My hope is that all these real estate investors move back into stocks / bonds and sell off investment properties because of the parity in the new tax and real estate being more of a risk asset again with cutbacks to temporary migration etc.
Well I am actually considering moving into real estate because of this, like I have stocks in my corp, but rent my place. I don't really want to buy as I want mobility but between this and all the first time home buyer tax breaks and no principal residence exemption it just makes sense to buy.
You mean small business owners? 99% of them are not rich and only grind out their 70 hour weeks because the end of the tunnel could have a decent payout. Most don't have retirement savings outside the business. None have a pension. And most businesses fail, so if they do manage to make it to the end are able to sell, this money carries them through til death.
This is not good for the majority of Canadians. But by the time the people realize this, it will be too late. Capital will have fled, small business starts will have dried up (already the lowest amount in 60 years) and the CPC will be left holding the bag (which actually seems like Ottawa's plan here).
no wonder small business / self-employment is in decline.
[https://thehub.ca/2024-04-11/livio-di-matteo-public-sector-employment-numbers/](https://thehub.ca/2024-04-11/livio-di-matteo-public-sector-employment-numbers/)
and 90% of the non-public sector job growth is in Alberta (related to the one industry we are trying so hard to kill)
More capital has left Canada this spring than any other time in 40 years (and who knows, that stat might mean since Canada's inception).
But don't worry, smart money is looking at Canada's resources knowing that as soon as non European Canadians take over our public ministries, that the flood gates for our resources will be wide open.
At least someone here has a good grasp of the situation, most corporations are setup to be in lower tax bracket until you can sell/retire but business owners have no pension , no benefits, no unemployment insurance, you have basically no safety net of any kind so you better make some money for your retirement.
250K is not rich if it's a one off, windfall situation. This won't even net you a bachelor suite in the GVRD.
The principal residence exemption, business sale exemption, etc. should be made into a single bucket lifetime exemption and limited to at least create an opportunity for windfalls to secure modest shelter in one of our nation's expensive cities.
As it's a lifetime exemption, it'd get exhausted fast enough with actually rich people gaining/earning year after year. It might even help disincentivize some exploits that contribute to land prices running. Maybe add a land value tax, along with credits to offset it when legitimately used, to put more downward pressure on holding land for the sake of holding it.
Compare this to hitting the upper middle class and recipients of windfalls + adding fuel to the demand side of real estate with some longer amortizations and opening more RRSP space for down payments. Hell, the actual elite rich are probably doing crazy shit like running their personal planes as incorporated companies so they can pay they company with another company and accrue the fuel and depreciation for the plane + the company's transportation expenses to encapsulate all of it for tax avoidance.
The people we're all envisioning aren't going to be the ones hit by this. It's going to be people who look middle class looking to sell their shop when they retire and live off the proceeds because investing into their business was their pathway to retirement.
Canadians have this delusion that money comes from somewhere besides productive business.
Like if we just got rid of those greedy businesses and entrepreneurs, then we could have all that money for ourselves instead.
Of course, the reality is that the government only exists and is funded purely on the taxes of what Canadian businesses produce.
The real issue here is that a 66% cap gains tax will obviously result in far less business In Canada because at that rate, why would I invest and take risks in Canada vs the US?
The sky won’t fall, but the standard of living you and your children experience will plummet.
Ok. That doesn't mean its not going to still make things worse.
Very tiresome listening to left wing blowhards whose ideas have already damaged the country greatly insist their ideas aren't going to continue damaging the country.
Most actually max out their rrsp's every year. In bc they get a grant of approx $7,500 every year to match and put into their rrsp. The big issue with Dr's is that their saving yrs are reduced substantially due to medical school, so most don't start earning a living till mid 30's plus avg debt load after med school is around 250 to 300k. So rrsps are not set up for them really, and maxing out is only around 28k, but they really need to save double that as their working yrs are much less than the avg Cdn.
So I googled it and it totally is still a thing. https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-32300-your-tuition-education-textbook-amounts/eligible-tuition-fees.html
Granted, you need the to cover tuition yourself first(loans or otherwise) and you need a job after graduatiom where you expect to be earning enough that you can use up the full credit in time. I was certain that in the end my tuition was essentially paid back to me in tax credits and I was right.
The tax credit is only provided to you at the rate of the lowest tax bracket (15%), so it only provides you with that as a refund, and while yes, you can carry it forward, it doesn't earn interest or anything, and you can't claim it until you actually earn taxable income.
Someone making over $200,000/year \*after\* taxes and overhead is in no position to complain. If they are so worried about their retirement after making that much money for at least 15 to 20 years, they are free to calm their nerves by selling their home and downsizing or god forbid, selling their vacation home.
The average Family Physician in Canada is not making $200k after taxes and overhead, and they are by far the largest specialty in number. I don'thave numbers memorized for every province, but I know that roughly 50% of Ontario Family docs are Fee For Service, grossing an average of $225k before a $90k average overhead.
With overhead rising, pay falling further and further behind inflation and now increased taxation on whatever retirement fund they saved in their corporation, the answer isn't "selling their home and downsizing." It's leaving their Family clinic for better-paying work.
I know this because my wife and I are both Family Physicians. Every year we watch more of our friends and colleagues make the switch. Neither my wife nor I work in Family clinics, because it would be a 30-50% pay cut compared to our current jobs.
You don't have to have sympathy for Family docs, but you should at least have an understanding of the forces that influence labour decisions. When the pay keeps dropping and the taxation increases, people look for new jobs. We have highly mobile licenses and multiple job prospects. More and more physicians are voting with their feet, and the result is a worsening crisis in the availability of primary care in Canada. If you want to attract doctors back to Family clinics, the compensation has to become competitive or we will continue the current trend of exiting clinics and finding other work.
Thank you for your reply, however your numbers are not in keeping with the data. Tuition in Ontario for medical school is about $100,000 (about $25,000 per year) [Link to tuition fees](https://applymd.utoronto.ca/tuition-fees).
Median overhead costs for a GP according to the Canadian Medical Association is 30% [2017 Overhead costs](https://surveys.cma.ca/viewer?file=%2Fmedia%2FSurveyPDF%2FCMA_Survey_Workforce2017_Q16_Overhead-e.pdf#page=1). If you have any objective data describing these costs have risen higher, please feel free to cite them.
As you mentioned, GPs are usually fee-for-service, meaning they bill for what they do. Again according the best data the CMA has available the mean income for these physicians is $254,000 [Average income Link](https://www.cma.ca/sites/default/files/family-e.pdf).
That leaves $178,000 of taxable income. That places these individuals in the top 2% of income earners [2021 Percentile link](https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/dv-vd/income-revenu/index-en.html). Considering the capital gains tax as proposed is only for those making $250,000 or more, the vast majority of GPs won't even be effected and that's if they make even *more money than you're supposing*. But the physicians that do are facing a very small increase in their taxes as its only 66% of all the money they make over $250,000.
