Topp's NDP leadership platform includes tax hikes

Brian Topp is boldly going where most Canadian politicians fear to tread: promising to make the wealthy pay more in taxes.

The perceived frontrunner in the NDP leadership race wants his party to make higher income taxes for high-income earners a key plank in its next election campaign platform.

He told The Canadian Press he intends to unveil a detailed proposal in the weeks to come.

"I will be talking about income taxes and I think it's time for our party to step up to that plate and to be pretty clear about that because then we'll have a mandate to act if we're elected," Topp said in a wide-ranging interview.

He also called for a hike in corporate taxes and did not rule out a sales tax increase "at some point," once the fragile economy is on surer footing.

But it's been decades since any Canadian politician dared talk about raising income taxes. Indeed, since the 1990s, taxes have been steadily reduced and parties have competed for the title of biggest tax slasher.

Income tax hikes more fashionable?

The notion of making the rich pay more has gained currency recently as debt crises in the United States and Europe threaten to tip the world into another deep global recession.

U.S. President Barack Obama last month proposed $1.5 trillion in new taxes aimed primarily at the wealthy, including setting a minimum tax on those making $1 million or more in annual income. The latter measure has been dubbed the "Buffett rule," after billionaire investor Warren Buffett, who has railed against the fact he pays a lower rate of tax than his secretary.

The yawning gap between rich and poor has also been at the root of the "Occupy Wall Street" movement, which spawned protests last week in Canada and around the world.

According to Statistics Canada, the top one per cent of Canadian earners took home 11 per cent of total income in 2009.

Topp said the billions in tax breaks for profitable corporations and  wealthy individuals would be better spent on helping people who are struggling to get by.

"I think the goal of aiming for the lowest corporate taxes in the industrialized world is feckless," he said, adding that "there are many other things that are more important first," including health care, social housing, public transit and municipal infrastructure.

"This is a grossly inefficient expenditure of public money on a completely inappropriate priority ... I think tax expenditures aimed at high-income individuals are another inappropriate priority and some of those expenditures should be redeployed."

Topp, a former party president and key architect of NDP electoral gains under late leader Jack Layton, did not define what he means by high-income earners. Nor would he elaborate on how much more he's prepared to make them, or corporations, pay.

He said he's currently "putting the finishing touches" on some policy statements which will address those issues "in some detail." However, his use of the term tax expenditures suggests he's looking at eliminating some of the exemptions aimed at wealthy Canadians.

Taking reporters' questions at an announcement today in Ottawa, Finance Minister Jim Flaherty scoffed at Topp's suggestion that the wealthy should pay more in taxes.

"He probably needs to study the Canadian tax system," Flaherty said, noting that most income tax in Canada is paid by the middle class. "If anyone thinks in the United States, Canada, [or] Europe, you can tax the one per cent or 0.5 per cent [most wealthy] and raise a lot of money, it's nonsense. It doesn't produce the volume of revenue that you need in order to run a country."

"It's one of those dreamy ideas that people think about that don't make any sense," Flaherty concluded.

Flaherty also dismissed Topp's suggestion of raising the corporate tax rate, noting that officials from other countries tell him how lucky he is to be Canada's finance minister during challenging economic times around the world.

Flaherty suggested recent decreases in the corporate tax rate have helped Canada's economy fare better. "The last thing I'm going to do is screw up those fundamentals," Flaherty said. "Our brand is sterling."

Ready to fight Tories

Topp's frank views on taxes risk giving ammunition to Prime Minister Stephen Harper's Tories, who delight in casting the NDP as wild-eyed socialists who would break the national treasury and ruin the economy. 

But Topp said it's the Tories who "engineered" much of Canada's current financial woes by "over-exuberantly over-investing in tax benefits for profitable companies and for high-income individuals, who are folks who don't need help in this economy."

He said the key to winning the next election will be proving that the NDP can be fiscally prudent economic managers while meeting the challenges of health care, climate change and restoring Canada's "good name in the world."

Topp stressed his own credentials on that score, saying he's driven by his  "searing experience" as deputy chief of staff to former Saskatchewan NDP premier Roy Romanow. He recalled how Romanow, having inherited a province teetering on the brink of bankruptcy, was forced to plead with bond traders not to downgrade the province's bonds.

He recounted meetings with "20-year-old bond analysts" who questioned the amount of money the Romanow government was spending on health care.

"At that moment, that kid had as much power over health policy in Saskatchewan as our legislature did. That cannot be permitted to happen and no committed social democrat will let the public interest be enslaved to debt as our (Conservative) predecessors in Saskatchewan did."

The Tories will undoubtedly launch a smear campaign against Topp should he win the March 24 leadership vote. They used such campaigns to successfully demolish the past two Liberal leaders, Stephane Dion and Michael Ignatieff, and have already started painting the NDP in general and Topp in particular as a puppet of big unions.

But Topp maintained that responding in kind to the Tories' hyper-partisan mudslinging is precisely the wrong approach. The Liberals tried it, he noted, and were reduced to a third-party rump.

In his view, the Tories' strategy is aimed at energizing their own base while so disgusting other Canadians that they don't bother to vote. The best way to counter that is to "offer a much more hopeful and optimistic vision of the future" -- much as the late Jack Layton did in last spring's campaign, with historic results.

Rival camps have dubbed Topp the "establishment candidate" in reference to his imposing list of endorsements from NDP luminaries, including former leader Ed Broadbent and Romanow.

But Topp said it's a moniker he's proud to accept.

"If by establishment candidate we mean that I worked on the Layton team and that we're the folks who took the party from 13 seats to 103 and moved the vote (share) from eight (per cent) to 30, then I plead guilty to being in that establishment. And I think that (more positive) approach to politics I just described is what we need to keep working with."

Nor did he make any apologies for his close ties to trade unions. Topp is a former senior executive with the cinema, television and radio artists' union in Toronto.

"If it wasn't for the labour movement, we'd all still be going to work at (the age of) seven."

On other issues, Topp said:

- New Democrat MPs should not be allowed a free vote on a soon-to-be-introduced government bill to scrap the controversial long gun registry, an issue that's split the NDP caucus along rural-urban lines in the past. "The fact of the matter is, the money has been spent, the registry is here, police services are using it, the public overwhelmingly supports it, there's no compelling case for dismantling it that isn't emotional," he said. There is precedent in our party for letting people sit out a vote. But I could not support arrangements in which members of our caucus vote with the government on this bill. - The Constitution needs to be reopened some day to finally secure Quebec's signature on the document. But he said that shouldn't be attempted unless the "winning conditions" are present to ensure the effort won't result in another failure like the Meech Lake or Charlottetown constitutional accords. It's not a dead file but it's not a file we'll stick our toe into before we know it's going to work. It's not the role of a federal leader to be a sorcerer's apprentice. - He will run for a seat in the Commons whether or not he wins the leadership. He "mildly favours" running in Toronto, where his two teenaged sons want to continue attending their current high school. Whether he'd run in Layton's vacant Toronto-Danforth riding depends on whether Harper calls a byelection before the leadership race is over.