Almost

Remember those yesterday stats breathlessly shared with you showing the fastest-ever 90-day plop in Toronto house prices?

Well, forget it. That 14.2% plunge was incorrect. Or at least stale. According to the internal numbers the real estate board doesn’t really want you to know, the situation has changed. Naturally, it’s worse.

The average GTA property was worth $919,589 in April – the most ever. But by July 13th that had declined to $755,727, for a rout of almost 18%.

So the typical property-owning family lost a tax-free $163,863 in 11 weeks. Ouch. That rolls prices back to the level of September, 2016. So much for those goofy months of February and March when everyone thought houses would go up by 30% forever. In fact, this reduction in average price expressed across the GTA (with just over 990,000 properties) means $162 billion in equity is gone. Poof. Floated away. Just like Kevin O’Leary.

“The real estate board has a fiduciary responsibility to represent both buyers and sellers,” says the realtor who provided this information – we’ll call him Reliable Source. “So this kind of data needs to be made public in a responsible fashion.” You bet. Some poor moister buying a condo right now with 95% leverage, ‘because real estate always goes up’ could be crushed by what’s yet to come.

“This market is goin’ down,” says RS. “Yes, it will eventually find a bottom and start to recover, because that’s what markets do. But things are not healthy.”

The long-time house flogger points to his own analysis of current listings, where he sees “a disproportionate number of vacant and rented properties” suggesting that amateur landlords and speculators “are doing everything they can to get out.

“You have to remember that people who own and occupy their houses are not gonna bail just because prices start to crash or mortgage rates go up,” he suggests. “So this market is totally different now with all that speculation that took place. It’s distorted and investor-driven.” And that’s why this correction is not going to end well.

Good luck with that soft landing. Splat.

But it could be worse. You could be a doctor.

Chances are your family doc operates in a clinic with a few expensive employees and a bunch of shiny equipment. He or she probably has no benefits, no pension plan, pays lots of overhead and, yeah, makes a few hundred grand a year. That puts him or her in the top tax bracket which, thanks to T2, now Hoovers away more than half of income.

The solution? Follow the law and split income with your spouse who, as a shareholder in your medical professional corporation, is entitled to a piece of the after-expense cash flow. You could also (like so many docs) live a frugal life on a modest salary or dividends while keeping savings within the corporation where they can be invested at a lower tax rate than in your own hands. Then, in retirement – when your income goes to zero – you can withdraw the money as income and pay tax on it at your lower marginal rate.

This is part of the reason we have doctors in Canada, where socialized medicine caps incomes. In some places they must be government employees while in other places they’re allowed to incorporate. But it’s not just medical professionals who use corps to be tax-efficient and compensate for the fact they spend eight years training or will retire without income support. Lawyers incorporate. Dry cleaners incorporate. IT dudes are increasingly forced to incorporate. And most of them pay corporate taxes and personal taxes while making employee benefit payments plus collecting/remitting HST without compensation.

Anyway, here’s the deal. They’re all ‘rich’ now, so Bill Morneau plans to eat them. As this blog forecast months ago, the hammer’s coming down. In the next budget you can count on (a) a test to ensure all shareholders are worthy of the money they are being paid and, if not, a tax rate of over 50% will be applied to their income and (b) full  taxation, at personal levels, of investment income earned within a corporation, making every doctor wish she’d taken a salary and exploited RRSPs.

Moreneau veiled this in a cloak of ‘middle class fairness.’ But it’s unfair when rules are changed for the express purpose of penalizing success, hard work, risk or the acquiring of skills essential to the public good.

Another T2 grab. Makes you wish for a Trump. Almost.

318 comments ↓

#1 FLHTK on 07.18.17 at 4:56 pm

Yup almost……

#2 Verdei on 07.18.17 at 4:59 pm

#171 Smoking Man on 07.18.17 at 1:55 pm

50k risk takers are going to get pummled, small biz owners, no pension, no UI when things go bad, no security other than wit and work ethic.

Looking forward to getting my disability pension.
-_-_-_-_-_-_-_-_-_-_

It’s good that money can be pooled to help the weak.

#3 OnlyTheBankersLaugh on 07.18.17 at 4:59 pm

Unbelievable. Government workers accumulating over $1M before 35 while doctors getting pounded while just establishing a $1M practice to begin earning paltry OHIP socialist doctor wages (compared to Trumpland). Just go into government kids and the private sector will pay you until there is nothing left.

OnlyTheBankersLaugh

#4 Stan Broock on 07.18.17 at 5:01 pm

Bill is stupid, the very definition of a brain-frozen Canadian idiot.

No country has ever succeeded in what he is taking on and he is stupid enough to persist with it.

OK. You have personal corporation, your spouse helps you (unquestionable and easy to prove), who will determine the degree/amount of help as to justify salary?

The stupid Bill and his rules?

Everything around professional corporation will become arbitrary and subject of interpretation by CRA, including the principle salary.

What if the family business with 2 adults working can drive 220 k in sales/income vs 100 k average salary for the principle, 50 k for the spouse on the market for full timers (benefits not included as stupid Bill does not consider lack of benefits for self employed in his calculations)

Is the argument that 140k/80k split is acceptable valid?

What if CRA rules based on Bill’s idiotic rules that only 50 k is acceptable for the salary of the helping spouse?

Would it not be logical to argue then the income on the principle should be taxable at 100 k , not at 170 k based on Bill’s stupid rules?

Do you realize the idiocy of this?

Why not implement family income as in other reasonable country?

Stupid Bill? Back to you.

#5 BobC on 07.18.17 at 5:01 pm

I knew it – I just knew it. I said before to long you’ll be begging for your own Trump! Another couple of years under socialist policies and you’ll leave off the “almost” at the end of that sentence.
You can see though how hard it is to reverse things. When more then half of the population belongs to the free $hit bunch they won’t give it up easily.

#6 C'mon on 07.18.17 at 5:03 pm

C’mon Garth. Tax rates are high for everyone in Canada compared to the Wild West of the US, that’s part of living in a civilized state with public infrastructure and a safety net.

I didn’t cry for the doctor’s lobby when they fought Universal Healthcare, and I won’t cry for them today when they’re asked to pay a similar tax rate to their patients.

The marginal rate may be high for them, but let’s discuss the average tax rate. I bet they are doing just fine.

#7 Millennial905er on 07.18.17 at 5:08 pm

“Moreneau (sic?) veiled this in a cloak of ‘middle class fairness.’ … Another T2 grab. Makes you wish for a Trump. Almost.”

Not almost. It does. And as much as I wanted Maxime Bernie (PCs/Dairy farmer lobby) pooched that one, I’m considering the Scheer loser for my next vote.

Between T2 double speak and 241 million dollar donations to the Clinton foundation, this government has overstayed its welcome.

https://www.therebel.media/trudeau_gives_clinton_foundation_241m_from_canadian_taxpayers

Incidentally, the Trudeau government should have just flushed that money down the toilet, since audits of the Clinton Foundation have indicated only a minute amount goes to charity

https://medium.com/@willpflaum/clinton-foundation-audit-of-2011-found-7-of-expenditures-went-to-charity-10-to-travel-and-events-fdbbb54ca090

I guess it could be worse; We could have Hillary.

#8 Ole Doberman on 07.18.17 at 5:08 pm

Amazing how fast the GTA is deteriorating yet Calgary with the brunt of the oil fall out still stands with only a few percentage points down – there is no justice.

#9 Willy H on 07.18.17 at 5:10 pm

That 14.2% plunge was incorrect. Or at least stale. According to the internal numbers the real estate board doesn’t really want you to know, the situation has changed.

… But by June 13th that had declined to $755,727, for a rout of almost 18%.

… So the typical property-owning family lost a tax-free $163,863 in seven weeks. Ouch. That rolls prices back to the level of September, 2016
___ ___ ___ ___

Now, that’s more like it!

It’s year over year price drops that will indicate that this bloated and unsustainable bubble is finally popping.

This “unofficial” statistic is much more promising than what was outlined in yesterday’s post.

#10 Randy on 07.18.17 at 5:11 pm

Just a reminder. If you are still alive and working in 2019, you payroll deductions for the Enhanced CPP are going up by another percent. (2% if you are self-employed). Thanking you all for your contributions to pay for the underfunded pension plans of your government workers.

#11 Lumpia on 07.18.17 at 5:12 pm

It’s going to be a terrible halloween and the grinch will ruin christmas for the horny fruitcake mortgage guzzling sheeps! Happy housing crash everyone!

#12 Stan Broock on 07.18.17 at 5:12 pm

I will take Trump before stupid Bill and J2 at any time.

No wonder the conspiracy theorists are getting increasing popularity with this type of idiots in power.

Scary and in a way fulfilling (almost orgasmic by the pleasure of not being ruled by these people any more)

#13 Mike on 07.18.17 at 5:15 pm

.

With all fairness, hats off to Trudeau on bringing this fake professional corporation issue to the front.

I know a doctor who earns $450,000+, but “pay wages” to wife and daughters and in the end pay taxes only on $100,000. everything else expensed, or ‘loaned’ to relatives.

Wife does nothing but cook at home. Kids go to college.

I have NO problem allowing this tax fraud for Doctors/Lawyers. But allow such for middle class wage earners too. Let me pay my stay home wife a salary, and let me deduct it from my salary as expense.

And, we haven’t talked yet about getting money from those fake corporations as dividends and fake loans to relatives and fake lunch/dinner expenses…..