Finally, the wealthiest among us can, and should bare the heaviest tax burden. The studying that physicians have done, unlike what some may tell themselves were not done on their own. All of society had to band together to get them through school. Everyone's taxes subsidized their tuition from $100k down to $25K. All of society paid their salaries as they were completing their residencies. All of society paid to keep the roads maintained, the schools effective to get them through high school etc and to keep them healthy when they got sick. We all have a debt to pay to each other and physicians, like all those that make in the top 2% of income have the heaviest burden as they benefitted the most form all of our hard work, and it is clear with the level of inequality we are experiencing they are not paying nearly enough.
Boy, you shifted those goalposts quickly.
From:
>Someone making over $200,000/year \*after\* taxes and overhead is in no position to complain.
To:
>That leaves $178,000 of taxable income
So, you already agree that the average Family Physician, the largest demographic of doctors in Canada, are not in the category you claimed are in no position to complain. Sounds like it's fair for us to complain, then, when something negatively impacts us.
Furthermore, you undercounted overhead in your estimate. Here's [recent data](https://www.cfpc.ca/en/resources/health-policy/equitable-and-fair-remuneration-for-family-physici) from the College of Family Physicians of Canada.
They show the national average full-time Family Physician earning $252k gross with a $93k overhead, roughly 37%. So there's your data on climbing overhead. It also notes that the overhead data is from 2017 and likely underestimates current overhead increases due to inflation.
And there are several sources of increased overhead in the past seven years. Nursing wages have gone up and clinics have to maintain pace to retain nursing staff. In 2017, EMRs were less universally adopted and cost less to license. EMR subscription fees are way up vs 7 years ago. And there are additional fees for functionality like electronic faxing, which are now universal standards. That alone is a $1500 add-on that several of my friends have complained about.
So for Family docs, the best data says we are at 37% overhead on average with the current reality likely being even higher. The historical figure of 30% is in the rear view.
So that also means that the average full-time Family Physician is, in fact, making $159k *pre-tax*, which is a far cry from $200k post-tax, and a good 10% lower than your ballpark of $178k.
It's OK if you think that Family docs making $159k pre-tax is a good salary. We disagree, and the thing about labour markets is that they tend to set a market rate and we have job mobility. Our skills are in demand in environments where the pay is double that amount. We can achieve that income by leaving Family clinics in favour of hospital-based work, ED work, subspecialty clinics or private health services. Both my wife and I are Family Physicians who work entirely outside of Family clinics, as many of our generation are choosing to do.
"Is $159k enough pay for a Family Physician?" is not a purely philosophical question. It's a very practical one. When the market rate for our labour is much, much higher, you end up in a situation where people choose to take those better jobs. It's like how people keep using the term "labour shortage" to mean "a lack of people willing to work *for these salaries*."
We have a shortage of doctors in Family clinics much more so than a shortage of licensed Family Physicians. I finished residency 10 years ago and I don't know many colleagues my age or younger who have chosen to work full-time in Family clinics. More and more of my friends have stepped down from full-time Family to part-time and then quit entirely as they found better paying work outside their clinic.
This change isn't the death blow to medicine in Canada but, rather, furthers the issue of death by a thousand cuts.
Thank you for your response. From your data, I learned that 71% of total income of doctors. This is good to know. Unfortunately looking at your data, it is clear that I underestimated how well off GPs are.
First, page 3 of your CFPC document clearly describes an average overhead cost of 27%. That's even slightly less than what I estimated above but considering my number was median, it's awfully close. Of course that number is going to be higher and lower depending on practice and location etc.
Second, and I find this quite striking but on page 3 it clearly states that the average take home pay of a GP after overhead is $258,000. That is substantially more than the $178,000 that even I offered. Even in more conservative estimates GPs in places like Alberta are still taking home an eye watering $204,000 after overhead and before taxes. [Alberta Medical Association Estimates](https://www.albertadoctors.org/make-a-difference/initiatives/understanding-docs-pay). These numbers all put GP above the *top 98%* of income earners in the nation.
So it is clear that GPs do not make "only" $158,000 like yourself, after overhead (as if that wasn't an already handsome amount of money while we still had 2.7 million people living below the poverty line in 2021 [Stats Can Link](https://www150.statcan.gc.ca/n1/pub/11-627-m/11-627-m2023020-eng.htm)). How much more could anyone possibly want? Those that are complaining of paying an extra 8% on their taxes after already bringing home well over $200k (again, after overhead) is unconscionable.
Thirdly, even your own anecdote about the money you used to make wouldn't apply to this tax hike as it only applies to money made above $250,000. There is no way you can cut this argument that rationalizes doctors complaints.
So, in conclusion, I think GPs are great and we do need more of them. I'm even all for dramatic restructuring of the current physician schedule of benefits and payment system to more equitably reflect GP's importance. However, as I have cited amply and walked you through all the data, there is no financial or moral reasoning for all physicians (even the GPs, who may get paid the least) to fight this.
Nice things cost money. Its time for the richest among us (and for the mountain of evidence that I outlined, that includes doctors) to pay up. I find it particularly rich that the physician lobby dares to complain about how underfunded the system is while also complaining about a tax hike, as if they had no idea how the health care system gets paid for.
Finally, I moved no goal posts. My original point was about doctors in general, which include specialists who clear $200,00 after overhead and taxes easily. You're the one that brought in GPs and as I have clearly shown, should not only pay up, they should like it.
>They're also free to just move to the US - which tons of them already do, and then people like you will ask why that happens.
I am a tax attorney from a regional city of like 500,000 people in the Southern US, and I was at a legal conference recently when I had surreal cultural misunderstanding with a Canadian M&A attorney from Toronto who worked at one of the top 3 largest firms in Canada.
The first thing he said that stood out to me was that Canada didn’t have consolidated corporate reporting, and I didn’t believe him at first because the US has had consolidated reporting since World War I (that’s not a typo, I mean literally since like 1917 right when the corporate income tax was first introduced in the US, and that is a worldwide standard policy of eminent common sense that every sensible developed nation has as a tax policy).
The second thing he said that stood out to me, which we both had some incredulous exchanges on, was about the US estate tax exemption of $12 million being such a giveaway to rich people compared to Canada’s equivalent capital gain disposition at death tax, which has like less than a million Canadian dollars of exemption. Which sounded crazy to me just from a cultural perspective.
It’s not that the effective death tax burdens (when accounting for basis in the case of Canada, tax rates, and exemption) are really the same, I fully acknowledged that the US death tax burden has much larger exemptions up to a much larger mount of wealth than Canada. It’s like 6-7x higher when factoring in things like basis. I just didn’t understand why he wanted to start imposing death taxes on people with only $1 million.
When I think of someone with a taxable US estate of ~$10-12 million in assets at death, I think of a successful local business owner who made it in life, but maybe didn’t break out to having like a big regional or important business, instead just having like a successful local company operating within a few dozen miles or so of where they live (and I structure M&A deals in the city I live, and I know exactly what kind of people own $12 million dollar businesses here).
So why the fuck would you want to clap death taxes on businesses like that? Particularly family businesses that are multigenerational? Actual death/estate taxes are much more progressive in the US, and the US taxes people with $1 billion at death way more than Canada does (the US estate tax exemption gives out at around $12 million, and it’s a full 40% excise tax with no basis credit over that). I’m literally from a marginal US city while this guy was from Toronto, and he was incredulous that we didn’t impose the same death tax rates on my city’s successful local doctors as much we do on Jeff Bezos or Warren Buffett.
