Why Durham wants taxes

Just a few pages later one gets Durham's assessment of the previously described (somewhat anemic) revenue stream:

This immunity from taxation has sometimes been spoken of as a great privilege of the people of Lower Canada, and a great proof of the justice and benevolence of their government. The description which I have given of the singularly defective provision made for the discharge of the most important duties of both the general and the local government will, I think, make it appear that this apparent saving of the pockets of the people has been caused by their privation of many of the institutions which every civilized community ought to possess. A people can hardly be congratulated on having had at little cost a rude and imperfect administration of justice, hardly the semblance of police, no public provision for education, lighting, and bad pavements in its cities, and means of communication so imperfect, that the loss of time, and wear and tear caused in taking any article to market, may probably be estimated at ten times the expense of good roads.

It seems that Durham might have been an early supporter of something approximating our contemporary welfare state.

Government revenue in Canada before Canada was Canada

Because I have already introduced the concept of municipal finance today, it seems appropriate for me to also include what Durham had to say about the source of government revenue in the 1830s

With the exception of the small amount now derived from the casual and territorial funds, the public revenue of Lower Canada is derived from duties imposed, partly by imperial and partly by provincial statutes. These duties are, in great proportion, levied upon articles imported into the Colony from Great Britain and foreign countries; they are collected at the principal ports by officers of the Imperial Customs.

At the time of the writing of the report the total revenue collected was about £100 000.

My how things have changed since those old pre-income tax and pre-welfare state days.

Gold Star Idea

Municipalities always seem to complain about not having enough money and that they are forced to rely almost exclusively on things like property tax as a revenue source.

I think I have a solution to this problem that would also be fun and engaging for the entire community.

The idea is for them to stop collecting property tax and instead start holding regular, semi-mandatory fifty-fifty draws. For example, each former tax payer might have to kick in a few hundred bucks to the fifty-fifty pool (in lieu of paying taxes). Of course, they would be welcome to top that up to any level they would like. Also, people who are currently not paying municipal taxes, like renters, would be welcome to participate. Even people from outside the municipality proper would be welcome to participate and as the pot would be seeded, so to speak, the interest from outside gamblers is sure to be huge (a la Powerball). The millions are sure to start rolling in almost overnight.

You may say that reputable organizations don't hold fifty-fifty draws to raise funds. That I would respond by giving you the NHL's Calgary Flames, holders of a regular fifty-fifty draw. It is almost hard to imagine a more reputable organization.

You may wonder if a person's chance to win big can be used for more social or beneficial purposes. It would seem that, at least as far as bank accounts are concerned, there is some evidence of this being possible. Some people, it seems, are more engaged in saving money when such an action results in a chance to win big. Would this trend not hold when it comes to paying municipal taxes? Won't people pay more tax so they have a chance at that sweet prize pool?

All in all it seems that the case for this proposal is pretty strong. Come on Halifax and St. John's, why don't you give this a shot? It has to be better than whatever you have going on right now.

Editor's Note: I should probably credit a recent Freakonomics Podcast episode as being at the core of some of these ideas (though I think I have modified them enough to call them my own - and I wasn't explicitly thinking about it at the idea development phase). Only after coming up with this idea I learn that even they are familiar with the idea of a tax lottery.