7 July 2023
1. To curb corporate profiteering and redistribute excess profits to the public
Research by Canadians for Tax Fairness and others has shown that large corporations have profited while households have faced higher prices everywhere from the grocery store to the gap pump. Even the government’s own committee recently recommended Canada bring in a windfall tax for grocery chains to disincentivize corporations from hiking profit margins by increasing prices.
2. To tackle inequality
When corporations profit and the public pays more, it widens the gap between the rich and poor. That gap has widened at a “record pace” according to the latest data from Statistics Canada. Corporate profits are making wealthy owners even richer. Executive compensation and dividends for shareholders are going up but that isn’t helping the economy – or equality. Revenue from a windfall tax should be used to strengthen social programs for Canadians, especially the most vulnerable households that have been hardest hit by inflation.
3. To restore fairness to the tax system
Corporations didn’t make their excess profits through innovation or hard work, but they did get richer by making life less affordable for Canadians. That money should be taxed back and invested in Canadians.
Many of Canada’s biggest and most profitable corporations are already paying record low rates of tax. C4TF research shows corporations avoided $30 billion in taxes in 2021 – the same year they reaped record profits while Canadians paid more for goods and services.
The government understands there is a need for a windfall tax in Canada. It has already brought in a windfall tax on banks and financial companies. That tax should be expanded to big corporations across all sectors.