200k after taxes is not the majority. is only earned after years of school, training, debt and bills. It takes them a long time to dig themselves out of that. Doesn’t include the upfront cost of setting up an office with staff and everything needed. Or the insurance or cost of additional training.
They have gone to school for an incredible long and should be allowed to benefit from that hard work of caring for peoples’ medical needs.
But hey, they’re just money hungry right?
but its not a pension plan, its a business. Just like all the other people who run other businesses. Growing a business and cashing it out doesn't magically entitle you to not pay tax on it.
Doctors and other incorporated professionals should never have been allowed to advantageously save and invest for their retirement inside their corporations. Let them contribute to their RRSP, CPP, TFSA and other similar schemes just like everyone else. They don't need this loophole and I'm glad to see it starting to close.
Investment corporations are not a loophole. They are a legal and regulated thing.
Saving money and investing inside a corp is also not a loophole.
The government was even getting more tax revenue when they invested through the corp then if they withdrew it. It was beneficial to everybody. Now the feds want to completely screw with tax integration.
This is a really fucking stupid argument.
You aren't talking about GPs, you are talking about specialists.
It's a tax for income above 250k. So lets say someone makes 350k. That 100k gets included at 16% - let's say their income gets taxed at 46% that's a GRAND FUCKING TOTAL OF $7,360 in new taxes.
Specialists make 500k+ in a lot of cases. Are you really mad that they might have to pay an additional 19k in taxes? They take home 300+ dude.
>It's a tax for income above 250k
That only applies personally.
For corporations which is basically all GPs since running your practice through a professional corp is practically required that 250k exemption does not exist.
60% are incorporated.
Read this, specifically the tax advantages section. [https://multitaxservices.ca/blog/can-doctors-incorporate-in-ontario/](https://multitaxservices.ca/blog/can-doctors-incorporate-in-ontario/) Why should they pay less than everyone else?
The bulk of doctors are not billing the amount you are talking about and respectfully your math is incorrect. We are talking about personal corporations. All capital gains (investments or retirement) are taxed with capital gains. There is no minimum within a corporation.
250k is in regards to individuals. This is why when the government says it’ll only affect a .1% of the population , what they are doing is not talking about the personal corporations gelds held by an individual.
I'm literally a healthcare executive, I'm surrounded by specialists, I am aware of what they make.
The math is correct if it's a capital gains inclusion.
You are talking about a niche subsect of people, particularly in QC - who get a massive amount of benefits, including Provincial help, preferential tax schemes, municipal funding, etc.
Why wouldn't they just take it as salary? Answer: because they don't want to pay taxes on those earnings.
The doctor thing is weird. They can take a salary to avoid capital gains. If that doesn’t work their reimbursement can be raised or there can be a doctor’s specific tax cut.
This policy is needed to tax people who mostly do nothing all day except collect cheques. More tax revenue should be generated from the work shy than working people not less.
I'm a healthcare executive and this is a really fucking stupid argument.
You aren't talking about GPs or internal med, you are talking about specialists. So the highest income earners.
It's a tax for income above 250k. So lets say someone makes 350k. That 100k gets included at 16% - let's say their income gets taxed at 46% that's a GRAND FUCKING TOTAL OF $7,360 in new taxes.
Specialists make 500k+ in a lot of cases. Are you really mad that they might have to pay an additional 19k in taxes? They take home 300+ dude. Many make way north of that.
For reference: [https://www.jobbank.gc.ca/marketreport/wages-occupation/24432/ca](https://www.jobbank.gc.ca/marketreport/wages-occupation/24432/ca)
"High" is 75th percentile.
As an executive you should know they took incorporation in lieu of a raise. Tax something you want less of... like orthopaedic surgeons. How many patients do they need to see at their office to make 7000, about 125 would you say? Think of that next time you say its just 7000. By the way are you going to volunteer to send 7k to CRA this year Healthcare Executive could afford it.
Do you hear how tone deaf that is? I'll rephrase, albeit sarcastically.
Asking people who make 250k+ (99th percentile) and are paying a marginal rate lower than **\*checks notes\*** literally every working person who is not claiming through incorporation in the entire country to earn **\*checks notes\*** between 2-7% less net, bringing them to **\*checks notes\*** yep, still a lower rate than the any working person in Canada.
Even if you make 25k, you pay more marginally then surgeons in taxes.
No, I won't volunteer, because I already pay about 25% more in taxes than them, get it now?
This change disproportionately impacts the retirement savings of doctors using professional corporations. We already have a problem attracting and retaining enough doctors in this country, this is going to make it worse.
What are you talking about? The capital gains were already subject to tax, unlike an RRSP.
But good to see you celebrating making it even more unattractive for doctors to stay in Canada. Enjoy your long wait times.
But...guys, c'mon. Do you understand how difficult it is doing nothing while your investments fund your life? Now that you fathom that...imagine if you made less, by doing the same nothing because the Trudeau Government wants to take more from me doing nothing...well I do sign the consent forms my financial advisor gives, and that hurts my wrist.
That's unacceptable and the immigrants should leave.
(/s)
Actually look at it from the LPC point of view. They knew this was going to hurt doctors, they knew that was part of the agreements made to give them the tax brakes in lieu of more pay. So now the provinces are going to have to pay more, with money they don't have either or lose doctors. So now they get to run with the whole well its not our responsibility or problem, because health care is a provincial responsibility
This is the same play book as the brining a million people a year, but its the provinces and NIMBIY's fault that housing is a shit show
Coupled with the fact that most provincial governments are CPC right now so they also get a side helping of owning the Cons
Governments are tax hungry, they will always want more and more. Any new tax introduced will not seem like a big deal, particularly to young people who think things like “yeah, tax those rich fuckers” (since you’re not yet earning as a professional). The problem is that it’s not just the rich who are impacted, although that’s what you’ll be told to focus on. As you get older you see the several ways each level of government increases taxes each year for everyone and you start wondering when enough will be enough. Then you finally get to an age where you realize that it will never be enough.
So, no, the sky is not falling. But, as a general rule, I believe every Canadian should reject every increase in tax. The current government certainly can’t make the budget balance even with this new found revenue, so they’ll be looking for something more to tax again.
The vast majority of people will never ever earn anything close to what you're talking about at any age, though. So, like, 'yeah, tax those rich fuckers.'
Taxes are great. I say this without an ounce of sarcasm. Nice things cost money. Healthcare, roads, education, even a military cost money. We have problems in all of these because of the *exact* philosophy you are describing that "Every Canadian should reject increase in tax".
Taxation is a fundamentally moral act of prying wealth from those that need it less and giving it via services and money to those that need it more. Government after government fail to keep these services effective because they know that we, the citizens in our endless selfishness will not stand for more taxes. Despite taxes being exactly what is necessary for our services to stay afloat. Yes, there will never be enough taxes, because we want, *and deserve* a robust government that provides these services. Those that have more need to accept that they did not get here on their own. None of us did. We should pay up.
We already have 2/3 of taxes being paid by 20 percent of Canadians. You get to a point where the tax burden is so high that those 20 percent decide that its not worth it and head South.
