Well, Canadians are finally headed to the polls after enduring a lame duck government, capped by a newly anointed Prime Minister whose recent policy reversals reek more of opportunism than leadership.

At the time of writing, neither the Liberal Party nor the Conservatives have released their full election policy platforms.  When they do, you can be sure that tax geeks like me will be poring over the details to compare and contrast the proposed taxation policies.

However, shortly after the election call on Sunday, Mr. Carney, the Liberal leader and PM, did announce a proposed 1% personal tax cut for the bottom personal tax bracket should he get elected.  And Pierre Poilievre, leader of the Conservative Party announced a 2.25% personal tax cut for that same lowest bracket on Monday morning.  A reminder for tax practitioners and other interested parties: this means that all personal tax credits would be at 14% for the Liberals or 12.75% for the Conservatives instead of the usual 15% (with the exception of donations in excess of $200) unless there is a plan to avoid that.

Mr. Carney and Conservative leader, Pierre Poilievre are significantly different.  Having said that, Mr. Carney seems to have no shame lately in copying taxation policy proposals from the Conservatives.  Recent announcements by Mr. Carney about eliminating GST on certain new housing builds, the “cancellation” of the capital gains proposals, the elimination of the consumer carbon tax and now a personal tax reduction are all signature previous policy announcements from the Conservatives.  The celebration by the Liberal Party about these announcements is a master class in hypocrisy and short-term memory.

Given the “newness” of Mr. Carney’s leadership, let’s unpack what we can expect from many of his policies, especially taxation.

But let’s first discuss his leadership credentials.  While Mr. Carney likes to brag that he was born in the NWT and grew up in Edmonton, AB, such facts don’t make one more empathetic to the average Canadian’s struggles to put food on the table.  In Mr. Carney’s situation, his entire career has been carried out in the halls of central banks, advisory positions with various governments, the U.N. and lately in the boardroom of one of Canada’s largest companies (which he was part of the executive team that made the decision to move its headquarters from Canada to the U.S.).  Carney’s world of central banks and corporate boardrooms feels distant from the daily grind of most Canadians.

On a personal note, I have worked with some of the most credentialed and well experienced people over my long career.  Do those credentials make one automatically well suited to lead?  And to lead a country?  Hardly.  Many of those excellent professionals make poor leaders.  Leadership is a complex art and science that takes years and years of practice and improvement to be good at.  Without such practice and a self awareness of the need for empathetic personal growth, I have found that many in this group of people turn arrogant rather than evolve into good leaders. Recent press conference examples from Mr. Carney seem to indicate that he might fall into that latter camp.

While many are hailing Mr. Carney’s educational achievements and impressive career positions as a moment of economic credibility and a savior of the Liberal Party, the reality of his “achievements” is far less inspiring.  Carney’s track record, writings and speeches suggests a future of big government, more income / wealth redistribution, and policies that prioritize climate ideology over economic growth should the Liberals get elected.

Peeling the onion back a bit more, Carney’s tenure as governor of the Bank of Canada (2008-2013) and later the Bank of England (2013-2020) has shown him to be a big believer in government-led economics.  In particular, during his time in the U.K., he pushed for aggressive climate related financial regulations which, of course, comes with increased compliance burdens and costs. His policies supported excessive government stimulus spending combined with low interest rates which ultimately did nothing to deal with productivity challenges.

He has repeatedly emphasized redistribution over wealth creation which, again, signals a preference for government intervention over free markets.  With Carney’s preference for large government intervention, one can expect more taxes, regulation, government bloat and economic intervention.  Will we see tax reform?  Highly doubtful.

If you liked the Trudeau government’s tax-and-spend, debt-fueled approach, you’ll love Carney’s Canada because it’s likely going to be more of the same, but with a slicker presentation. For example, Mr. Carney’s proposal to separate “capital” amounts from the “operational budget”, an old accounting trick designed to hide increased spending, is slick and non-transparent. Mr. Carney is a bureaucrat’s dream.  And a taxpayer’s nightmare.

With the above in mind, I expect the Liberals’ upcoming policy platform to feature more spending and targeted tax hikes. Their targets? The usual bogeymen—wealthy Canadians or ‘climate-killing’ businesses. Or the introduction of some other politically motivated tax measures which the current Prime Ministers Office is famous for.

What I’ll be looking for is taxation and economic policies that:

• Puts money back in the pocketbooks of hard working and average Canadians;
• Enable and encourage entrepreneurs and large businesses to expand and re-invest in Canada;
• Encourage less government, not more, so our country’s excellent entrepreneurs – and budding new ones – feel empowered and emboldened to risk and invest capital to create jobs for the benefit of our country;
• Encourage successful Canadians to want to stay in Canada, invest in Canada and not leave;
• Attracts other successful people and businesses from around the world to invest in Canada to help create jobs and benefits for all;
• Simplifies the tax system so as to encourage Canadians to truly understand their tax affairs and help improve their overall financial literacy;
• Promotes interprovincial free trade, eliminating unnecessary barriers that make it harder for Canadian businesses to expand across our country;
• Encourages savings and investment through tax incentives, such as expanded TFSA contribution limits or creative use of such plans to make housing purchases more approachable;
• Reins in government spending to reduce deficits and debt (and doesn’t encourage budgeting exercises proposed by Mr. Carney that will encourage hiding spending in plain sight), ensuring future generations aren’t burdened with today’s reckless fiscal policies; and
• Of course, policies that encourage tax reform with “big bang” ideas to unlock growth and help to improve productivity.

As Milton Friedman warned, ‘When government – in pursuit of good intentions – tries to rearrange the economy, legislate morality, or help special interests, the costs come in inefficiency, lack of motivation and loss of freedom.”

That’s the choice Canadians face: a nation of ambition and prosperity, or one stifled by bureaucracy and mediocrity.  The answer will determine whether Canada returns to a competitive, prosperous nation—or whether we continue down the path of economic mediocrity.