FEDERAL-PROVINCIAL TAXATION IN TURBULENT TIMES

Major changes in federal tax policy over the last decade have added to the pressures on provincial public finances and resulted in increased interest in possible ways to restructure Canada's federal finances by reassigning taxes. I review several recent proposals along these line s, but conclude that on the whole major reassignments of taxes seem un likely to occur in the near future. The most important immediate issue concerns the possible revision of the much-criticized federal sales t ax, the GST. Although major substantive (as opposed to cosmetic) chang es in this tax seem either undesirable or unlikely, or both, some furt her, albeit still imperfect, rapprochement with provincial sales taxes may occur. Finally, I note that both the complexity and the importanc e of fiscal issues demand, but seldom receive, informed public discuss ion beyond the passing battles of current federal-provincial political relations.