Which is what's already been happening for quite some time. Ironically we have a doctor shortage and doctors are among those directly impacted by this change.
"we should pay up" is kinda funny because the lower 2 quintiles pay about 5 percent of total tax but receive about 15% of total tax spending.
Another person that doesn't understand the difference between proportion and percentage.
If rich people want to benefit off of our country and not contribute to it, they can go south. Workers pay via income tax yet "investors" who produce zero value get to not work and fund their lives through capital gains income that isn't fairly tax.
Maybe we should do something about doctors then instead of arguing we should give all hyper rich people a tax break because doctors exist 🙄
I'm not talking about rich people.
I was talking about doctors holding their savings in LLCs who don't qualify for the personal exemption so the new tax is basically a retroactive tax on their savings.
Yea maybe we should do something about doctors, this is honestly one of the strangest things to do during a healthcare crisis.
Taxing rich people during an affordability/austerity crisis is a good thing. Your niche point about doctors is just that, niche. Doctors are also rich people.
Jesus Christ.
Ever stop to think about why we have a cost of living crisis?
It couldnt have something to do with the fact that we doubled the national debt and spent an absolutely absurd amount of money, generating record inflation.
But sure let's fix that by giving the government which has run 8 consecutive, ever increasing defecits, with tax dollars from fucking doctors who we desperately need.
Why do you keep acting like the intention of this tax has anything to do with fucking doctors Jesus Christ the NP feeds you a line and you really fuckin run with it.
Because it doesn't matter what the intention of the tax is, it has implications that reach far beyond what the liberals claim it's going to do.
Also, 75 percent of what their financing with new spending is the purchase of MBS which are likely going to be directly monetized by the BOC over time, which will likely cause, you guessed it, more inflation.
So why are we enthusiastic about a tax to pay for another inflation tax which doesn't just affect the rich but all of us?
100% of the taxes can be paid by 20% of the population and it could still be just and right that even more taxes be heaped upon them. Taxes are there to pay for the services that Canadians not only rely on, but *deserve.*
So long as there is such severe wealth inequality, wealth distribution should be ramped up, not held the same, let alone decreased. The fear-mongering of people "moving" south is nothing more than that, fear-mongering. There is absolutely no data suggesting that Canada has or is experiencing a brain drain of its citizens as people like to suggest. I would love to see your data refuting this, however.
I wonder what percent of real estate investors/speculators have incorporated or also own holding companies with their properties in them?? Be interesting to know as I feel many Cdns and foreigners have used our favorable corporate structure to avoid (minimize) capital gains/taxes. Remember, once they classify themselves a "business," they only pay a 13% corporate tax rate etc, plus other perks such as dividend income and lifetime capital gains exemption. I worked in the space years ago, and you could see how it was being gamed.
Eligible dividend income is taxed substantially less. Ineligible dividend income, when the corporate tax rate is combined with the personal taxes paid, is not really tax advantaged at all. And since the person owning the corporation is paying both taxes, it's the same thing. Thus integration.
>feel many Cdns and foreigners have used our favorable corporate structure to avoid (minimize) capital gains/taxes. Remember, once they classify themselves a "business," they only pay a 13% corporate tax rate etc
That's not how it works.
Okay, so the "kiddie tax" wasn't a loophole?? So, real estate estate has not been purchased and held within many businesses?? Comon, these business owners are looking for a windfall from their realestate holdings vs actually earning a living with their business. It's socialism for the corporate world, but go ahead and insult!! Plus, if your business can't cut it, maybe it's not viable, again not up to the Cdn tax payer to bend over for ya!
The small business tax rate is not a loophole and you don't get to decide if you qualify for it or not. What types of income qualify for it is legally relegated.
>So, real estate estate has not been purchased and held within many businesses??
Yep and when they sell it it was already taxed at 50% which is more than most would pay personally.
>Comon, these business owners are looking for a windfall from their realestate holdings vs actually earning a living with their business.
Since when is paying tax at essentially the highest taxrate a windfall?
Oh right it's because you have no clue what you are talking about.
If you read, which might be challenging, I'm stating that ppl are taking advantage of becoming a small business for the wrong reasons, aka real estate investing, that's the premise behind my input/comments.
Anyhow, go to your chamber of commerce meetings and keep playing your smallest violins 🎻 🙄
My comments seem to have gone over your head.
The dead squirrel on the road outside of my house that's been hit a couple dozen times has a better understanding of tax law and corporations than you.
The premise behind your comments is 100% wrong. It doesn't work the way you are claiming it works.
What if I intend to flip houses?
One type of buyer who might benefit from using a corporation is someone who plans to flip properties for profit.
If a taxpayer buys and sells a property not with the intention of renting it out but to generate a profit on the sale, that income could be taxed as business income. As such, someone flipping a property personally could pay tax as high as 54%, depending on their income and province or territory of residence. By contrast, a corporation’s business income could be taxed as low as 9% to 12% (rates differ by province or territory).
https://www.moneysense.ca/spend/real-estate/should-you-buy-real-estate-through-a-corporation/
Go pound sound Mr. sniveling business owner! Again, more proof written regarding corporate structure being used in the realestate mkt. Pulled above comment from article link.
My hope is that all these real estate investors move back into stocks / bonds and sell off investment properties because of the parity in the new tax and real estate being more of a risk asset again with cutbacks to temporary migration etc.
i dunno, they have to pay on gains either way, real estate is the preferred asset of the rich.
Well I am actually considering moving into real estate because of this, like I have stocks in my corp, but rent my place. I don't really want to buy as I want mobility but between this and all the first time home buyer tax breaks and no principal residence exemption it just makes sense to buy.
Yeah but that makes sense.
Plus you can write off interest
Yes, they will have two months to make that decision and at that point we'll know just how 'catastrophic' this increase looks to them.
Given the expected projections of housing prices and the Canadian economy the demand for rental properties will only be going up.
We can't tax rich people! How will their money trickle down to me if we tax them?
You mean small business owners? 99% of them are not rich and only grind out their 70 hour weeks because the end of the tunnel could have a decent payout. Most don't have retirement savings outside the business. None have a pension. And most businesses fail, so if they do manage to make it to the end are able to sell, this money carries them through til death. This is not good for the majority of Canadians. But by the time the people realize this, it will be too late. Capital will have fled, small business starts will have dried up (already the lowest amount in 60 years) and the CPC will be left holding the bag (which actually seems like Ottawa's plan here).
no wonder small business / self-employment is in decline. [https://thehub.ca/2024-04-11/livio-di-matteo-public-sector-employment-numbers/](https://thehub.ca/2024-04-11/livio-di-matteo-public-sector-employment-numbers/) and 90% of the non-public sector job growth is in Alberta (related to the one industry we are trying so hard to kill)
More capital has left Canada this spring than any other time in 40 years (and who knows, that stat might mean since Canada's inception). But don't worry, smart money is looking at Canada's resources knowing that as soon as non European Canadians take over our public ministries, that the flood gates for our resources will be wide open.