Go Trudeau!! Fairness for middle class, or just allow me(a salaried employees) to give further ‘salaries’ to my spouse/kids and expense my personal lunches, gas, leased cars, dinners, vacations(to attend conferences)…oh no…that won’t be fair, right.

#14 Kayaker on 07.18.17 at 5:18 pm

Living in the confines of heartless Ontario I recently returned from a road trip out East. Life in Nova Scotia is truly a much more kinder, gentler and refreshing pace then that of Toronto and surrounding areas. With 2 kayaks strapped to the car we camped at some of the most scenic and wonderful provincial parks in Nova Scotia at a mere $31 per night and paddled the clean and bountiful lakes. It was sad to return as once we reached Trenton on the 401 you suddenly felt the grip of impatience and rudeness surround you!!

Working in the Insolvency industry for over 8 years a steady trend seems to have taken place with little in abating the issue – car financing. We often speak with debtors about using a simple calculation in keeping a budget somewhat in line. Based on net income, one should spend 35% of living expenses (home ownership / rental, household expenses, insurance, ect) 25% for life (food, entertainment, ect) 10% savings, 15% for debt servicing. 15% transportation. Though this is just a simplified approach it shocks me how so many will gear nearly 30-55% of their budget towards vehicle financing (financing, fuels costs, maintenance , insurance). Most here note of the high cost of home ownership and I completely agree but what some may not know is that the family vehicle(s) is becoming the financial hardship that is given little attention too.

Live simple, enjoy the free things in life and paddle this country’s great waterways!!

Keep up the awesome job Garth, I may never be a client of yours but I so appreciate all that you do.

Yak!!

#15 Stan Broock on 07.18.17 at 5:18 pm

Soon these idiots will star questioning the incorporation
process itself. Ever wondered why Canada has 1 (one) company in the top 100 startup lists?

Now you know/ But hey, the guy has a great hair-do….

#16 Lou Hanford on 07.18.17 at 5:19 pm

Mass Exodus of Doctors to the USA? Healthcare is about to go up in Canada, but since the doctors are paying more in taxes, that money will go right back into recruiting doctors to come to Canada to practice.

#17 X on 07.18.17 at 5:21 pm

Hmmm…how about some sort of pensions or something to actually help middle class people, as opposed to punishing those who have done well for themselves. Wouldn’t that be middle class fairness?

I mean there is alot of middle class without pensions, who would love some sort of actual help (even further tuition help), as opposed to see their employers punished with more taxes.

Getting a little sick of the tax the rich mantra….that and selfies is apparently a good angle to get votes though.

#18 Post on 07.18.17 at 5:24 pm

“Another T2 grab. Makes you wish for a Trump. Almost.”
———————————-
….or maybe Maduro, Il-Sung, Ergodan, al-Assad, Putin…

#19 Stan Broock on 07.18.17 at 5:24 pm

#13 Mike on 07.18.17 at 5:15 pm

You are STUPID.

Your doctors is disclosing his/her/zer financial affairs with you? Sure.

Just keep in mind that the doctor – he/she/zer is making twice less in nominal income than his/her/zer’s/ US counterpart.
Maybe 3 times less in real terms.

So when you get cancer or diabetes please go somewhere else to get treatment as I believe every Canadian doctor should simply reject servicing such idiots including the stupid bill and j2

#20 Question on 07.18.17 at 5:26 pm

A question: how are corporations currently able to convert income into capital gains via multiple corps, to lower their tax rate? On of Morneau’s measures is to address this. It indeed sounds like a loophole, but without understanding the technique I am open to the possibility that it is currently possible for legit reasons.

#21 Willy H on 07.18.17 at 5:29 pm

Mike on 07.18.17 at 5:15 pm

With all fairness, hats off to Trudeau on bringing this fake professional corporation issue to the front. …

___ ___ ___ ___ ___

Totally agree, I remember a small business owner I worked for paying his daughter a $100K to sweep floors while skilled machinists around her were paid far less.

#22 PRECS on 07.18.17 at 5:29 pm

Most realtors are structured like Doctors , there all PRECS or pricks as I call em. Not to mention contractors, consultants etc. Expect a uproar if this becomes reality

#23 FOUR FINGERS WATSON on 07.18.17 at 5:31 pm

Big whoop de doo about not much. It won’t affect the average Canadian family or make homes more affordable for them. What you should worry about is the upcoming NAFTA negotiations cuz the US wants access to our banking system and telecom industries.

#24 Damifino on 07.18.17 at 5:33 pm

I remember it clearly… like it was yesterday

T2 said there would be a 10 billion deficit for the first three years of his mandate followed by a balanced budget in the fourth. He said that, didn’t he? When, exactly, did he stand up in the house and take it back?

Looks like he needs more cash. Lots more cash. Will OAS means testing be next?

#25 Stan Broock on 07.18.17 at 5:34 pm

#20 Willy H on 07.18.17 at 5:29 pm

Good look with finding a doctor when you get sick.
Maybe stupid bill or J2 will help you out of their fortunes (these are 0.01 per centers)

#26 Victor V on 07.18.17 at 5:34 pm

“My cab driver is telling me that every real estate agent he talks to is telling him to take a HELOC against his house to buy a 2nd property” – John Pasalis, President at Realosophy Realty

https://twitter.com/JohnPasalis/status/887298908837294080

#27 X on 07.18.17 at 5:36 pm

re#13 Mike:not disputing that some misuse the corporations to shelter funds payable to family members.

However, ‘about getting money from those fake corporations as dividends and fake loans to relatives and fake lunch/dinner expenses…..’. All corporations do need to keep proper books for expenses and any business loans made. Corporations are also subject to RC audits, so you can’t just make stuff up. In regards to dividends, that really is a wash, if you compare it to salary, and the associated taxes.

The passive salary discount, does help to buy equipment sooner, which in turn allows the business to grow at a faster rate, and inturn if you buy Canadian products, helps the economy. (ie more net jobs) I don’t really know why the Liberals would want to alter this one, as if you don’t eventually spend the money on the business, you will eventually be taxed when you withdraw it from the corporation.

Sometimes, perhaps it is best to just have a teacher/government type job. Less education, good pension, no business loans, less risk, better hours, more holidays. Liberals starting to sound a little socialist.

Garth what is the link/website to voice our opinions on this, there is a consultation period, yes? I am guessing this is like the Liberals last consultation period where they travelled around the country getting Canadians opinions, but it was basically a done deal.

It’s a done deal. — Garth

#28 AGuyInVancouver on 07.18.17 at 5:37 pm

#17 X on 07.18.17 at 5:21 pm
Hmmm…how about some sort of pensions or something to actually help middle class people, as opposed to punishing those who have done well for themselves. Wouldn’t that be middle class fairness?

I mean there is alot of middle class without pensions, who would love some sort of actual help (even further tuition help), as opposed to see their employers punished with more taxes.

Getting a little sick of the tax the rich mantra….that and selfies is apparently a good angle to get votes though.
__________________
Where do you propose government get money to help the middle class? Tax the poor?

#29 Goldie on 07.18.17 at 5:43 pm

These idiots shouldn’t be messing with doctors.
And damn rights I’d take Trump over T2, at least as far as domestic policy goes. Gen:Snowflake can suck it!

#30 Mike on 07.18.17 at 5:44 pm

#19 Stan

Stop throwing profanities. Everyone knows how these professional corporations work. Basic tax cheating by expensing personal expenses.

Oh, then Doctors can move to USA. Trump is welcoming with open arms. Or maybe to Russia if Canada doesnt suit you.

Why aren’t they moving? Can make twice as much money, right. Do they let you pay fake salaries to spouses and kids? Good for you. Do, move. Border is open, nobody stopping.

#31 Gary in Kelowna on 07.18.17 at 5:48 pm

This news from Morneau and T2 comes on the same day that Comrade Horgan and the Bolsheviks take over here in BC. So the message from these Governments appears to be: “Don’t aspire, work hard, succeed enough to be able to look after yourself. The Socialist Hordes will be ready at the gate to take most of your earnings from you”.
So discouraging.

#32 BC_Doc on 07.18.17 at 5:49 pm

@Mike My wife is a nurse. Her former employer for whom she spent 10+ years working insisted on paying her as a contract worker. Her income from their went into the medical corp which paid the 4.95% CPP her other employer should have paid before cutting her a salary cheque (total CPP withholding 9.9%).

I live by my rule of 1/3s. 1/3 of what I earn gets spent today, 1/3 gets saved in the corp to invest for retirement, and 1/3 goes to the CRA today. That’s the frugal living that Garth talks about. Self-investing/DIY investing using my Simpleton Portfolio (VXC-T, VCN-T, VAB-T, and a smattering of GICs), I’ve done well over the years. When I spend this down in my retirement, CRA will collect a tidy sum. The risk was mine, but the CRA will get rewarded too. Or the Libs could get greedy and come for it now.

Our cars are a 2005 minivan and a 2009 truck. No Porsches, Audis, or BMWs. Our house is nice but modest (2800 square feet). I’m an ant, not a grasshopper– while the sun is shining, I believe in working hard, saving+++, and investing so my spouse and I are in good shape when winter comes as it always does. Hard work and saving aggressively has made me a 1%er in T2’s eyes. Junior consequently wants to eat me for lunch. Once he’s done having the docs, dentists, and lawyers for lunch, you may want to ask yourself, who’s next on his plate for supper?

