'Critical tax theory' wants white people to pay more tax. Let's stick to these guides for tax policy: efficiency, simplicity and fairness

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Imagine if in her Tuesday budget federal Finance Minister Chrystia Freeland announced higher taxes on capital gains — except for women, visible minorities and Black, LGBTQ and Indigenous Canadians. Most people would be appalled.

But woking up the tax system has many adherents. Just last week, I received emails from editors of two distinguished tax journals — Tax Notes, a leading U.S. publication, and the Canadian Tax Journal, seeking papers on “critical tax theory.” Are ethnically-specific taxes really something we should be considering?

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Mainstream tax theory argues the overriding objective of taxation is to raise revenue to cover the cost of public services. There are three main criteria for a “good” tax structure: efficiency, simplicity and equity.

Efficiency means taxes involve minimal distortion of economic activity: they raise revenue without inducing people to change their economic choices for tax reasons.

Tax equity has long been based on the twin notions of “horizontal equity” — people with the same incomes, consumption or wealth should pay the same taxes — and “vertical equity”: those with greater ability to pay should pay more.

Critical tax theory views tax........

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