[rugatika]

Originally Posted by silverdoctor

Let me put this into pure and simple economics 101.

You have a job - you pay federal and provincial income taxes.
You buy a vehicle - you pay taxes on it.
You buy gas - you pay taxes on that fuel.
you buy cigarettes or booze - you pay taxes on that.
You buy anything in the stores - you pay GST.
There's hundreds of other things that are taxed, but you get the picture.
The higher the population, the more people to buy things, the more taxes go into the kitty.

Now, what happens to all those taxes you ask? They go into the federal governments bank account and they are called general revenues.

Make sense yet?

Now, out of that money, the federal government starts paying back to the provinces. Equalization payments come out of the general revenue. So do transfer payments for health care, infrastructure revenues, whatever. Etc, etc, etc.

That's simple economics.

I have to ask. Did you ever take Economics 101??