IMPRINT, Friday, September 29, 1995
NEWS
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edge over their lifetime,” states a three-page summary of the lengthy proposal, (available from the Federation of Students Office). The final suggestion made in the CASA model involves the taxation of all university graduates in the workforce as well as corporations. It is generalized that these two groups stand to benefit most from higher level education. The document maintains that raising tuition fees is not an acceptable method of raising funds for universities and that new sources of funding must be found. More precisely, an Education Beneficiary Fund would be created to supplement tuition fees so that they would stay at their current level. Tuition will still increase with inflation but it is assumed the fund will prevent the dramatic sky-rocketing of tuition fees which has been expected by students for some time. The Education Beneficiary Fund is to be comprised of a Graduate Beneficiary Contribution and a Corporate Beneficiary Contribution. The fund will be collected via the aforementioned tax, but the money will not be rendered to the federal government. Instead, ajoint federal and provincial committee will be responsible for allocating the funds back into post-secondary education according to the performance indicators, on a project-funding basis. The tax rate will be levied between 0.5 and 1.75 percent, depending on the level of degree earned or the size of the corporation. For graduates, the tax will be charged on that portion of their income which exceeds the average yearly wage for non-university graduates, which is currently $21 Ooo. This means that if a graduate student earns $50 000 a year, $29 Ooo of that income is subject to the new tax. The summary explains that “The Corporate Beneficiary Contribution could take the form of a ‘pay-or-play’ tax upon corporations. Many companies already make donations to universities for scholarships, research and development, etc. and they should not be further punished by new taxes. On the other hand, there are a significant number of corporations with less [than] stellar records as corporate citizens who should be subject to such a tax.” If the plan is accepted by the federal government (an action still months or possibly years away), it will affect all university graduates currently in the work force. It is not limited only to students who graduate after the plan is implemented since such a limitation would make no difference in funding for the next 17 years. The taxing of a university education raises many questions which the obscure CASA document has not yet addressed. One issue involves domestic students who later migrate to the United States. In this case, these students benefit from lower tuition fees but don’t contribute to the Graduate Beneficiary Contribution. And foreign students, who already pay much of the full tuition costs, have been overlooked in the document altogether.
Another concern is that alumni donations will significantly decrease since these same alumni will be forced to contribute via the Graduate Beneficiary Contribution. It is expected that the Funds will contribute more money to university education than alumni donations, and there is no evidence yet to suggest that alumni will cease donating money to the university of choice. In contrast, the two Contributions are redistributed to all Canadian universities according to the performance indicators. The most poignant and feared concern is that the federal government will misuse the tax. Ironically, a student-based association is lobbying the federal government
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to impose a tax on university graduates. Once the tax is in place, there is no provision in the document to prevent the federal government from raising the rate beyond the 1.75% upper limit, or from completely eliminating transfer payments and making the Education Beneficiary Fund the primary source of funding for higher education. But the distribution of funds will be controlled by a joint committee comprised of both provincial and federal representatives. The money collected is to be wholly reinvested in education, as outlined in the proposal. The campaign has already be-
gun, but UW has not yet signed on, pending the council decision made on Wednesday. The referenda to be conducted at other institutions across Canada are scheduled on the same day, October 25, so as to gain publicity for the plan. The campaign has already gained support from various organizations including the Canadian Chamber of Commerce, the Canadian Labour Congress and Frank McKenna’s Liberals in New Brunswick. Even if students across the country accept the proposal, it does not denote acceptance of its recommendations by the federal govemment. If, however, the CASA proposal is approved, its effect will not
be limited to institutions who are members of CASA or its graduates. It will affect all universities and all graduates and all corporations across Canada. Copies of the paper are available at the Federation of Students office, or by calling Federation of Students President Jane Pak at extension 2478.
For the debate on this issue, see “Council kicks CASA ‘s mm, rFon page 5, Do not Pass Go. _