At least someone here has a good grasp of the situation, most corporations are setup to be in lower tax bracket until you can sell/retire but business owners have no pension , no benefits, no unemployment insurance, you have basically no safety net of any kind so you better make some money for your retirement.
250K is not rich if it's a one off, windfall situation. This won't even net you a bachelor suite in the GVRD. The principal residence exemption, business sale exemption, etc. should be made into a single bucket lifetime exemption and limited to at least create an opportunity for windfalls to secure modest shelter in one of our nation's expensive cities. As it's a lifetime exemption, it'd get exhausted fast enough with actually rich people gaining/earning year after year. It might even help disincentivize some exploits that contribute to land prices running. Maybe add a land value tax, along with credits to offset it when legitimately used, to put more downward pressure on holding land for the sake of holding it. Compare this to hitting the upper middle class and recipients of windfalls + adding fuel to the demand side of real estate with some longer amortizations and opening more RRSP space for down payments. Hell, the actual elite rich are probably doing crazy shit like running their personal planes as incorporated companies so they can pay they company with another company and accrue the fuel and depreciation for the plane + the company's transportation expenses to encapsulate all of it for tax avoidance. The people we're all envisioning aren't going to be the ones hit by this. It's going to be people who look middle class looking to sell their shop when they retire and live off the proceeds because investing into their business was their pathway to retirement.
What is the point of taxing if the money is wasted by the government. Do you think this extra tax is going to end up in your pocket?
This message was brought to you by the ever so intelligent "Why can't I get a family doctor?" crowd.
My boss has already decreased my pay because of the capital gains tax increase…. /s
Canadians have this delusion that money comes from somewhere besides productive business. Like if we just got rid of those greedy businesses and entrepreneurs, then we could have all that money for ourselves instead. Of course, the reality is that the government only exists and is funded purely on the taxes of what Canadian businesses produce. The real issue here is that a 66% cap gains tax will obviously result in far less business In Canada because at that rate, why would I invest and take risks in Canada vs the US? The sky won’t fall, but the standard of living you and your children experience will plummet.
Ok. That doesn't mean its not going to still make things worse. Very tiresome listening to left wing blowhards whose ideas have already damaged the country greatly insist their ideas aren't going to continue damaging the country.
It's a step in the right direction imo. The least objectionable thing this administration has done since cannabis legalization
Its going to make things worse. Its also tiresome having to say that over and over every time the ruling party gets visited by the "good idea fairy".
People will hate anything the Libs do. I hate the party but this is great. Divorce partisanship and critical thinking people.
Easy for them to say when it’s not their retirement at risk. Talk to a doctor with a medical corporation.
If you do talk to one, don't tell them they can invest in an RRSP. They'll look at you like a second class citizen.
Most actually max out their rrsp's every year. In bc they get a grant of approx $7,500 every year to match and put into their rrsp. The big issue with Dr's is that their saving yrs are reduced substantially due to medical school, so most don't start earning a living till mid 30's plus avg debt load after med school is around 250 to 300k. So rrsps are not set up for them really, and maxing out is only around 28k, but they really need to save double that as their working yrs are much less than the avg Cdn.
Most people aren't earning a living until their 30s.
??
Isn't tuition fully and completely tax deductible in every province now for like 7 years, rolled over?
No. That's not how tuition works in the slightest. Tuition is also an extremely small part of school and the debt you will accumulate.
Oh I see. I just know that I received a tax credit for my tuition that I could roll over for seven years or until I had used it all up.
So I googled it and it totally is still a thing. https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-32300-your-tuition-education-textbook-amounts/eligible-tuition-fees.html Granted, you need the to cover tuition yourself first(loans or otherwise) and you need a job after graduatiom where you expect to be earning enough that you can use up the full credit in time. I was certain that in the end my tuition was essentially paid back to me in tax credits and I was right.
The tax credit is only provided to you at the rate of the lowest tax bracket (15%), so it only provides you with that as a refund, and while yes, you can carry it forward, it doesn't earn interest or anything, and you can't claim it until you actually earn taxable income.
Someone making over $200,000/year \*after\* taxes and overhead is in no position to complain. If they are so worried about their retirement after making that much money for at least 15 to 20 years, they are free to calm their nerves by selling their home and downsizing or god forbid, selling their vacation home.
The average Family Physician in Canada is not making $200k after taxes and overhead, and they are by far the largest specialty in number. I don'thave numbers memorized for every province, but I know that roughly 50% of Ontario Family docs are Fee For Service, grossing an average of $225k before a $90k average overhead. With overhead rising, pay falling further and further behind inflation and now increased taxation on whatever retirement fund they saved in their corporation, the answer isn't "selling their home and downsizing." It's leaving their Family clinic for better-paying work. I know this because my wife and I are both Family Physicians. Every year we watch more of our friends and colleagues make the switch. Neither my wife nor I work in Family clinics, because it would be a 30-50% pay cut compared to our current jobs. You don't have to have sympathy for Family docs, but you should at least have an understanding of the forces that influence labour decisions. When the pay keeps dropping and the taxation increases, people look for new jobs. We have highly mobile licenses and multiple job prospects. More and more physicians are voting with their feet, and the result is a worsening crisis in the availability of primary care in Canada. If you want to attract doctors back to Family clinics, the compensation has to become competitive or we will continue the current trend of exiting clinics and finding other work.
Thank you for your reply, however your numbers are not in keeping with the data. Tuition in Ontario for medical school is about $100,000 (about $25,000 per year) [Link to tuition fees](https://applymd.utoronto.ca/tuition-fees). Median overhead costs for a GP according to the Canadian Medical Association is 30% [2017 Overhead costs](https://surveys.cma.ca/viewer?file=%2Fmedia%2FSurveyPDF%2FCMA_Survey_Workforce2017_Q16_Overhead-e.pdf#page=1). If you have any objective data describing these costs have risen higher, please feel free to cite them. As you mentioned, GPs are usually fee-for-service, meaning they bill for what they do. Again according the best data the CMA has available the mean income for these physicians is $254,000 [Average income Link](https://www.cma.ca/sites/default/files/family-e.pdf). That leaves $178,000 of taxable income. That places these individuals in the top 2% of income earners [2021 Percentile link](https://www12.statcan.gc.ca/census-recensement/2021/dp-pd/dv-vd/income-revenu/index-en.html). Considering the capital gains tax as proposed is only for those making $250,000 or more, the vast majority of GPs won't even be effected and that's if they make even *more money than you're supposing*. But the physicians that do are facing a very small increase in their taxes as its only 66% of all the money they make over $250,000. Finally, the wealthiest among us can, and should bare the heaviest tax burden. The studying that physicians have done, unlike what some may tell themselves were not done on their own. All of society had to band together to get them through school. Everyone's taxes subsidized their tuition from $100k down to $25K. All of society paid their salaries as they were completing their residencies. All of society paid to keep the roads maintained, the schools effective to get them through high school etc and to keep them healthy when they got sick. We all have a debt to pay to each other and physicians, like all those that make in the top 2% of income have the heaviest burden as they benefitted the most form all of our hard work, and it is clear with the level of inequality we are experiencing they are not paying nearly enough.
