For the longest time, Quebeckers have been shrugging off the concerns
of fellow Canadians over the Parti Québécois’s so-called menace.
Despite
the party’s quest for independence – which is far from shared across
the population, as sovereignty is dormant on the Richter scale of
pollsters – Quebeckers never doubted the PQ’s willingness to foster
growth. Likewise, they could generally count on PQ premiers to soundly
manage the province, though there were some notable blunders.
Former premier Bernard Landry has always defended free trade as a way
to create wealth. Lucien Bouchard was obsessed with the province’s
fiscal woes, fighting hard to secure a political consensus around the
“déficit zero” target. Jacques Parizeau presided over the rise of a
generation of French-Canadian entrepreneurs through his innovative
Quebec stock savings plan.
Far from being anti-business, these PQ
premiers bent over backward to court investors and create a favourable
business environment. Which is why Quebeckers are now as stunned with
Pauline Marois’s economic plans as the coyote in Road Runner who is hit
by an anvil he didn’t see falling. Where did these retroactive tax hikes
come from?
The PQ government that has regained power after nine
years in political wilderness is markedly to the left of its
predecessors, with key ministers held by green activists. It is also
“gauche” in the figurative sense, as it clumsily and precipitously
unveiled its plans.
In just the past week, the Marois government
revealed that its tax hikes would be retroactive to Jan. 1. It hinted at
a permanent ban on shale gas exploration, before the completion of
scientific studies that will determine the safety of the hydraulic
fracturing used to free natural gas from rock formations. And it
announced the closing of Quebec’s only nuclear plant before meeting with
the leaders of the Mauricie region where the Gentilly II plant and its
800 jobs are located.
Retroactive income tax hikes are rare. In
1993, Gérard D. Levesque, Robert Bourassa’s finance minister,
controversially imposed two surtaxes of 5 per cent each on the “rich”
Quebeckers earning more than $32,500 and $54,300, respectively.
But
no one has ever increased the capital gains tax retroactively, an idea
the Marois government is mulling, but may now abandon as its seeks a
compromise. Imagine you sold your cottage in February and invested the
proceeds elsewhere, to find out you owe money on that transaction? This
flies against the basic fiscal principle that taxpayers should have
certainty.
New Finance Minister Nicolas Marceau toured the most
listened-to stations Tuesday to defend his plan. “I claim we were
clear,” he said during a Radio-Canada interview, when asked why the PQ
had hid the retroactive tax increases.
The PQ said that they would
abolish the controversial health tax within 100 days of taking power,
creating a $1-billion shortfall, argued Mr. Marceau. Quebeckers should
have logically deduced that the only way to pay for this was to change
the rules, the minister said.
No matter which way the new Finance Minister wants to spin this, the PQ lied by omission.
There
are good reasons to amend the regressive health tax, a $200 yearly
contribution that all taxpayers must pay, no matter what their income.
There are also logical reasons not to upgrade the Gentilly plant. The
refurbishment will cost between $2-billion and $3-billion, and the
province is already flush with surplus electricity.
Yet it is hard
to escape the conclusion that the Marois government is deliberately
bashing Quebec’s highest-income earners, and its energy industry, in a
populist bid to secure a majority government.
Who is going to
defend the 140,000 plus Quebeckers who earn more than $130,000 a year?
Who is going to defend nuclear energy and fracking? If you want to
reclaim the ground to the left taken by the new Québec Solidaire party,
there are no better targets. While this might play well in certain
circles, this is now seen as a disaster by business leaders, who fear
the PQ’s newstance will scare away talented professionals and investors.
Mr.
Marceaus has been trying to reassure the business community.
“Quebeckers will derive their prosperity from a faster economic growth
and a business community which enjoys an attractive environment,” he
said.
Fine words but all of the PQ’s actions since they took office speak otherwise.
