Business
Indigenous Broadband – Connecting the North
![](https://www.todayville.com/wp-content/uploads/2020/05/tvca-tvca-indigenous-broadband-connecting-the-north--2020-05-27.jpg)
In our digitally defined world, access to technology is an important factor in achieving a high quality of life for many. The digital divide refers to differences in access to technology experienced by individuals as a result of various socioeconomic and geographical factors. In Canada, a major feature of the digital divide is location, with a major gap existing between the sparsely populated Northern territories and the rest of the country.
The lack of access to reliable Internet in rural areas across Northern Canada can make it extremely difficult for those living in remote communities to remain connected, conduct business, access necessary resources and more. The absence of reliable connectivity for our Northern neighbors has been an ongoing problem since the inception of the Internet, but countless discussions and grants have yet to yield a serious, sustainable solution.
KatloTech Communications Ltd. (KTC) is a Northern-Indigenous owned business based in Yellowknife, NWT committed to solving the broadband issue that has plagued Northern Canada for years. The organization’s mission is to close the digital divide in Northern Canada by providing world-class telecommunication solutions through the use of wireless and fiber optic technologies.
Their Broadband Investment Project in the Northwest Territories, currently in the planning and investment stages, seeks to “build and deploy an indigenous-owned next-generation fiber-optic network infrastructure connecting the Northwest Territories into Global Markets.” The network will have the ability to host services such as Internet, Cloud Services, IP telephone services, cellular and digital TV services and offer wholesale broadband access to providers and resellers.
“People in the North have been waiting for this for years,” says Lyle Fabian, President KatloTech Communications, “finally we decided, if no one else is going to build it, we will!”
The low population density in Northern Canada does not attract the same number of telecommunication providers as southern regions of the country. This has led to a lack of competition between providers in the north, contributing to the creation of a predatory market atmosphere where clients are paying outrageous prices for access to basic services. “Our goal is to innovate the North,” says Fabian, “as soon as you leave major city centers, choice of access is almost non-existent. We want to create competition and give everybody choices.”
Like countless other organizations across the country and the world, COVID-19 has forced KatloTech Communications to reevaluate their plans for 2020. However they remain entirely committed to the cause. KatloTech is currently focused on raising public awareness for their project and furthering discussions with third party organizations interested in bridging the divide and bringing reliable connectivity to the North.
For more information on KatloTech Communications Inc., visit https://katlotech.ca/
For more stories, visit Todayville Calgary.
Business
Federal government’s ‘fudget budget’ relies on fanciful assumptions of productivity growth
![](https://www.todayville.com/wp-content/uploads/2024/04/tvrd-fi-trudeau-image-2024-04-24.jpg)
From the Fraser Institute
By Niels Veldhuis and Jake Fuss
Labour productivity isn’t growing, it’s declining. And stretching the analysis over the Trudeau government’s time in office (2015 to 2023, omitting 2020 due to COVID), labour productivity has declined by an average of 0.8 per cent. How can the Trudeau government, then, base the entirety of its budget plan on strong labour productivity growth?
As the federal budget swells to a staggering half a trillion dollars in annual spending—yes, you read that correctly, a whopping $538 billion this year or roughly $13,233 per Canadian—and stretches over 430 pages, it’s become a formidable task for the media to dissect and evaluate. While it’s easy to spot individual initiatives (e.g. the economically damaging capital gains tax increase) and offer commentary, the sheer scale and complexity of the budget make it hard to properly evaluate. Not surprisingly, most post-budget analysts missed a critically important assumption that underlies every number in the budget—the Liberals’ assumption of productivity growth.
Indeed, Canada is suffering a productivity growth crisis. “Canada has seen no productivity growth in recent years,” said Carolyn Rogers, senior deputy governor at the Bank of Canada, in a recent speech. “You’ve seen those signs that say, ‘In emergency, break glass.’ Well, it’s time to break the glass.”
The media widely covered this stark warning, which should have served as a wake-up call, urging the Trudeau government to take immediate action. At the very least, this budget’s ability—or more accurately, inability—to increase productivity growth should have been a core focus of every budget analysis.
Of course, the word “productivity” puts most people, except die-hard economists, to sleep. Or worse, prompts the “You just want us to work harder?” questions. As Rogers noted though, “Increasing productivity means finding ways for people to create more value during the time they’re at work. This is a goal to aim for, not something to fear. When a company increases productivity, that means more revenue, which allows the company to pay higher wages to its workers.”
Clearly, labour productivity growth remains critical to our standard of living and, for governments, ultimately determines the economic growth levels on which they base their revenue assumptions. With $538 billion in spending planned for this year, the Trudeau government better hope it gets its forecasts right. Otherwise, the $39.8 billion deficit they expect this year could be significantly higher.
And here’s the rub. Buried deep in its 430-page budget is the Trudeau government’s assumption about labour productivity growth (page 385, to be exact). You see, the Liberals assume the economy will grow at an average of 1.8 per cent over the next five years (2024-2028) and predict that half that growth will come from the increase in the supply of labour (i.e. population growth) and half will come from labour productivity growth.