#33 TortyPapa on 07.18.17 at 5:50 pm

Well…. at least they aren’t going to get rid of the Professional Corps altogether. That would have been awful.

I am a professional and is incorporated. I make a good income so I don’t mind paying the tax but give me a break on the “We are taxing the rich” bullsh*t.”

People who work harder and are taxed more gets nothing else more than any other lazy person in Canada. Give me a high tax bracket lane on the highway? Or maybe a priority lane at the emergency when something happens?

#34 Stan brooks on 07.18.17 at 6:02 pm

#30 Mike.

They/the doctors are moving. You just don’t know it yet as you are stupid and I guess still healthy. Wait once you get sick with serious illnes, then you will realize what a hellbhole you are living at. Stupid bill and j2 will go to US or Switzerland for treatment while you will becwsiting in line for the next available specialist.

Let me guess – government parasite who never had to actually work? Good luck my friend.

Bye.

#35 Smartalox on 07.18.17 at 6:03 pm

Why kvetch about the doctors?

This announcement cited the ‘explosive growth in personal corporations in the last few years’ as one of the reasons for this move at this time.

But here’s the thing: Canada hasn’t suddenly produced a massive number of new doctors in the last few years. No great rise in graduation rates for dentists or lawyers, either. So where is this ‘explosion’ coming from?

Personal Real Estate Corporations. You ever wonder what the letters ‘P.R.E.C.’ mean in small print next to the names on realtors’ advertisements? It means that this ‘professional’ has structured his or her business to take advantage of these income structures.

This is the sector where so much growth has occurred in the past few years, with agents cashing massive commission cheques like never before, and doing everything they can to avoid taxes on their incomes.

If you sell 5 houses a year, and take home $250k in commissions, you’d be in the top tax bracket, period. Invest that money in your ‘corporation’ and you can do all kinds of fun things, including writing off investment losses (from bad property deals), as well as things like luxury cars and masseuses. And no income cap for you!

Then, in the lean years, you continue to take dividends out of your corporation, even when the phone stops ringing.

It’s not a bad play, reducing income taxes in busy, well-paying times, deferring income to times when things aren’t as busy. In the end it’ll all work out, right?

Another side benefit of self-incorporation? If the ‘corporation’ declares bankruptcy, the shareholders are the first creditors to be paid, and debts are in the name of the corporation, not the person who owes them.

#36 Stan brooks on 07.18.17 at 6:06 pm

#30 Mike. When scum like you starts talking on behalf of Canadians it becomes interesting.. who gave you that right? The fair share bill? You go to helll my friend.

#37 MF on 07.18.17 at 6:06 pm

We want Dr’s to be paid extremely well and have many tax incentives and benefits. This is done so we attract the best and brightest only. So far so good.

On the other hand, we’ve had stories on here of Dr’s earning 500k (anesthesiologist). Which, in addition to the tax breaks, might be excessive. We’ve all seen movies, or read in the news about highly paid doctors who begin to act invincible. A middle ground is important.

Our Dr’s are, for the most part, pretty good. I don’t like Morneau, and this socialist idea of tax big and spend big is a complete failure everywhere it’s tried. I guess I am slightly against these upcoming changes.

MF

#38 TheDood on 07.18.17 at 6:08 pm

#16 Lou Hanford on 07.18.17 at 5:19 pm
Mass Exodus of Doctors to the USA? Healthcare is about to go up in Canada, but since the doctors are paying more in taxes, that money will go right back into recruiting doctors to come to Canada to practice.
_________________________________________

Yup. That will probably be the fallout. Fewer Dr’s, longer wait times, an even crappier health care system than we already have. Healthcare and Education are supposedly where the lions share of our taxes are supposed to go, and even though more tax dollars are being collected than ever before, our dumbass government finds a way to ensure a system already in bad need of overhaul becomes even more expensive and less efficient! How typically Canadian!

#39 Bill Grable on 07.18.17 at 6:09 pm

Here in delusional Vancouver, you can just about feel the angst in the smoggy (*forest fires) air.
Shacks for $2 million. Rents? Try, I have seen ads asking $3000 plus for a tiny 2 bedroom.

Everyone is freaking out – but trying to act cool.
When the rates go up a bit more, this small avalanche will build and bury a TON of people in a mountain of debt. Many of my coterie (Boomer) are retiring and thinking they can pay off that “Line of Credit” and all the credit cards, when they sell their home. Sell to whom?
The Sales in the GTA have gone south, and it’s starting here. It is going to be a long ugly slog – BUT – if you have been following Mr. Turner, you know all this.

Get rigged for heavy weather….I am going to put a reef in the main sail….and stay out of the way of the oncoming train. Vancouver has been turned into a cornucopia of construction – and has destroyed whatever character this City once had. The condos are being slammed up – and I wonder who is going to buy them all? Here’s a hint – I rent in a building where the majority of the owners live in China. How can they buy these very expensive joints, when they are only allowed to take a relatively small amount of cash, out of China?
Something smells.

#40 jay on 07.18.17 at 6:12 pm

Sounds like a good idea to make these changes ,I work with people that avoid taxes by claiming self employed status while working for the same company full time. https://www.theglobeandmail.com/news/politics/ottawa-to-cut-back-on-income-sprinkling-by-doctors-and-other-professionals/article35717410/

#41 common sense on 07.18.17 at 6:13 pm

Next up…Means testing.

RRSP, TFSA, House value, Bank balances…did I leave anything out?

The last place in any country where you want to be is the middle class.

#42 BobC on 07.18.17 at 6:16 pm

#13 Mike
You know what to do. Put everything you have on the line and start your own business. Careful who you hire though.

#43 James on 07.18.17 at 6:16 pm

#30 Mike

I actually doubt you know how PCs work, sorry. PCs get audited on a regular basis. You can’t just claim that you paid a 100 000 salary to you spouse for cleaning floors since the CRA will very easily argue that is way above reasonable price. You also can’t charge personal expenses to your corp. You will get caught, believe me.

There is fraud with pcs like anything but the CRA keeps a very close eye on them I can assure you.

I do have to agree with our FM that income splitting using divdends (which is what perhaps your DR friend was doing as opposed to paying a salary to his spouse) is arguably unreasonable. Closing that loophole might make sense.

#44 JSS on 07.18.17 at 6:18 pm

Yeah I feel so sorry for doctors. Imagine how their wives must feel. They will now have to settle for an Aldo handbag rather than a Burberry.

#45 Winston on 07.18.17 at 6:19 pm

Welcome to Canada (Cuba):
Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery.

#46 MF on 07.18.17 at 6:19 pm

#10 Randy on 07.18.17 at 5:11 pm
#34 Stan brooks on 07.18.17 at 6:02 pm

A little tired of hearing this. There are mass layoffs in the federal government where a close family member works in the GTA. Any news stories on it? Nope. All new positions are contract, no pension at all. It’s the older workers who you are referring to perhaps.

There is nowhere to hide anymore.

MF

#47 Alberta Ed on 07.18.17 at 6:21 pm

That’s what you get when you elect a prime minister and finance minister who are born silver-spoon socialists. BTW, don’t expect the government’s propaganda arm — the CBC — to explain the implications of this legislation. Or the what’s really happening in real estate, either.

#48 Guy in Calgary on 07.18.17 at 6:22 pm

“#8 Ole Doberman Amazing how fast the GTA is deteriorating yet Calgary with the brunt of the oil fall out still stands with only a few percentage points down – there is no justice.”

I don’t think an average looking single detached in the burbs here in Calgary was costing $1.2M. The speculation also wasn’t as rampant, that was all happening to the West of us instead. Amateur landlords here got hurt but that happens all the time.

That’s partly why I moved here. Lot’s of good people who aren’t perfect by any means but just want to work and make an honest living. All the talk from Ontario about people here being spoiled with oil money and greedy is so over exaggerated it isn’t even close. I’ve lived in both places so I actually speak from experience.

GTA people, this is a healthy and needed correction. Unless you took out a HELOC and maxed it out or are a spec looking to flip, you’ll be fine, just stay the course. Or sell at a loss whatever you wish. Sold my St Catherines property at a giant profit in 2016. Good timing by me.

#49 JSS on 07.18.17 at 6:23 pm

If doctors don’t like the new rules, then they can GTFO to the states. Canada currently has a good supply of immigrant doctors, as well as Canadian medical students who will want to stay and contribute to this great country.

What’s wrong if they pay a bit more taxes? If you want to live in a nice country like Canada, you gotta pay to play. Lots of bluster like “oh, I’ll just move to the States”. At the end, hardly anyone goes. And the ones who do, most of them end up coming back.

#50 Karma on 07.18.17 at 6:24 pm

#17 mouldyinYVR on 07.17.17 at 7:15 pm
https://www.locatehomes.ca/bc-real-estate-“listings/coquitlam/mls-R2171014/217-3098-Guildford-Way-Coquitlam-V3B7W8?id=262192641

“Court order sale, 2 bedroom condo, great location steps to La Farge Lake and shopping. This sale is for the HUSBANDS interest ONLY …the listing price is for half ONLY.”

…..gotta love this listing…………Wow, maybe we have hit the top …at least in YVR suburbia…….don’t think I’ve seen a listing like this before…sounds desperate!”

Saw one like this in Metrotown area of Burnaby, but was the wife’s half. Was cheap enough to get me interested if it was available at the grossed up 100% price.