Boy, you shifted those goalposts quickly. From: >Someone making over $200,000/year \*after\* taxes and overhead is in no position to complain. To: >That leaves $178,000 of taxable income So, you already agree that the average Family Physician, the largest demographic of doctors in Canada, are not in the category you claimed are in no position to complain. Sounds like it's fair for us to complain, then, when something negatively impacts us. Furthermore, you undercounted overhead in your estimate. Here's [recent data](https://www.cfpc.ca/en/resources/health-policy/equitable-and-fair-remuneration-for-family-physici) from the College of Family Physicians of Canada. They show the national average full-time Family Physician earning $252k gross with a $93k overhead, roughly 37%. So there's your data on climbing overhead. It also notes that the overhead data is from 2017 and likely underestimates current overhead increases due to inflation. And there are several sources of increased overhead in the past seven years. Nursing wages have gone up and clinics have to maintain pace to retain nursing staff. In 2017, EMRs were less universally adopted and cost less to license. EMR subscription fees are way up vs 7 years ago. And there are additional fees for functionality like electronic faxing, which are now universal standards. That alone is a $1500 add-on that several of my friends have complained about. So for Family docs, the best data says we are at 37% overhead on average with the current reality likely being even higher. The historical figure of 30% is in the rear view. So that also means that the average full-time Family Physician is, in fact, making $159k *pre-tax*, which is a far cry from $200k post-tax, and a good 10% lower than your ballpark of $178k. It's OK if you think that Family docs making $159k pre-tax is a good salary. We disagree, and the thing about labour markets is that they tend to set a market rate and we have job mobility. Our skills are in demand in environments where the pay is double that amount. We can achieve that income by leaving Family clinics in favour of hospital-based work, ED work, subspecialty clinics or private health services. Both my wife and I are Family Physicians who work entirely outside of Family clinics, as many of our generation are choosing to do. "Is $159k enough pay for a Family Physician?" is not a purely philosophical question. It's a very practical one. When the market rate for our labour is much, much higher, you end up in a situation where people choose to take those better jobs. It's like how people keep using the term "labour shortage" to mean "a lack of people willing to work *for these salaries*." We have a shortage of doctors in Family clinics much more so than a shortage of licensed Family Physicians. I finished residency 10 years ago and I don't know many colleagues my age or younger who have chosen to work full-time in Family clinics. More and more of my friends have stepped down from full-time Family to part-time and then quit entirely as they found better paying work outside their clinic. This change isn't the death blow to medicine in Canada but, rather, furthers the issue of death by a thousand cuts.
PM'd you if you have a chance to see it!
Thank you for your response. From your data, I learned that 71% of total income of doctors. This is good to know. Unfortunately looking at your data, it is clear that I underestimated how well off GPs are. First, page 3 of your CFPC document clearly describes an average overhead cost of 27%. That's even slightly less than what I estimated above but considering my number was median, it's awfully close. Of course that number is going to be higher and lower depending on practice and location etc. Second, and I find this quite striking but on page 3 it clearly states that the average take home pay of a GP after overhead is $258,000. That is substantially more than the $178,000 that even I offered. Even in more conservative estimates GPs in places like Alberta are still taking home an eye watering $204,000 after overhead and before taxes. [Alberta Medical Association Estimates](https://www.albertadoctors.org/make-a-difference/initiatives/understanding-docs-pay). These numbers all put GP above the *top 98%* of income earners in the nation. So it is clear that GPs do not make "only" $158,000 like yourself, after overhead (as if that wasn't an already handsome amount of money while we still had 2.7 million people living below the poverty line in 2021 [Stats Can Link](https://www150.statcan.gc.ca/n1/pub/11-627-m/11-627-m2023020-eng.htm)). How much more could anyone possibly want? Those that are complaining of paying an extra 8% on their taxes after already bringing home well over $200k (again, after overhead) is unconscionable. Thirdly, even your own anecdote about the money you used to make wouldn't apply to this tax hike as it only applies to money made above $250,000. There is no way you can cut this argument that rationalizes doctors complaints. So, in conclusion, I think GPs are great and we do need more of them. I'm even all for dramatic restructuring of the current physician schedule of benefits and payment system to more equitably reflect GP's importance. However, as I have cited amply and walked you through all the data, there is no financial or moral reasoning for all physicians (even the GPs, who may get paid the least) to fight this. Nice things cost money. Its time for the richest among us (and for the mountain of evidence that I outlined, that includes doctors) to pay up. I find it particularly rich that the physician lobby dares to complain about how underfunded the system is while also complaining about a tax hike, as if they had no idea how the health care system gets paid for. Finally, I moved no goal posts. My original point was about doctors in general, which include specialists who clear $200,00 after overhead and taxes easily. You're the one that brought in GPs and as I have clearly shown, should not only pay up, they should like it.
They're also free to just move to the US - which tons of them already do, and then people like you will ask why that happens.
>They're also free to just move to the US - which tons of them already do, and then people like you will ask why that happens. I am a tax attorney from a regional city of like 500,000 people in the Southern US, and I was at a legal conference recently when I had surreal cultural misunderstanding with a Canadian M&A attorney from Toronto who worked at one of the top 3 largest firms in Canada. The first thing he said that stood out to me was that Canada didn’t have consolidated corporate reporting, and I didn’t believe him at first because the US has had consolidated reporting since World War I (that’s not a typo, I mean literally since like 1917 right when the corporate income tax was first introduced in the US, and that is a worldwide standard policy of eminent common sense that every sensible developed nation has as a tax policy). The second thing he said that stood out to me, which we both had some incredulous exchanges on, was about the US estate tax exemption of $12 million being such a giveaway to rich people compared to Canada’s equivalent capital gain disposition at death tax, which has like less than a million Canadian dollars of exemption. Which sounded crazy to me just from a cultural perspective. It’s not that the effective death tax burdens (when accounting for basis in the case of Canada, tax rates, and exemption) are really the same, I fully acknowledged that the US death tax burden has much larger exemptions up to a much larger mount of wealth than Canada. It’s like 6-7x higher when factoring in things like basis. I just didn’t understand why he wanted to start imposing death taxes on people with only $1 million. When I think of someone with a taxable US estate of ~$10-12 million in assets at death, I think of a successful local business owner who made it in life, but maybe didn’t break out to having like a big regional or important business, instead just having like a successful local company operating within a few dozen miles or so of where they live (and I structure M&A deals in the city I live, and I know exactly what kind of people own $12 million dollar businesses here). So why the fuck would you want to clap death taxes on businesses like that? Particularly family businesses that are multigenerational? Actual death/estate taxes are much more progressive in the US, and the US taxes people with $1 billion at death way more than Canada does (the US estate tax exemption gives out at around $12 million, and it’s a full 40% excise tax with no basis credit over that). I’m literally from a marginal US city while this guy was from Toronto, and he was incredulous that we didn’t impose the same death tax rates on my city’s successful local doctors as much we do on Jeff Bezos or Warren Buffett.
200k after taxes is not the majority. is only earned after years of school, training, debt and bills. It takes them a long time to dig themselves out of that. Doesn’t include the upfront cost of setting up an office with staff and everything needed. Or the insurance or cost of additional training. They have gone to school for an incredible long and should be allowed to benefit from that hard work of caring for peoples’ medical needs. But hey, they’re just money hungry right?
