"In this world nothing can be said to be certain, except death and taxes." - Benjamin FranklinThe fiscal cliff in the United States did not just endanger its own country's economy but the world's, including Canada's heavily dependent one. But in the American problem lies, at least partially, a Canadian solution: an estate tax.
The inability for Democrats and Republicans to prevent the fiscal cliff and the current uncertainty relating to the world's largest economy is threatening the fledgling global recovery.
Canada, a country whose economy is always extremely vulnerable to external crises, is now only more so. Being overly reliant on trade and declining commodity prices our northern nation is left unsure of future public revenue and with a growing record of deficit spending under this Conservative government, it should be.
Though the American fiscal cliff will potentially put Canada in recession, the potential crisis is offering one, albeit small, way out. This possible protection is just one policy of many under debate in the American legislature, an estate tax, that Canada, who is currently estate tax-less, could borrow and implement.
For Americans their current estate tax or death tax has been a component of their tax system since 1916, acknowledging its necessity, present fiscal cliff negotiations are only considering changes to its scope, currently applying to inheritances over $5 million.
Besides providing guaranteed revenues, the millennia-old tax on extreme wealth transferred after death provides one of the most efficient ways of creating a more egalitarian society. Progressive parties would not just be wise to adopt such a policy on principle but also on strategy. Conservatives would be seen as the party of the rich in opposing a tax only on the highest of high inheritances.
Canada should begin to take steps against this current economic instability, at least domestically. And if Benjamin Franklin was right that only death and taxes are certain, with stable revenue from an estate tax, Canada's continued deficits would be the only things left to doubt.