#51 waiting on the westcoast on 07.18.17 at 6:25 pm

Hey Mike – I think all salaried employees should get to incorporate. I also think they should not be able to claim EI and not get a pension… Then it would be a more even playing field.

Yes, small business owners including doctors and other professionals get some perks. They also do not get the same benefits from the system.

#52 Dustmaker on 07.18.17 at 6:28 pm

About that real estate…
I don’t think this is it. Somehow, as crazy as it sounds, this will continue.
After taking a short pause this summer, the prices will continue to rise.
We probably need another 2 years, or 1.5% -2% higher mortgage rates for it to reach a tipping point.
But whatever happens after that, we will not see 3 times average family income detached homes in Greater Toronto.
It will be closer to 7-10 times on average. Lower only when dramatic recessions occur or mortgage rates go to double digits.

#53 Karma on 07.18.17 at 6:28 pm

#104 Myra Andrews on 07.17.17 at 11:09 pm
“July stats for Vancouver area
Below is for Metro Vancouver but not the Fraser Valley

July 17 New 362 Sold 162 TI: 9767
July 14 New 164 Sold 109 TI: 9698
July 12 New 288 Sold 184 TI: 9702
July 11 New 282 Sold 148 TI: 9635
July 10 New 399 Sold 147 TI: 9576
July 6 and 7 New 387 Sold 273 TI: 9404

Both real estate boards GVRD + FVRB

=====New Sold Sell List %
July 17 477 228 47.8%
July 14 319 145 45.4%
July 13 301 251 83.4%
July 12 448 243 54.2%
July 11 444 251 56.5%
July 10 588 224 38.1%
July 7 368 201 54.6%
July 6 374 225 60.2%
July 5 502 231 46.0%
July 4 696 195 28.0%”

Thanks for this.

#54 Tony the Gino on 07.18.17 at 6:29 pm

I dunno man. House prices keep rising in Woodbridge. The more negative the news the higher people list their property. I’ll never afford a house again. Sad!

#55 Guy in Calgary on 07.18.17 at 6:30 pm

I am not sure how I feel about these new rules for CCPC’s. I agree there are likely people abusing it but you see it a lot here in Calgary. If someone incorporates themselves, companies hire them on but do not have to pay them any benefits. No medical, no dental, no CI/disability insurance, no pension, no RSP’s and no taxable benefits. NO SECURITY. The trade off is preferential tax treatment. I think that is completely reasonable.

Switch the government pension from defined benefit to defined contribution. That should free up a few billion.

#56 Dekard on 07.18.17 at 6:32 pm

I can understand income splitting between family members monitored to some degree. But I fail to grasp the reason for “bulk” taxing service corps’ retained earnings (if that’s the case)when tax integration already exists.
Maybe the want their tax revenue now? Maybe it’s time just to throw in the towel and retire….to hell with it.

#57 Blobby on 07.18.17 at 6:37 pm

Well the money I spent incorporating last year has gone down toilet then.

Back to being soul proprietor i go..

#58 jess on 07.18.17 at 6:40 pm

BOSTON) A record-breaking verdict awarded yesterday by a California jury against the TransUnion credit reporting agency demonstrates the importance of class actions and of strong consumer protection laws, according to advocates at the National Consumer Law Center. The jury awarded a nationwide class of over 8,000 consumers nearly $60 million in statutory and punitive damages. The jury found that TransUnion violated the Fair Credit Reporting Act when it carelessly misidentified the consumers as terrorists and criminals in their credit reports, confusing the consumers with similarly named individuals on a government watch list. The verdict is the largest FCRA verdict to date. ,,

They noted that Trans Union had defended its poor matching procedures by arguing that consumers weren’t financially harmed by the inaccuracies.

“TransUnion falsely tagged innocent consumers as potential terrorists or drug dealers and then decided it was ‘no big deal’ because the consumers didn’t lose any money.

#59 Willy H on 07.18.17 at 6:41 pm

#14 Kayaker on 07.18.17 at 5:18 pm

Your post explains why I see so many luxury vehicles around me on the 401 everyday. (Mercedes, Audi, BMW, Acura, Lexus etc.). Vehicles normally the preserve of the 2%’s driven by over-tattoed middle class Joe’s (and Joettes) who cannot afford RESP contributions for their children (let alone retirement savings). They breed like rats in a low interest rate nest and feast on GTA Mandarin buffets and Krispy Kreme donuts. They cut you off, park where they please (especially the sidewalk in front of your local Walmart entrance) and pass you on the highway with a certain air of self-importance while staring vacuously at their smartphones cruising at 130km. They spend half their lives in Tim’s drive-thru’s (their bloated children sipping on ice caps and hovering up 12 packs of McNuggets in the back seat) and the other half blaming government for all their problems!

Yes, I also agree that getting out (safely) on Canada’s beautiful waterways in a canoe or kayak is the next best thing to owning a dog!

#60 noob10 on 07.18.17 at 6:42 pm

With less doctors Canada can also further ration health care. Younger people with potential to earn money and pay taxes and debt interest, can get in quickly, while older or sicker people can go onto waiting lists.

#61 Smoking Man on 07.18.17 at 6:47 pm

Etobicoke market up date.

House one street over on 38th that sold in April for 1, 060, 000. Deal fell trough. Re listed sold yesterday for 1, 010, 000

My truck broke down while giving away clothing and furniture, that’s karma I guess. Took CAA 3 hours to come get me. A house accros the street for sale. In those 2 hours 4 people visited.

Like I said before averages to not tell the true story.
Whats driving it down so much is houses that sold for 2.5 are now going for 2.1

And listings are coming off the mls. Might see a mini surge as pre approved buyers pounce to lock in the low rate.

#62 Xbox Economist on 07.18.17 at 6:48 pm

We will asking nothing.

We will demand nothing.

We will take.

-CRA 2017

#63 dr. talc on 07.18.17 at 6:48 pm

Wow, 17 thousand civil servants, waiting for the coffee wagon, signed an internet petition to ‘make the rich pay’. And wage slaves come here and applaud.
I might as well break the bad news to ya’ll, Doctors, lawyers, business owners etc have brains and are capable of adapting ha ha. Typists, you’s bin had again, this is just M fooling you into thinking he even thinks about you ha ha, read his bio.

#64 cecilhenry on 07.18.17 at 6:48 pm

Not almost. And its not about Trump. Never was.

Taxes need to go DOWN. Everywhere. Stop stealing my labour and pretending its just.

Steal from the productive: envy as social policy.
A serf paid 10% in taxes, and we pay 50% (and its not enough). NO MORE

So many people who imagine themselves as peaceful and non-violent are only too happy and insistent that the state use force and violence against others to control their private lives and resources.

Forced redistribution of income is theft.

Government is just a set of people with its hands on the levers of an amoral but obedient weaponized bureaucracy.

Government regulation and coercion in Ontario and Canada is just insane. Why work??? WE have communism. The government control wages and incomes AFTER the fact with taxation. The government takes 50% of everything.

If you work hard then it is simply given to someone else by force. Bureaucrats love regulation as it justifies and entrenches their power and income. If you have a business well by God do your best to hire NOBODY or you will find yourself working for your employees instead of the other way.

Canadians do not exist to support the economy, fill labour quotas and run businesses. This is backward, parasitic and Slavish thinking.

#65 AB Boxster on 07.18.17 at 6:49 pm

So lets see…

The sunny government has broken pretty much every promise they made to get elected.

They have pissed off average wage earners by removing every tax credit that once existed.

They continue to push feel good, do nothing, citizen bankrupting policies such as carbon taxes, and green energy follies driving up the cost of basic goods that are required for survivlal such as electricity, heat, and food.

They have angered the native folks by breaking their promises and totally messing up the ill conceived missing women’s hugfest.

Their decision to make Mr. Terrorist a rich guy is disapproved of by over 70% of Canadians.

They can’t balance a budget to save their lives.

And now, they are going after the professional class because they are so massively wealthy. (not)

Anyone that votes for these fools, is, as my dad used to say: ‘Dumber than a sack of hammers’.

#66 Alex on 07.18.17 at 6:51 pm

well, I’m a doctor and I do fully agree with Morneau !
I am not incorporated and do pay back more than 50% of what I earn to our country.
It’s time that all my colleagues do the same, as well as everyone having a ‘fake’ inc. just for the sake of saving taxes.

#67 Flynn Holtum on 07.18.17 at 6:53 pm

It’s easy to predict what will happen now. Very easy. Doctors will say ok, fine under the new tax rules I’ll cap my income at $250,000 per year and work half time. Instant bull run on personal freedom and less incentive to work hard now. Or, could they start to jack up fees for simple things like sick notes to $100 etc. Gotta pay the bills somehow! At any rate.. no point in working any harder if it just goes to Bill Morneau. Welcome to the new semi-retirement top wage earners!

#68 S.Bby on 07.18.17 at 6:54 pm

#34 & #36 Stan Brooks

calling someone “stupid” 2X “scum” 1X
When you can’t make your point without insulting someone then you have no point to make. Go away you are of no value to this blog.

#69 Dr. on 07.18.17 at 6:57 pm

#19 Stan

And you are presumably a doctor. Please go to USA, please ….

#70 Marcus on 07.18.17 at 6:58 pm

Four sad but accurate words. “I told you so.” Canadians are in real trouble. Sad to see.

