Canadian Finance Minister Rejects Health Tax Hike Plans

by Mike Godfrey, Tax-News.com, Washington

21 November 2002

Canadian Finance Minister John Manley effectively ruled out a dedicated health care tax in an interview on Tuesday, revealing that voters have already made clear that they won't stand for a tax hike in his forthcoming budget.

Speaking to the Canadian Press about a Senate Committee recommendation in October that the federal government should impose a dedicated health tax in order to pump an extra $5 billion into the health care system each year, Mr Manley explained that:

'By and large, what I hear from people is 'we pay enough and if you've got to save health care then stop paying on something else, please'. I'd have to be really persuaded that there's just no other way to meet the needs.'

He added that Canadian taxpayers are unlikely to tolerate deficit spending either, which means that in order to free up resources for health care and increased spending on the Kyoto environmental accord, he will need to wring some money from existing department budgets.

'I'm hoping that ministers are going to deliver up some reallocation,' he told the Canadian Press on Tuesday, adding that: 'I do have options - I can impose an efficiency charge in departments if that's what's required. But I'd rather departments sorted their own priorities.'

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