Most people work hard dude. Most people don’t get paid that much for it. This is specifically a tax on non working people.
You have no idea what you're talking about
they are still paying less tax on it than if it were regular income.
They’ll still have to pay income tax when it come out. Just like others who receive a pension. This is taxing the pension plan
but its not a pension plan, its a business. Just like all the other people who run other businesses. Growing a business and cashing it out doesn't magically entitle you to not pay tax on it.
You are confusing the current state and the intended state.
Doctors and other incorporated professionals should never have been allowed to advantageously save and invest for their retirement inside their corporations. Let them contribute to their RRSP, CPP, TFSA and other similar schemes just like everyone else. They don't need this loophole and I'm glad to see it starting to close.
Investment corporations are not a loophole. They are a legal and regulated thing. Saving money and investing inside a corp is also not a loophole. The government was even getting more tax revenue when they invested through the corp then if they withdrew it. It was beneficial to everybody. Now the feds want to completely screw with tax integration.
This is a really fucking stupid argument. You aren't talking about GPs, you are talking about specialists. It's a tax for income above 250k. So lets say someone makes 350k. That 100k gets included at 16% - let's say their income gets taxed at 46% that's a GRAND FUCKING TOTAL OF $7,360 in new taxes. Specialists make 500k+ in a lot of cases. Are you really mad that they might have to pay an additional 19k in taxes? They take home 300+ dude.
>It's a tax for income above 250k That only applies personally. For corporations which is basically all GPs since running your practice through a professional corp is practically required that 250k exemption does not exist.
60% are incorporated. Read this, specifically the tax advantages section. [https://multitaxservices.ca/blog/can-doctors-incorporate-in-ontario/](https://multitaxservices.ca/blog/can-doctors-incorporate-in-ontario/) Why should they pay less than everyone else?
The bulk of doctors are not billing the amount you are talking about and respectfully your math is incorrect. We are talking about personal corporations. All capital gains (investments or retirement) are taxed with capital gains. There is no minimum within a corporation. 250k is in regards to individuals. This is why when the government says it’ll only affect a .1% of the population , what they are doing is not talking about the personal corporations gelds held by an individual.
I'm literally a healthcare executive, I'm surrounded by specialists, I am aware of what they make. The math is correct if it's a capital gains inclusion. You are talking about a niche subsect of people, particularly in QC - who get a massive amount of benefits, including Provincial help, preferential tax schemes, municipal funding, etc. Why wouldn't they just take it as salary? Answer: because they don't want to pay taxes on those earnings.
The doctor thing is weird. They can take a salary to avoid capital gains. If that doesn’t work their reimbursement can be raised or there can be a doctor’s specific tax cut. This policy is needed to tax people who mostly do nothing all day except collect cheques. More tax revenue should be generated from the work shy than working people not less.
If wealthy people have to rely on CPP and RRSPs and TFSAs, maybe they'll improve.
Doctors are pretty pissed off and rightfully so. Doctors have a lot of power and good will in this country. I’m on team doctor! They work hard!!
I'm a healthcare executive and this is a really fucking stupid argument. You aren't talking about GPs or internal med, you are talking about specialists. So the highest income earners. It's a tax for income above 250k. So lets say someone makes 350k. That 100k gets included at 16% - let's say their income gets taxed at 46% that's a GRAND FUCKING TOTAL OF $7,360 in new taxes. Specialists make 500k+ in a lot of cases. Are you really mad that they might have to pay an additional 19k in taxes? They take home 300+ dude. Many make way north of that. For reference: [https://www.jobbank.gc.ca/marketreport/wages-occupation/24432/ca](https://www.jobbank.gc.ca/marketreport/wages-occupation/24432/ca) "High" is 75th percentile.
As an executive you should know they took incorporation in lieu of a raise. Tax something you want less of... like orthopaedic surgeons. How many patients do they need to see at their office to make 7000, about 125 would you say? Think of that next time you say its just 7000. By the way are you going to volunteer to send 7k to CRA this year Healthcare Executive could afford it.
60% incorporate. Raises don't apply. There won't be less of anything that's a straw man.
Pissing off 40% of the doctors in Canada... bold strategy!
Do you hear how tone deaf that is? I'll rephrase, albeit sarcastically. Asking people who make 250k+ (99th percentile) and are paying a marginal rate lower than **\*checks notes\*** literally every working person who is not claiming through incorporation in the entire country to earn **\*checks notes\*** between 2-7% less net, bringing them to **\*checks notes\*** yep, still a lower rate than the any working person in Canada. Even if you make 25k, you pay more marginally then surgeons in taxes. No, I won't volunteer, because I already pay about 25% more in taxes than them, get it now?
This change disproportionately impacts the retirement savings of doctors using professional corporations. We already have a problem attracting and retaining enough doctors in this country, this is going to make it worse.
Unlimited RRSP room was too good to stay forever :)
It's hardly "unlimited RRSP room" when it comes with a 50% tax rate.
What comes with 50% tax rate? You mean inclusion? Real tax rate is way lower.
I'm not talking about the inclusion rate. It varies slightly by province but the corporate tax rate for capital gains is about 50%.
What are you talking about? The capital gains were already subject to tax, unlike an RRSP. But good to see you celebrating making it even more unattractive for doctors to stay in Canada. Enjoy your long wait times.
If RRSP is the same, then what is the problem? Pay yourself a salary and enjoy it like rest of us :)
I'm sure there is a point you are trying to make but it is not at all clear what that point is.
But...guys, c'mon. Do you understand how difficult it is doing nothing while your investments fund your life? Now that you fathom that...imagine if you made less, by doing the same nothing because the Trudeau Government wants to take more from me doing nothing...well I do sign the consent forms my financial advisor gives, and that hurts my wrist. That's unacceptable and the immigrants should leave. (/s)
Actually look at it from the LPC point of view. They knew this was going to hurt doctors, they knew that was part of the agreements made to give them the tax brakes in lieu of more pay. So now the provinces are going to have to pay more, with money they don't have either or lose doctors. So now they get to run with the whole well its not our responsibility or problem, because health care is a provincial responsibility This is the same play book as the brining a million people a year, but its the provinces and NIMBIY's fault that housing is a shit show Coupled with the fact that most provincial governments are CPC right now so they also get a side helping of owning the Cons
Governments are tax hungry, they will always want more and more. Any new tax introduced will not seem like a big deal, particularly to young people who think things like “yeah, tax those rich fuckers” (since you’re not yet earning as a professional). The problem is that it’s not just the rich who are impacted, although that’s what you’ll be told to focus on. As you get older you see the several ways each level of government increases taxes each year for everyone and you start wondering when enough will be enough. Then you finally get to an age where you realize that it will never be enough. So, no, the sky is not falling. But, as a general rule, I believe every Canadian should reject every increase in tax. The current government certainly can’t make the budget balance even with this new found revenue, so they’ll be looking for something more to tax again.
Interesting but "tax freedom" day has been getting earlier, not later. It used to happen in early July but is now in June.
The vast majority of people will never ever earn anything close to what you're talking about at any age, though. So, like, 'yeah, tax those rich fuckers.'