#71 After Communism on 07.18.17 at 6:58 pm

We should go back to market pricing for healthcare because the single pay commissar is not able to set wages (after these tax increases) for doctors and price of procedures, without making shortages and excess payments.

Communism always fails because there is no way to know the correct, after tax, doctor and nurse salaries and correct price for services without a market.

USA is highly socialist/semi-communist and highly taxed, same as Canada and their pricing is too much insurance-based oligopoly pricing, not competitive posted prices.

Most medical service should be paid by the user, not the single pay commissar. We only need catastrophe insurance, not birthing, broken bone, and prescription insurance.

#72 Smoking Man on 07.18.17 at 7:00 pm

Liberal activists never had any real opposition in Canada. We typically let these mental cases babble on. To deep into our wallets now. The right is on the rise.

Im calling for the extinction of both federal and Ontario provincial liberals next elections.

#73 Howard on 07.18.17 at 7:01 pm

“Chances are your family doc operates in a clinic with a few expensive employees and a bunch of shiny equipment. He or she probably has no benefits, no pension plan, pays lots of overhead and, yeah, makes a few hundred grand a year. That puts him or her in the top tax bracket which, thanks to T2, now Hoovers away more than half of income.”

This describes my father. A physician who worked his butt off. Well paid, yes, but not wealthy. As you say, retirement completely self-funded. And yes, he incorporated, and transferred whatever amounts he was allowed under the law to my mother, myself, and my siblings in order to reduce his tax bill.

Thankfully my father, now in his 70s, is winding down and will be fully retired soon, so these confiscatory measures won’t impact him. Or I’m assuming not….surely the Liberals aren’t evil enough to make some of this retroactive?

Canada already does a great job of chasing away its tech and managerial talent by offering crappy salaries, sometimes half of what one could make for an equivalent in most US cities, coupled with a higher cost of living and of course a nifty housing bubble. Now it’s going to force doctors and lawyers south of the border and beyond its shores.

Let’s be clear – doctors are not “rich”. These are people earning $200K a year under very stressful conditions, not hedge fund billionaires. And not loafing trust fund sprogs and revellers of mediocrity like the current Prime Minister.

The more I see of this federal government, the more I’m convinced that a bailout for indebted home-owning parasites is on the way. Punish the high-achieving and coddle the mediocre. It’s the Canadian way.

#74 Greg on 07.18.17 at 7:02 pm

Glad Morneau had the brains to change the rules to prevent the rich from getting more tax breaks than many of us wage earners. Nice to see that they will have to pay their fare share of tax instead of taking advantage of a loophole to avoid taxes.

#75 john on 07.18.17 at 7:02 pm

Moreneau veiled this in a cloak of ‘middle class fairness.’ But it’s unfair when rules are changed for the express purpose of penalizing success, hard work, risk or the acquiring of skills essential to the public good.

But housing speculation is still tax free. What kind of message does that send?

#76 R on 07.18.17 at 7:02 pm

No one is going. In order to go you have to sell your house. Oh wait who is going to buy

#77 Wait There on 07.18.17 at 7:03 pm

If there is fairness, then the government employees should have all the benefits of pension plans, med plan, education plans, extended holidays taxed as well. Let’s see how well that will work.

I see this as a Trump tactic by T2. Divert the attention of the middle class to the small portion of professionals. T2 is afraid that the middle class will start looking at government employees with the golden benefits. Government employees is a large part of the workforce now. Too much actually.

#78 john on 07.18.17 at 7:03 pm

Moreneau veiled this in a cloak of ‘middle class fairness.’ But it’s unfair when rules are changed for the express purpose of penalizing success, hard work, risk or the acquiring of skills essential to the public good.

Housing speculation, being a benefit to our society, is still tax free. Great job!

#79 aa3 on 07.18.17 at 7:04 pm

I look at it like this, the government of Canada can borrow money at say 2% per year on a 10 year bond.

If by deferring taxation, such as in corps, RRSP, etc.. people can make a rate of return on that money above 2% – then in the long run the government of Canada is winning on this. As eventually when that money comes out, the government will collect the taxes.

Where I do agree is its not fair for middle class earners in their jobs, if they don’t have access to as much means of deferring income tax and splitting income as the owners of small businesses.

I would extend income splitting to all couples.. its something that makes a big difference for many retired people.. for example on the OAS clawback.

#80 Keith on 07.18.17 at 7:05 pm

This is what happens when you lose enough of the working class, and working middle class. Forget the blame game. I can remember in 1985 in Victoria Safeway grocery workers earned $16 per hour, that’s a cool 32 years ago. How many Safeway workers earn $16 per hour today? My guess is not many.

So if you go from a world of low unemployment, and paying a living wage for a family to working people, and go to todays unemployment/underemployment/frozen – declining working wages and yes, ever increasing income and wealth inequality you have to get revenue from someone. If working people are losing ground to inflation, and many are, then someone’s taxes are going up. Trudeau is taxing where the money is, because the middle class is shrinking, and poverty is persisting. Doesn’t matter who or how you blame, we need the revenue: demographics + seniors benefits + increasing health care costs. Much more to come, unless you want to re create the working middle class. But you have to pay retail clerks what factory workers made in the seventies adjusted for inflation since it’s all service economy now, until the robots take over and you have a whole new problem. Are you ready?

#81 Howard on 07.18.17 at 7:05 pm

#8 Ole Doberman on 07.18.17 at 5:08 pm
Amazing how fast the GTA is deteriorating yet Calgary with the brunt of the oil fall out still stands with only a few percentage points down – there is no justice.

——————————–

1) Calgary has declined modestly from its heights a few years ago.

2) Calgary real estate was never in a bubble. Overvalued perhaps at the height of oil bull market, but not a bubble. Toronto and Vancouver were/are. Modestly overvalued translates to modest declines.

#82 Fran Deck Jr. on 07.18.17 at 7:05 pm

How ironic that Canada will tell privately owned corporations who they can hire and what they are to be paid. If I want to hire my Dad and pay him $100K to ‘advise me’ … well, that’s my business because it is my business.

But if I have a management position with a Crown Corporation with benefits and a pension, I am encouraged to hire friends or family to spy on employees … just the way they did in East Berlin.

Meanwhile, fake companies continue to launder money in real estate and mortgage fraud in publicly traded companies is ignored.

But Trump is the bad guy because he promotes self reliance and prosperity while continuing to do what’s best for Americans … and whenever I turn on a TV in Canada I see ads for payday loans, quick mortgages and vacations in Cuba.

Anyone who votes liberal is mentally retarded.

#83 cd on 07.18.17 at 7:06 pm

From my experience, it seems that to have the best Canadian life one should strive to be mediocre. Basically be a fourth grade teacher who supports a hockey team that loses half the time, gets drunk every weekend, has poor fashion sense, a bad diet, horrible taste in music, an addiction to comic book movies, an extra car or two, and more than enough housing for two lifetimes…. then you will be at the pinnacle of where the banks and government want you to be.

If you are below the pinnacle (the bad, the poor, the lost, the sick), the government/banks will encourage you to move forward. Either with social programs or debt.

If you are successful, you will get punished for exceeding the status quo and the cost is to help those who are not able to reach the mediocre state. And if you pay the cost then everyone should magically be at the mediocre level and we all win. Mediocrity rules.

#84 Greg on 07.18.17 at 7:07 pm

Re #6: C’mon Garth. Tax rates are high for everyone in Canada compared to the Wild West of the US, that’s part of living in a civilized state with public infrastructure and a safety net.

I didn’t cry for the doctor’s lobby when they fought Universal Healthcare, and I won’t cry for them today when they’re asked to pay a similar tax rate to their patients.

The marginal rate may be high for them, but let’s discuss the average tax rate. I bet they are doing just fine.
——————————–
I agree, they are doing much better than fine….average salary is something like $270K…so why are they whining about losing a tax break when they make more than 90 percent of us? They may not make as much as Garth, but then financial advisors make far more than the value they provide, partly due to the outrageous fees on funds.

#85 Michael King on 07.18.17 at 7:08 pm

In this corner of Kitsilano (west side Vancouver) there are few signs of a crash. More “For Sale” signs perhaps but properties are selling and prices appear to be holding. Looking forward to seeing some actual numbers and I’m sure Garth will publish them when available.
As for T2, I’m not at all sure that he will be PM after the 2019 election. I’ve lost count of all the groups he has disappointed. I didn’t vote for him and I’m not a Conservative so that is an unbiased opinion. The NDP have no chance to form a government, right?

#86 Howard on 07.18.17 at 7:08 pm

#74 Greg on 07.18.17 at 7:02 pm
Glad Morneau had the brains to change the rules to prevent the rich from getting more tax breaks than many of us wage earners. Nice to see that they will have to pay their fare share of tax instead of taking advantage of a loophole to avoid taxes.

————————————

What’s your definition of rich?

I don’t consider a doctor earning $200K per annum to be “rich”. Well off perhaps (and rightly so; do you have any idea what medical school is like, or what it costs?), but not rich.

Go after the hedge fund billionaires by all means. Leave doctors alone and other high-achievers alone.

#87 Ex-Cowtown on 07.18.17 at 7:09 pm

#13 Mike on 07.18.17 at 5:15 pm
.

With all fairness, hats off to Trudeau on bringing this fake professional corporation issue to the front.

I know a doctor who earns $450,000+, but “pay wages” to wife and daughters and in the end pay taxes only on $100,000. everything else expensed, or ‘loaned’ to relatives.

Wife does nothing but cook at home. Kids go to college.

