A truly fair tax system would recognize the growing inequality of wealth and income in Canada and would contribute to redistribution of income. We need a system that plugs loopholes and creates a new, higher tax bracket, say, 75 per cent on all taxable income over $250,000.
Taxing the rich would not harm the economy because our economic problems are not caused by a shortage of rich entrepreneurs. They are caused by a reduction in demand for ordinary goods and hence a reluctance by the private sector to invest.
Studies have shown that the income gap in Canada has grown dramatically over the past 30 years. The richest 10 per cent of families have enjoyed a 30 per cent increase in real earnings compared to a generation ago, whereas other income categories have been stagnant.