29 June 2011

Wealth transfer

As nottawa noted on Tuesday, the net effect of a provincial tax cut on electricity and a rate hike for the province’s Crown energy company isn’t what might appear at first glance.

First, there’s not going to be a drop in cost for consumers, as some might have thought.  He based the calculations on a monthly bill of $300 per month before taxes:

$339.26 is greater than $339. The government isn't giving you a discount this October at all. In fact, your monthly bill is actually going up. So much for "reduc(ing) the cost of living for all consumers". And on a year-over-year basis, they're sticking it to you slightly more, because the increased rates take effect this month, while the as-yet-imagined HST discount won't start until October.


all of those millions of dollars … that are going "back" into the hands of taxpayers represent millions less on the government's books in the form of tax revenue. But an equivalent or slightly higher amount is now flowing from rate payers into NALCOR's coffers, where it can be safely spent with far less public scrutiny. (Like this, for example).

- srbp -