I have NO problem allowing this tax fraud for Doctors/Lawyers. But allow such for middle class wage earners too. Let me pay my stay home wife a salary, and let me deduct it from my salary as expense.

And, we haven’t talked yet about getting money from those fake corporations as dividends and fake loans to relatives and fake lunch/dinner expenses…..

Go Trudeau!! Fairness for middle class, or just allow me(a salaried employees) to give further ‘salaries’ to my spouse/kids and expense my personal lunches, gas, leased cars, dinners, vacations(to attend conferences)…oh no…that won’t be fair, right.

+++++++++++++++++++++++++++++++++++

Spoken like someone who’s never had to worry about making payroll. I’m guessing that all you’ve ever done is cash a paycheque and wonder where your going to spend that fat triple dipped government pension.

Try starting a business.
Bet everything that you have, everyday for 25 years.

Pay for your own courses and development.
Pay for your employees courses and development.
Pay for your own medical and dental using 100% of your own $$.
Pay for your employees medical and dental using your own $$$.
Pay 200% of CPP for 25 years knowing full well that the best you’ll ever be able to claw back is half that.

I’m sure you’d be begging for Trump if you did any of the above.

#88 Prairieboy43 on 07.18.17 at 7:10 pm

Bad move by Federal government. “Fair”, the new federal Canadian motto. “That’s not fair”. Small corporations going to be inspected for everything, with a fine toothed Government app.
A proud “not so fair” Canadian.
PB43

#89 dr. talc on 07.18.17 at 7:13 pm

People – please stop typing that M has made things more fair-the system is not fair, and nothing M does will make it more fair, all he can do is spread unfairness. Obviously misery loves company. They system will never be ‘fair’ because the system is alchemy.

#90 Greg on 07.18.17 at 7:15 pm

Re #73
“Let’s be clear – doctors are not “rich”. These are people earning $200K a year under very stressful conditions, not hedge fund billionaires. And not loafing trust fund sprogs and revellers of mediocrity like the current Prime Minister.”
———————
Sure, they are not “rich”, being in the top 2 percentile, they just earn more than 98 % of us. lol. At least the Prime Minister can figure that out.

#91 Mark on 07.18.17 at 7:19 pm

If those professionals you named have to pay higher taxes, they’ll simply pass that on as higher fees. I don’t see what the big deal is.

yet Calgary with the brunt of the oil fall out still stands with only a few percentage points down – there is no justice.

Calgary is down ~25-30% from the 2011 peak on individual identical properties. With still plenty to go as the EI runs out, and the housing bubble in that city decelerates.

#92 Victor V on 07.18.17 at 7:22 pm

An e-blast from one of Toronto’s more ‘prominent’ mortgage brokers.

==========

Hi xxxxx:

Let me know if I can help with anything, I promise to respond within 1 min to 20 mins of any call or email. With the exception of 4 pm to 5 pm on Monday to Thursday.

My Business hours 9:00 am to 7:15 pm 7 days a week.

3 situations from the last 2 weeks:

-Appraisal came in low – We recently raised a much needed additionall 400,000.00 2 days before closing. Smooth closing. Grateful Realtor and client. 3.1 Million dollar purchase.

-Home Trust pulled out of the deal – We approved and closed the purchase with our own funds in 5 days, charged 1% more than the Home Trust offer. Grateful seller, and purchaser. 2.4 Million Home Purchase Purchase.

-High Mortgage Rate – A client was offered 2.39% from a mortgage broker, and 2.99% from a bank. We closed the refinance with a rate of 2.29% for 5 years fixed. Grateful client. 980,000 Condo refinance.

AAA Bank Rates

Email or call to inquire. We have inside contacts at most of the lenders to get higher loan amounts approved, get around credit issues, and most importantly appraisal related issues.

Emergency Private Mortgage product – 1st and 2nd mortgages
All we need is an appraisal.
No income verification.
Close in 2 days!
Rate: 7.99 to 10.99 – 1st mortgage & 9.99 to 12.99 – 2nd mortgage
Fees: 2% to 5% – 1st mortgages
Fees: case by case basis – 2nd mortgages
Payment: Interest only
Type: Purchases and refinances
Loan Amount: $20,000 to $25,000,000

#93 Mario on 07.18.17 at 7:23 pm

First the liberals taxed the 1%ers, and I said nothing, as I am not a 1%er.
Then the liberals taxed the professionals. And I said nothing, as I am not a professional.
Next the liberals will tax me. And there will be no one left to speak for me.

#94 DD on 07.18.17 at 7:27 pm

Any bets on timing for Trudeau’s latest tax grab?

– Budget 2018 effective immediately?
– Retroactive to Jan 2018?
– Announced before end of this year?
– 2019 tax year (and p*ss off doctor and personal corporation families during an election year?)

#95 Asterix1 on 07.18.17 at 7:27 pm

I wonder how many people fell into this trap?

March 18th = Drive down from Newmarket to attend the Toronto Real Estate Wealth Expo.

March 19th = Tell your wife you are going to be rich!

April 1st = Buy a property at top price, average at 1,065,000$. Find any way to get the 20% down, 213,000$ of hard cash (or extra debt).

April 2nd = Paying 4,000$ mortgage a month + 875$ for property tax/education + 300$ utilities = 5,175$ per month.

April 3rd = Rents the property for 2,300$ per month, losing -2,875$ each month.

Its been a little over 3 months that Tony Robbins and company told him to buy now to become rich!

The result………
* His property lost 284,000$, -26.6%.
* Paid -35,550$ in land transfer taxes.
* Renting property, loss of -8,625$, cant cover costs.

The crazy thing, this is just the start! This crash will be epic!

#96 jess on 07.18.17 at 7:29 pm

fiduciary rule change … how long / who lobbied

https://theintercept.com/2017/07/16/financial-advisers-want-to-rip-off-small-investors-trump-wants-to-help-them-do-it/

http://www.theinvestigativefund.org/investigations/economiccrisis/2356/the_advice_trap/

#97 Bob on 07.18.17 at 7:35 pm

…and the rent seekers shall inherit the earth.

#98 Valleyboy on 07.18.17 at 7:37 pm

Manipulating the tax law to avoid taxes isn’t hard work or success it’s a risk. Or a speculation by manipulating a loophole you will get away with it. So you delusional if you think they deserve a free ride.
Unfortunately I see allot more offshore tax evasion in the near future though.

#99 Rainclouds on 07.18.17 at 7:42 pm

#7 905 $241 MILLION! WOW! Really? NO………

https://www.buzzfeed.com/ishmaeldaro/canada-clinton-foundation?utm_term=.aeQPDX4ve#.hujLEyOnG

In other real news: Apartment 3 floors above me here in Van Groovy. Ask $999,999, 4 yrs ago $650,000 would have got it……….

Stupidity Not extinguished YET in Hubristown

#100 Linda on 07.18.17 at 7:43 pm

#46 MF – right on, brother. Government workers are not parasites – they do work. Are ‘some’ of those workers slackers? Yes indeed, just as there are plenty of slackers in private industry as well.

But ‘they’ get pension plans which ‘we’ pay for. Well, they get a salary & as a condition of employment part of that salary is deducted & put into a DB pension plan. Being part of the pension plan is not an option, so why blame the worker for having a DB plan? Should we blame everyone who pays into CPP for having a DB plan as well? Because CPP IS a DB pension plan….. What I find interesting is that the proposed solution of the ‘have nots’ is to take away what the ‘haves’ have, rather than working to get the same benefit for themselves.

#101 SeeB on 07.18.17 at 7:45 pm

“He or she probably has no benefits, no pension plan, pays lots of overhead and, yeah, makes a few hundred grand a year. That puts him or her in the top tax bracket which, thanks to T2, now Hoovers away more than half of income.”

Please clarify. You’re telling us, that a doctor, (or any individual business owner for that matter), pays PERSONAL taxes on income BEFORE deducting overhead?

#102 Greg on 07.18.17 at 7:46 pm

“What’s your definition of rich?

I don’t consider a doctor earning $200K per annum to be “rich”. Well off perhaps (and rightly so; do you have any idea what medical school is like, or what it costs?), but not rich.

Go after the hedge fund billionaires by all means. Leave doctors alone and other high-achievers alone.”
——————————————-
I consider anyone who’s salary is in the top two percentile to be rich.

Why do you use a different name each time you post? — Garth

#103 John on 07.18.17 at 7:49 pm

“Spoken like someone who’s never had to worry about making payroll. I’m guessing that all you’ve ever done is cash a paycheque and wonder where your going to spend that fat triple dipped government pension.

Try starting a business.
Bet everything that you have, everyday for 25 years.

Pay for your own courses and development.
Pay for your employees courses and development.
Pay for your own medical and dental using 100% of your own $$.
Pay for your employees medical and dental using your own $$$.
Pay 200% of CPP for 25 years knowing full well that the best you’ll ever be able to claw back is half that.

I’m sure you’d be begging for Trump if you did any of the above.”

——————————————
I’m sure you wouldn’t be doing it if it wasn’t so lucrative and I doubt you realize that the majority of employees don’t even have pensions.

#104 Sebastien on 07.18.17 at 7:51 pm

The question now is how many doctors are going to vote with their feet and move to the US.

#105 Oakville sucks on 07.18.17 at 7:51 pm

100 comments already?????