However, as the Bank of Canada has noted, labour productivity growth has been non-existent in Canada. The Bank uses data from Statistics Canada to highlight the country’s productivity, and as StatsCan puts it, “On average, over 2023, labour productivity of Canadian businesses fell 1.8 per cent, a third consecutive annual decline.”
In other words, labour productivity isn’t growing, it’s declining. And stretching the analysis over the Trudeau government’s time in office (2015 to 2023, omitting 2020 due to COVID), labour productivity has declined by an average of 0.8 per cent. How can the Trudeau government, then, base the entirety of its budget plan on strong labour productivity growth? It’s what we call a “fudget budget”—make up the numbers to make it work.
The Trudeau fudget budget notwithstanding, how can we increase productivity growth in Canada?
According to the Bank of Canada, “When you compare Canada’s recent productivity record with that of other countries, what really sticks out is how much we lag on investment in machinery, equipment and, importantly, intellectual property.”
Put simply, to increase productivity we need businesses to increase investment. From 2014 to 2022, Canada’s inflation-adjusted business investment per worker (excluding residential construction) declined 18.5 per cent from $20,264 to $16,515. This is a concerning trend considering the vital role investment plays in improving economic output and living standards for Canadians.
But the budget actually hurts—not helps—Canada’s investment climate. By increasing taxes on capital gains, the government will deter investment in the country and encourage a greater outflow of capital. Moreover, the budget forecasts deficits for at least five years, which increases the likelihood of future tax hikes and creates more uncertainty for entrepreneurs, investors and businesses. Such an unpredictable business environment will make it harder to attract investment to Canada.
This year’s federal budget rests on fanciful assumptions about productivity growth while actively deterring the very investment Canada needs to increase living standards for Canadians. That’s a far cry from what any reasonable person would call a successful strategy.
Authors:
Alberta
Alberta government should create flat 8% personal and business income tax rate in Alberta
![](https://www.todayville.com/wp-content/uploads/2024/04/tvrd-fi-worker-oil-rigger-alberta-energy-image-2024-04-23.jpg)
From the Fraser Institute
By Tegan Hill
If the Smith government reversed the 2015 personal income tax rate increases and instituted a flat 8 per cent tax rate, it would help restore Alberta’s position as one of the lowest tax jurisdictions in North America
Over the past decade, Alberta has gone from one of the most competitive tax jurisdictions in North America to one of the least competitive. And while the Smith government has promised to create a new 8 per cent tax bracket on personal income below $60,000, it simply isn’t enough to restore Alberta’s tax competitiveness. Instead, the government should institute a flat 8 per cent personal and business income tax rate.
Back in 2014, Alberta had a single 10 per cent personal and business income tax rate. As a result, it had the lowest top combined (federal and provincial/state) personal income tax rate and business income tax rate in North America. This was a powerful advantage that made Alberta an attractive place to start a business, work and invest.
In 2015, however, the provincial NDP government replaced the single personal income tax rate of 10 percent with a five-bracket system including a top rate of 15 per cent, so today Alberta has the 10th-highest personal income tax rate in North America. The government also increased Alberta’s 10 per cent business income tax rate to 12 per cent (although in 2019 the Kenney government began reducing the rate to today’s 8 per cent).
If the Smith government reversed the 2015 personal income tax rate increases and instituted a flat 8 per cent tax rate, it would help restore Alberta’s position as one of the lowest tax jurisdictions in North America, all while saving Alberta taxpayers $1,573 (on average) annually.
And a truly integrated flat tax system would not only apply a uniform tax 8 per cent rate to all sources of income (including personal and business), it would eliminate tax credits, deductions and exemptions, which reduce the cost of investments in certain areas, increasing the relative cost of investment in others. As a result, resources may go to areas where they are not most productive, leading to a less efficient allocation of resources than if these tax incentives did not exist.
Put differently, tax incentives can artificially change the relative attractiveness of goods and services leading to sub-optimal allocation. A flat tax system would not only improve tax efficiency by reducing these tax-based economic distortions, it would also reduce administration costs (expenses incurred by governments due to tax collection and enforcement regulations) and compliance costs (expenses incurred by individuals and businesses to comply with tax regulations).
Finally, a flat tax system would also help avoid negative incentives that come with a progressive marginal tax system. Currently, Albertans are taxed at higher rates as their income increases, which can discourage additional work, savings and investment. A flat tax system would maintain “progressivity” as the proportion of taxes paid would still increase with income, but minimize the disincentive to work more and earn more (increasing savings and investment) because Albertans would face the same tax rate regardless of how their income increases. In sum, flat tax systems encourage stronger economic growth, higher tax revenues and a more robust economy.
To stimulate strong economic growth and leave more money in the pockets of Albertans, the Smith government should go beyond its current commitment to create a new tax bracket on income under $60,000 and institute a flat 8 per cent personal and business income tax rate.
Author:
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