Canada As if following the predictions of critics, the federal government indicated last week that it will reduce the rate on the contentious Goods and Services Tax to seven per cent — but will make the pack- age even more regressive by cutting back spending on government programs and reducing the rebates and indexation avail- able to lower income earners. The new government proposal, floated by Finance Minister Michael Wilson and Prime Minister Brian Mulroney Monday, essentially follows the recommendations of the Standing Committee on Finance which called for a seven per cent rate, reduced rebates and a broadening of the tax base. The report, from the Tory-dominated ; committee, came as little surprise since it as ‘tf they do that, they'll do exactly what we want them to do.’ — Thomas Aquino, Business Council on National Issues was widely expected that the committee would suggest ways for the government to tinker with its proposal while keeping the regressive tax essentially intact. The government’s own proposals were also expected by many since it was the corpo- rate sector which had campaigned for a lower rate, coupled with reduced rebates and government spending cuts. Significantly, Thomas D’Aquino, pres- ident of the Business Council on National Issues which represents the country’s top 150 corporations, said that if the govern- ment put its proposals in place “they'll do exactly what we want them to do.” The proposed changes would do nothing to offset the regressive nature of the tax but would penalize lower income families by imposing further cuts in Tories’ GST alterations echo business already-reduced government programs. The Liberal and New Democrat members of the finance committee issued dissenting reports, reiterating their demand for the scrapping of the tax. The has been echoed across the country by unions, anti-poverty, church and women’s groups who have mounted peti- tions and other actions against the GST. ‘In a speech earlier this year, economist Marjorie Cohen, who as representative of the National Action Committee on the Status of Women has been one of the most effective critics of the GST, warned that the government may have deliberately set its proposed GST rate high in order to end up with what it intended all along — a slightly reduced rate coupled with cuts in government spending. Season's Greetings to the labour movement liga Se OS OE eee | Holiday Greetings and Solidarity pesticides, and demand inclusion in health and United Fishermen and Allied Workers’ Union Local 1 in 1990. Continue the fight against dangerous safety regulations for farmworkers. Canadian Farmworkers Union Sarwan Boal (President), executive, and staff #1, 4725 Kingsway, Burnaby, B.C. V5H 2C3 'Season’s Greetings and Best Wishes for the New Year to all our friends in the labour movement. INTERNATIONAL LONGSHOREMENS & WAREHOUSEMEN'S UNION Socsesoo JIM RUSHTON President 4 Pacific Tribune, December 18, 1989 - Season’s Greetings | from Prince Rupert Labour Council DANI WOODS . Secretary-Treasurer x Meetings on Island | blast proposed tax Special to the Tribune Vancouver Island citizens voiced their opposition to the proposed federal Goods and Services Tax at a series of public meet- ings held late November in Courtenay, Port Alberni, Nanaimo, and Victoria. “The GST is rightly called the Gouge and Screw Tax,” Vancouver labour journalist Ben Swankey, the keynote speaker, told the Victoria audience. He and NDP MP Bob Skelly, who addressed two of the rallies, endorsed a call for a national day of the protest against the tax, pro- posed by Finance Minister Michael b Wilson and slated to —— take effect Jan. 1, SKELLY 1991. Swankey won rounds of applause in calling for the scrapping of the tax and suggesting alter- natives such as cut- ting military spend- ing, reducing interest rates and calling in some $35 billion in deferred corporate SWANKEY |. taxes. (The inner cabinet, in a move calculated to defuse the massive opposition to the tax, decided at Meech Lake Dec. 9 to reduce the proposed tax to seven per cent.) “Tt is the single greatest tax grab in Cana- dian history. At the rate of nine per cent it will take $27 billion out of your pickets and mine every year,” Swankey, author of an expose of the federal budget titled “From Our Pockets to Theirs,” told the Victoria rally. “Once it’s in place, they’ll just keep on raising it every year. It’s a financial milk cow ‘for the Tories.” Skelly urged some 100 people at. the Courtenay meeting to make their opposi- - tion known to the government in Ottawa by letters, phone calls, resolutions and other means. A proposal from the floor that labour and citizens organize a Day of Protest against the GST was applauded. ’ Atan overflow meeting of more than 200 in Port Alberni, Skelly charged that the GST will increase the rate of inflation by at least five per cent. Skelly predicted that when the Manufac- turer’s Sales Tax is removed, manufacturers will not reduce prices but simply pocket the $18 billion the tax now brings in. Swankey told the meeting that cuts in military spending, now at $11.1 billion a year, and reduced interest rates would help to reduce the deficit. However, he said, the main means to bring down the annual deficit of $25-$30 billion as well as the $230.9 billion national debt is to make the corporations shoulder a much greater share of the tax burden. “A bank clerk”, he charged, “pays a higher rate of taxation than the bank he or she works for.” Reg Gates, vice president of the Old Age Pensioners, urged citizens to bring pressure onthe “idiots” in Ottawatocompelthemto drop the GST. : NDP MLA Gerrard Janssen predicted that the “Grief and Suffering Tax” would increase taxes for an average family of four by $839 a year. He proposed a minimum 20 per cent tax on corporations. In Nanaimo, Swankey drew attention to a report prepared for the 10 provincial pre- miers which predicted that the GST would cut 434,000 jobs between 1991 and 1993. Noting that public opinion polls show that 87 per cent of Canadians oppose the — GST, Swankey said government is deter- mined to go ahead with it because it has been ordered to do so by the Business Council on National Issues, whose members “finance the Tory party and are the real government of Canada.” Mike Blumel of the Nanaimo City Centre Association, a small business group, pre- dicted that the loss of disposable income resulting from the tax as well as the addi- tional cost of collecting it would cause many small businesses to close. A trade unionist in the audience noted that the leadership of the Canadian Labour Congress is not leading the fight against the GST and urged local unions to press it to act. “The whole purpose of this budget, which imposes 26 new taxes on us, is to further shift the burden of taxation from the corporations to ordinary people,” Swankey told the Victoria meeting. Much of the discussion after Swankey’s speech centred on action to defeat the tax. Optimism was expressed about the cam- paign against the GST being waged by the Pro-Canada Network, the umbrella body that had united so many groups in the fight against the Free Trade Agreement.