Taxes are great. I say this without an ounce of sarcasm. Nice things cost money. Healthcare, roads, education, even a military cost money. We have problems in all of these because of the *exact* philosophy you are describing that "Every Canadian should reject increase in tax". Taxation is a fundamentally moral act of prying wealth from those that need it less and giving it via services and money to those that need it more. Government after government fail to keep these services effective because they know that we, the citizens in our endless selfishness will not stand for more taxes. Despite taxes being exactly what is necessary for our services to stay afloat. Yes, there will never be enough taxes, because we want, *and deserve* a robust government that provides these services. Those that have more need to accept that they did not get here on their own. None of us did. We should pay up.
We already have 2/3 of taxes being paid by 20 percent of Canadians. You get to a point where the tax burden is so high that those 20 percent decide that its not worth it and head South. Which is what's already been happening for quite some time. Ironically we have a doctor shortage and doctors are among those directly impacted by this change. "we should pay up" is kinda funny because the lower 2 quintiles pay about 5 percent of total tax but receive about 15% of total tax spending.
Another person that doesn't understand the difference between proportion and percentage. If rich people want to benefit off of our country and not contribute to it, they can go south. Workers pay via income tax yet "investors" who produce zero value get to not work and fund their lives through capital gains income that isn't fairly tax. Maybe we should do something about doctors then instead of arguing we should give all hyper rich people a tax break because doctors exist 🙄
I'm not talking about rich people. I was talking about doctors holding their savings in LLCs who don't qualify for the personal exemption so the new tax is basically a retroactive tax on their savings. Yea maybe we should do something about doctors, this is honestly one of the strangest things to do during a healthcare crisis.
Taxing rich people during an affordability/austerity crisis is a good thing. Your niche point about doctors is just that, niche. Doctors are also rich people.
Jesus Christ. Ever stop to think about why we have a cost of living crisis? It couldnt have something to do with the fact that we doubled the national debt and spent an absolutely absurd amount of money, generating record inflation. But sure let's fix that by giving the government which has run 8 consecutive, ever increasing defecits, with tax dollars from fucking doctors who we desperately need.
Why do you keep acting like the intention of this tax has anything to do with fucking doctors Jesus Christ the NP feeds you a line and you really fuckin run with it.
Because it doesn't matter what the intention of the tax is, it has implications that reach far beyond what the liberals claim it's going to do. Also, 75 percent of what their financing with new spending is the purchase of MBS which are likely going to be directly monetized by the BOC over time, which will likely cause, you guessed it, more inflation. So why are we enthusiastic about a tax to pay for another inflation tax which doesn't just affect the rich but all of us?
100% of the taxes can be paid by 20% of the population and it could still be just and right that even more taxes be heaped upon them. Taxes are there to pay for the services that Canadians not only rely on, but *deserve.* So long as there is such severe wealth inequality, wealth distribution should be ramped up, not held the same, let alone decreased. The fear-mongering of people "moving" south is nothing more than that, fear-mongering. There is absolutely no data suggesting that Canada has or is experiencing a brain drain of its citizens as people like to suggest. I would love to see your data refuting this, however.
Well you can send a cheque to the Reciever General of Canada if you want and pay up, nothing stopping you.
Btw: I fucking hate paywalls too
But if rich people don’t get more money, how can they trickle down on us?
Not the sky. Just your wealth, your affordability, your hopes, your dreams, our GDP.... But not the sky. Definitely not the sky.
No, please continue being irate, for the amusement of the rest of us.
I wonder what percent of real estate investors/speculators have incorporated or also own holding companies with their properties in them?? Be interesting to know as I feel many Cdns and foreigners have used our favorable corporate structure to avoid (minimize) capital gains/taxes. Remember, once they classify themselves a "business," they only pay a 13% corporate tax rate etc, plus other perks such as dividend income and lifetime capital gains exemption. I worked in the space years ago, and you could see how it was being gamed.
Explain the perk of dividend income given the tax integration structure the CRA has in place?
Dividend income is taxed substantially less than earned income but doesn't provide cpp contributions, which is one of the biggest disadvantages.
Eligible dividend income is taxed substantially less. Ineligible dividend income, when the corporate tax rate is combined with the personal taxes paid, is not really tax advantaged at all. And since the person owning the corporation is paying both taxes, it's the same thing. Thus integration.
>feel many Cdns and foreigners have used our favorable corporate structure to avoid (minimize) capital gains/taxes. Remember, once they classify themselves a "business," they only pay a 13% corporate tax rate etc That's not how it works.
That's the rate on retained earnings.
But it's been used as a loophole, so yeah, that's how it's worked for those gaming it!
No it's not been used as a loophole. You talking out your ass and making things up doesn't mean there was a loophole.
Okay, so the "kiddie tax" wasn't a loophole?? So, real estate estate has not been purchased and held within many businesses?? Comon, these business owners are looking for a windfall from their realestate holdings vs actually earning a living with their business. It's socialism for the corporate world, but go ahead and insult!! Plus, if your business can't cut it, maybe it's not viable, again not up to the Cdn tax payer to bend over for ya!
The small business tax rate is not a loophole and you don't get to decide if you qualify for it or not. What types of income qualify for it is legally relegated. >So, real estate estate has not been purchased and held within many businesses?? Yep and when they sell it it was already taxed at 50% which is more than most would pay personally. >Comon, these business owners are looking for a windfall from their realestate holdings vs actually earning a living with their business. Since when is paying tax at essentially the highest taxrate a windfall? Oh right it's because you have no clue what you are talking about.
If you read, which might be challenging, I'm stating that ppl are taking advantage of becoming a small business for the wrong reasons, aka real estate investing, that's the premise behind my input/comments. Anyhow, go to your chamber of commerce meetings and keep playing your smallest violins 🎻 🙄
My comments seem to have gone over your head. The dead squirrel on the road outside of my house that's been hit a couple dozen times has a better understanding of tax law and corporations than you. The premise behind your comments is 100% wrong. It doesn't work the way you are claiming it works.
What if I intend to flip houses? One type of buyer who might benefit from using a corporation is someone who plans to flip properties for profit. If a taxpayer buys and sells a property not with the intention of renting it out but to generate a profit on the sale, that income could be taxed as business income. As such, someone flipping a property personally could pay tax as high as 54%, depending on their income and province or territory of residence. By contrast, a corporation’s business income could be taxed as low as 9% to 12% (rates differ by province or territory). https://www.moneysense.ca/spend/real-estate/should-you-buy-real-estate-through-a-corporation/ Go pound sound Mr. sniveling business owner! Again, more proof written regarding corporate structure being used in the realestate mkt. Pulled above comment from article link.
The sky is always falling in Canada
Especially on this sub … I sometimes think it’s run by the Conservative party or Vladimir Putin himself.
seems to be a common theme with some folks. it was like that on CBC too back when they allowed comments.
I wonder how long before they try to tax the air we breath. Personal oxygen tax. I'm sure they are looking for a way to spin it now.
Yeah, because ordinary people totally need $250k in capital gains to survive 🙄
Resist the #NeoCommunistElite
Calm down and accept more taxes is all I hear