By contrast, President Donald Trump is proposing to lower income taxes for many Americans by reducing the number of brackets from seven to four. “A lower base in 2016 will translate into lower revenues in 2017 as well, since revenues are grown from a lower base,” he said. “For 2017-18, this is about a five-per-cent unexpected personal income tax revenue shortfall, which is huge. Since no explanation is provided, tax planning is the likely culprit.”It’s not yet clear whether the phenomenon of lower income tax revenues in growing economies is widespread and sustained — Nova Scotia saw a marginal dip in income tax receipts last year between estimated and actual returns. The Ontario fiscal update suggests that the taxable base may have shrunk already, which will likely mean reduced personal income tax revenues at all levels of government.

Source: National Post November 21, 2017 00:11 UTC