an opportunity to raise prices. Prepared foods under $4 should not be taxed, but a recent slice of pizza cost me 50 cents more after Canada Day than it did before. I was told of a haircutter who raised his prices due to the HST several weeks before the tax became official.

Regarding haircutters, another story was related to me where customers said they would simply get their hair cut less often because of the additional cost. So a haircutter will do much less business while having to absorb the additional cost of HST being applied to their utilities and general cost of doing business. That is not a recipe for success.

Of course Dalton McGuinty promised the HST would bring more employment. While I never believed that whopper, it appears the HST in some service industries might actually reduce jobs as it forces people out of business, like our haircutter whose business is being trimmed.

As for the HST being attached to gasoline, the cost of gas went up for the long Canada Day ‘weekend’  but will never come down, disguising the increase. What irks me the most about the HST as it applies to gasoline is that it comes on top of a 10 cent per litre federal excise tax and a 14.7 cent per litre provincial gas tax that is already applied to the product before you buy it. That means that you and I get to pay tax on tax. It would be far more reasonable to charge HST only on the cost of the product before taxes are applied to it.

Now, I wonder if the agreement that the McGuinty Liberals signed with the federal government making changes to HST very difficult to impose, would allow for that accounting change. Certainly saving 13 per cent tax on 24.7 cents of each litre of gas would represent a considerable saving to the average consumer – about three cents a litre in fact.

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