A modern personal tax on consumed income

At the time the 10-page Income War Tax Act was promulgated in Canada 100 years ago, the underlying principle was to tax Canadians on their “annual net gain, profit or gratuity:” capital gains from holding property would be exempt.However, 100 years later, this “annual income” approach is no longer appropriate. Consumption is now a more reliable tax base upon which to promote economic growth and fairness.The notion of taxing annual income was debatable, even in 1917. In response to a question on the taxation of real estate, Sir Thomas White, then-finance minister, responded:Two men, let us say, are employed by

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