#106 Pretentious Hipster Bicycles on 07.18.17 at 7:56 pm

I earn my salary in dividends as a shareholder/partner in a consulting firm. Income is split 50/50 between me and the missus. We employ 15 people, monthly payroll of $45-50k.
I pay corp tax on the profits at 22-26%. The dividend income split is set up so I dont pay tax twice and intended to offset some of the risk.
If the liberals mess with this, myself and others like me will seriously consider whether its worth it going forward . Well done Bill and T2

#107 Nonplused on 07.18.17 at 7:56 pm

According to economic theory, what these tax changes are going to do is raise the price of whatever goods and services small corporations are selling and reduce supply. We will all pay more for everything.

Need a tow? The tow truck guy is likely an independent operator and he’s just had his take home pay cut so his rates must go up. Need a plumber? His rates are going up too. Garth already covered the doctor. Do you go to a small operation mechanic because you don’t like paying dealer rates? That’s going up too. What about 7-11? That store is probably a franchise and they are going to have to raise prices too.

Folks, any tax applied anywhere in the economy (except maybe on exports but nobody ever taxes those) gets paid by everybody in the economy. That’s just the way it works. It has too. The “invisible hand” makes sure it is so. If a dentist is worth $150,000 per year after tax then that is what he is going to get and he just adds whatever taxes he pays to the bill you pay. That’s just how it works.

That Bill Morneau pretends not to know this means he is either an idiot or disingenuous. Those are the only 2 possibilities. This is just a general tax increase we will all pay dressed up as some kind of social justice campaign. All of the increase in revenue this change will produce will flow through to the prices we pay for things. It has too. The money has to come from somewhere.

#108 Costco Nation on 07.18.17 at 7:56 pm

Appeasing envy is the dearest lesson in the book of the tyrannical society called communism. I lived through it in a quasi permanent suicidal state of mind in Eastern Europe. The vibe I’m getting from this government is so strong that I’m starting my plans to pack out of this shit hole. Not easy. But I’m not going through it again. I wish I had the eloquence to warn more people of how danger creeps until there is no way out. Literally.

#109 Nonplused on 07.18.17 at 8:05 pm

PS the affect of the “invisible hand” on spreading taxes through the economy can be seen by examining any corporations pay ladder.

Ever wonder why a manager might make $150,000/year but his employees make at best $90,000/year? Because the manager pays a higher tax rate. That’s the same reason the VP gets $250,000/year. But all of those extra labor expenses get baked into whatever the corporation is selling so you pay higher prices. We all do. It’s just the way it works. People don’t work for before tax income, they work for after tax income.

#110 Mike on 07.18.17 at 8:07 pm

Stan-

We am sure my wife have MBAs and we ‘earn’ our $250k paycheque and pay taxes. Don’t get to expense personal dinners and leased cars. And don’t get to put our kids on payroll to cheat on taxes as ‘expenses’.

Again, why are you here and bluffing. Just move to US. Get paid twice. Don’t forget my taxes paid for your residency and training. Anyways, go. Find a good visa consultant. Ha….stop bluffing and move.

#111 NoName on 07.18.17 at 8:09 pm

i dont know why you peole worry abut dictores and it guys, soon as can – eu free trade agreement is signed and there is “free” movment of people and good we will get tons of half decent MDs and ITs coming this way from those mickey mouse eu countries.

Soon we wont need univercities, i gues that is positive thing for government payroll will shrink.

you people worry to much

#112 Rexx Rock on 07.18.17 at 8:11 pm

T2 is doing a great job and loved by all.I hope they build a 100 foot bronze statue of T2 after he achieved all is greatnes in Ottawa!

#113 Happy Housing Crash Everyone! on 07.18.17 at 8:14 pm

Is it even a surpirse that prices are crashing hard in the GTA? Honest realtors fighting to let everyone know the truth and lying shysters trying to suckerpeople

#114 genbizx on 07.18.17 at 8:15 pm

Once again embarrassed by my leaders….reduce the size of government and increase the quality? root out waste, corruption, real tax evasion. take stats out of the hands of people unfit to use them….a few steps to help the middle class…

#115 Happy Housing Crash Everyone! on 07.18.17 at 8:16 pm

95 Asterix1
The number of speculators are just mind blowing. Many over prices homes have been sold to these idiots who rent for a loss. Now prices are crashing and they are Toast. This snowball of a crash will be epic. HappyHousing Crash Everyone! :-)

#116 Say Ahhhhh! on 07.18.17 at 8:18 pm

‘You could also (like so many docs) live a frugal life on a modest salary or dividends while keeping savings within the corporation where they can be invested at a lower tax rate than in your own hands. ‘…Garth, never thought you would be a suck up!..Frugal life? Modest salary? Ha…you must have a proctologist
appt coming up!!!

What I said stands. Many pensionless professionals live modestly in order to create their own retirement fund within a corporation. That’s one result of a disciplined mind. — Garth

#117 Lee on 07.18.17 at 8:19 pm

#100 Linda,

You bought the DB plan with your vote. How are people in the private sector supposed to do that? And by the way, you forgot to mention that the government matches or close to matches your contribution to the DB plan. This contribution by the way does not show up on the sunshine list. Neither will lower end government workers be scrutinized for the large pay increase they are about to get where their incomes are tied to the minimum wage. Please don’t try to pull the wool over people’s eyes. We all have access to the Internet. There is no shortage of websites spelling out in detail the pay structure of every single government worker right down to the $30 an hour cafeteria worker at City Hall in Toronto.

#118 M-cube on 07.18.17 at 8:20 pm

The human game is full of risk…some are social risks…some are physical risks…some are economic risks. So the fact that the taxation for incorporated individuals will change is part of the game of life…so who cares! Deal with it! No one is a victim, but everyone is a predator. Risk on baby!

#119 TurnerNation on 07.18.17 at 8:22 pm

The days before Smart phones, before digital cameras. Developing film cost money.
Why would you take a photo of yourself? It would be considered as a mistake.

No – film and camera was for capturing difference, your imagination would draw the scene and a lens to cement it.

Today our elite rules are roaring with laughter – they have us shut down and hooked on online TV, video games, pr0n, social mediums.
Paid the most are The Distractors: Actors, Pro athletes in sports; speakers like Baloney Robbins, TV Evangalists.

A maximum wage of $15 net of taxes, carbon taxes and money stolen to overseas and never again seen.
500 sq feet UN approved living box and a 2nd world lifestyle. Our elites and their corporations? More money than God. We cannot imagine.

M41ON

#120 dave in kincardine on 07.18.17 at 8:23 pm

Let me see – a means test for small Corps to make sure people are not abusing the situation. Sounds like a responsible government to me. Canada- greatest country in the world, and quite comparing us to the US. Sadly, they are losers except for the 1% of the 1%.

#121 M-cube on 07.18.17 at 8:28 pm

Btw, if the government really wants to get fair on taxation, it needs to stop turning a blind eye to the 100s of Billions of CDN dollars sitting illegally in tax free jurisdictions. The IMF estimates that 1/3 of the world’s wealth is hidden in these places….and this is an estimate from the IMF, which means the amount of money hidden is significantly higher. But it’s much easier going after decent folk for tax dollars and so the government bureaucrats opt for the weaker prey.

How is it ‘illegal’ to keep after-tax dollars outside Canada? — Garth

#122 Mike on 07.18.17 at 8:33 pm

“It’s easy to predict what will happen now. Very easy. Doctors will say ok, fine under the new tax rules I’ll cap my income at $250,000 per year and work half time. Instant bull run on personal freedom and less incentive to work hard now. Or, could they start to jack up fees for simple things like sick notes to $100 etc. Gotta pay the bills somehow! At any rate.. no point in working any harder if it just goes to Bill Morneau. Welcome to the new semi-retirement top wage earners!”

Thank you. This is EXACTLY what will be happen, to some extent or another. T2 just hoovered our healthcare system (even more)

#123 Dentabroad on 07.18.17 at 8:33 pm

I’m a dentist who left Canada a few years ago. I had a professional corporation. I made approximately 175-200 k per year, paid myself a salary of 90k, paid my wife 30k and used the rest to pay off my student loan which amounted to $350,000 after 8 years of study. I worked hard – 40 hours per week with plenty of stress, sore backs, after hours calls, etc. I am considering coming back to Canada to practice, but this policy change will influence my decision. Buying a dental practice involves big dollars, risk, staffing headaches, and very high overhead (60-80%+). I have worked in many countries and have been teaching at University dental schools overseas. Canada has probably the best trained dentists in the world. We do not want to lose our graduates! My two cents

#124 Doug t on 07.18.17 at 8:34 pm

And we will all just sit by and let this happen without any protests because after all we are “nice” Canadians – losers

RATM

#125 bob on 07.18.17 at 8:37 pm

@110 Mike
The government doesn’t pay for residency and training, not exactly anyways. Residents are paid something like $35K/year to work 80 hours/week… (less than minimum wage). And the doctors who train them, get stipends that are probably half or less than what they would make doing other paid work.

In other words, residents do a lion share of the work in the hospital that would cost full-time staff e.g. $250K to do. So, residents save tax payers money.

And if you didn’t train, you’d have to recruit from other places that do train.

