Freedom Flyer 5

Sir: In a recent mailer to Ontario voters, Bob Rae, leader of the provincial NDP, makes the following statement: "Did you know that in 1981 more than 3,000 people in Ontario who made over $100,000 didn't pay a cent in income tax? And that you can earn up to $41,000 in dividends and pay no tax?"

This insinuation of injustice reveals a dark side to the elective process: the growing tendancy of politicians of every stripe to tell just enough of the truth to create a totally false impression. Here are the facts that Rae chooses to ignore:

1. Business losses of prior years, since they represent the loss of dollars on which tax was paid previously, can quite properly be written off in another year.

2. Tax on income earned in the United States might be paid directly to the U.S. IRS and might not appear in Revenue Canada statistics.

3. Tax on the $41,000 is paid by the corporation; the dividend tax credit is simply a way of ensuring that the shareholder who ultimately gets the dividends does not end up paying tax again on the same dollars. Surely, even Rae would have to cry "foul" at any hint of double taxation.

4. Alimony payments are taxable in the hands of the recipient and are therefore deductable from the income of the ex-husband.

5. The 3,000 people referred to represent only about two or three per cent of the total for that tax bracket.

There are probably many more reasonable, logical and equitable ways in which taxable income may be reduced. All the above information is well known to any tax lawyer or accountant. It is unfortunate that reporters do not include such information in pertinent news items. It would eliminate much pointless controversy.

Rae goes on to accuse the big corporations and wealthy people of getting a free ride at the expense of others. Has he forgotten that, despite opposition from lovers of freedom of expression, there is now on the books a law which makes it a criminal offence to incite hatred of any identifiable group?

Here's a bit of hard cheese for Rae to nibble on: Jobs are created by the rich, or by those who are on their way to becoming so. Example: In the early '70s, a small, three year old company named Intel had a breakthrough in the field of microprocessors; five years later, the original staff of 12 had grown to 8,000, scattered all over the globe. In other words, Intel, in the process of creating all those jobs, had become a multinational corporation, the very organization socialists so love to hate.