Corporate tax cuts: Big costs but no job creation

Rabble.ca

By David Macdonald
Today the CCPA released a study that I authored which examines and debunks one of the biggest contentions of this campaign, that corporate tax cuts create jobs. One of the key reasons cited by the Conservatives for continued corporate tax cuts is that they are needed to encourage job growth.
To examine this contention, I took Canada’s biggest public companies, those on the S&P/TSX Composite and tracked them over the past decade to see how their taxes and profits changed. At the same time, I also tracked how many employees they had and therefore the number of jobs they created. These are the companies that benefit the most from corporate tax cuts because they declare the largest profits.
There were 198 companies that had data from 2000 through 2009. What readers should find shocking is just how dramatic the transformation in corporate taxation has been in the past decade. The effective tax rate for these successful companies has been cut in half. Imagine if, as an individual, your personal income taxes had been cut in half over the past decade. Well, that’s what happened in corporate Canada.
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