#126 Chaddywack on 07.18.17 at 8:38 pm

My wife is a doctor who is not incorporated and we’ve been warning new grad friends to not incorporate since reading warnings of this for months (some did and some didn’t). A lot of them decided to just do it because that’s what the tax accountants and lawyers who come to their med school and residency seminars tell them. I don’t think that they understood with tax integration you essentially pay the same amount of tax as a sole prof anyway IF you were to run all your income through it every year (the real benefit was the deferral of income and splitting with family)

We’ve always seen it as a personal choice depending on the situation, but in our circumstances incorporating (and the additional fees and complexity) did not make sense.

I do feel bad for those that have and will now be stuck with a complex structure that is expensive to unwind and really does not yield any more benefits than a sole prop thanks to T2 anymore.

We just run a sole prop and max out RRSPs every year. Granted, not as good as a corp for deferrals or dividends but it works in our world and lets T2 fund all of his pet projects!

#127 Muttley O'Toole on 07.18.17 at 8:42 pm

My old man gave me two pieces of advise when I left home and in Trudeau’s case it seems appropriate:
1) Beware the man wearing brown to town.
2) Never look anyone in the eye whilst eating a banana.

#128 Happy Housing Crash Everyone! on 07.18.17 at 8:44 pm

Smokingman give it up. You mindless RE pumping is a joke. Tell your realtor wife to do her own cheerleading. Prices are falling harder then the 1990 crash. For sale signs everywhere , littered across the GTA with the odd sold sign from 3 months ago. All those buyers lost hundreds of thousands of dollars. Realtors themselves have walked from deals. why would They do that after signing a contract to buy? Happy Housing Crash Everyone! :-)

#129 Shortymac on 07.18.17 at 8:48 pm

I think I might vulch at this point… if we have already hit 18% who knows what is going to happen?

#130 conan on 07.18.17 at 8:48 pm

#96 jess on 07.18.17 at 7:29 pmfiduciary rule change … how long / who lobbied

Fiduciary rule means a financial industry collectively putting up a shingle that says “out of business.” As go balanced, and do it your self, is the only advice that fits its narrow legal definition.

There will be no invention,or creative spark, just a one dimensional financial market that will eventually stagnate the entire economy.

You would be eliminating thousands of jobs in order to create a society that is shooting itself in the foot. I can see why the financial industry is fighting this.

You can apply Fiduciary rule to any profession, or industry, and destroy it. Even yours, what do you do?

#131 Chris Scott on 07.18.17 at 8:49 pm

@ #13 mike. You’re free to quit your job, start a company and pay your stay-at-home wife a salary too.

What’s stopping you?

#132 For those about to flop... on 07.18.17 at 8:49 pm

#85 Michael King on 07.18.17 at 7:08 pm
In this corner of Kitsilano (west side Vancouver) there are few signs of a crash. More “For Sale” signs perhaps but properties are selling and prices appear to be holding. Looking forward to seeing some actual numbers and I’m sure Garth will publish them when available.

/////////////////////////////

Mister King,a little present for you…

M43BC

https://www.zolo.ca/vancouver-real-estate/kitsilano/trends

#133 Bob on 07.18.17 at 8:51 pm

I wonder if Omar Kadr will be setting up a PREC going forward to protect his windfall.

Great job, Canada.

#134 NoName on 07.18.17 at 8:58 pm

#119 TurnerNation on 07.18.17 at 8:22 pm

Famouse old selfies

selfies from space (buzz aldrin)
http://media2.whosaystatic.com/611365/611365_770.jpg
selfies form indias george harrison
http://art-sheep.com/wp-content/uploads/2015/11/GeorgeHarrisonsfisheyeself-portraitsinIndia19661.png
Selfies from Jackie Kenedy
https://www.brandingmag.com/wp-content/uploads/2013/11/cape-times-campaign-image-4.jpg
old people selfie
http://i.dailymail.co.uk/i/pix/2014/02/08/article-2554816-1B4CAC2100000578-674_634x501.jpg

selfie
https://youtu.be/kdemFfbS5H0

#135 BC_Doc on 07.18.17 at 8:58 pm

#104 Sebastien on 07.18.17 at 7:51 pm
The question now is how many doctors are going to vote with their feet and move to the US.
*********************************************

Here in BC, the physician work-force is greying– lots of docs in the 50+ club. Our provincial government can’t mint enough replacements through our provincial medical schools nor can it import enough South African or British trained docs. The biggest risk here isn’t MDs heading south IMO, it’s docs working less, semi-retiring or retiring early. As a North of 50 guy myself who gets tired of getting hassled by doorknob hospital administrators, College regulators, provincial politicians, and now told to “pay my fair share” by a trust fund baby , each of the three options I mentioned become more and more attractive. Financially, due to hard work and aggressive saving and investing, I’ve hit the point financially where I could retire comfortably if I had too. Trudeau should proceed cautiously before he goes after the incorporated professionals– the unintended consequences can be a b1tch.

#136 im not buyin' what dey sellin' on 07.18.17 at 8:59 pm

#129 Bob on 07.18.17 at 8:51 pm
I wonder if Omar Kadr will be setting up a PREC going forward to protect his windfall.

Great job, Canada.

how about this
‘the msm lies about everything, but they’re telling the truth about Omar Kadr’

try this
everything you’re read about is a lie

the Omar Kadr operation has many purposes
you will never know the truth
one thing i can assure you, there is no 10 million

#137 Vankongshow on 07.18.17 at 9:06 pm

I question why the gov’t would attck independent contributers to the economy. So what if people that work in Canada are incorporated. They still pay taxes on both personal and Corp-they have to pay for all their own expenses and supplies (not like those working for bigger corps) everyone has a choice. Sadly I believe this is maybe being done simply because Canada is an international cesspool for tax evasion (ref:Panama Papers) so the the dirtbags ruin it for hard working contributing legal contributors. It breaks my heart knowing that my great grandpa died fighting for this country and our freedoms. Now too many Canadians bend over and Allow ourselves to get steamrolled by exploiters of once the greatest system in the world. The country was at one point built by people of honour-we have allowed too many to join the party of Canada and take advantage and exploit the piss out of our once great system with valued perks. The biggest being a great medical system. Without a system like this in place many Canadians would be officially bankrupt or dead cause no way could they independently afford the services.
Maybe the problem isn’t so much about dr’s and lawyers as it is about many newer citizens exploiting local citizens few tax loopholes–(oh yeah and real estate and tax free capital gains being one of them). F($(@:k I wish people will start getting mad about the things that matter instead of pissing and moaning about a gov’t worker having a mill in the bank. Maybe he bought FAANG stocks 15 years ago. Bet yah most anyone would be a millionaire had they started back then

#138 WUL on 07.18.17 at 9:07 pm

I’ve been waiting to witness an exodus of doctors since 1962 and Tommy Douglas. Could someone start recording the border crossings of the sawbones. They have a real good gig here.

And, thank you to Trump supporters. You are hilarious as is his Presidency. I salute you for going down swinging.

#139 TurnerNation on 07.18.17 at 9:13 pm

ROTFL saw this. All Real Estate speakers. Every one.

Give us Bikes(cars), Babes and Balanced Portfolios!!

https://www.eventbrite.ca/e/build-her-wealths-summer-networking-event-tickets-36077077510

“Today, more and more women are taking control of their financial futures. Let our panel of educated and successful guest speakers answer the questions you need to begin or continue your journey towards growing your passive income!”

#140 me again on 07.18.17 at 9:13 pm

just what we need, medical doctors reading the cra site, scratching their heads, instead of reading our medical histories, lab results, professional journals etc.
thanks, t2 thanks M

#141 FreeBird on 07.18.17 at 9:13 pm

So hubby/ business partner and just got screwed by the guy we helped elect and many of our friends and colleagues who fall into the fields named. Hopefully we’ll sell, invest well and get out. I’ve already felt and feeling the effect of wait times and bottle necking in a healthcare system that is over pressured and getting worse. Already more good doctors are going south on graduation or the ones here are taking more vacation time/ shorter work weeks prob to supplement with private services where/ when they can.

Like the rest caught in this unfair net we’ll do our best to follow the advice on this blog, and hope we save (protect) enough from CRA to have some peace of mind.

Scared? Yes. When’s the next election?

#142 Ace Goodheart on 07.18.17 at 9:14 pm

One form of income that is taxed at a very low level and that they’ll never touch is dividends and capital gains. Reason? That is how the govt (children of the wealthy) earn their incomes. It makes no sense to tax someone up to 75% less because they don’t actually do anything productive for their money. Really you are giving a massive tax break to wealthy parasites.

But remember who runs the government. The ultra wealthy and their kids.

Best way to earn income is dividends and capital gains, hands down.

#143 Bonhomme Carnaval on 07.18.17 at 9:17 pm

@ #49 JSS on 07.18.17 at 6:23 pm

Wow! Not only does your comment ooze of ignorance, but it’s also racist and condescending.

Well done sir,

@ #72 Smoking Man on 07.18.17 at 7:00 pm

Let’s hope you’re right SM! I’ll drink to that!

@ #77 Wait There on 07.18.17 at 7:03 pm

Truer words were never spoken.

#144 Geoff on 07.18.17 at 9:19 pm

Garth, how soon could Bill’s “fairness” be implemented? Is our 2017 tax year safe from this?

Looks like it. — Garth

#145 Libs - BIG FAIL on 07.18.17 at 9:21 pm

Sock boy T2, BM, the M103 clique and all the rest is these misfits are ruining the country- doesn’t anyone see it?
God forbid they win a second mandate in 2019-

#146 Tony on 07.18.17 at 9:22 pm

Re: #54 Tony the Gino on 07.18.17 at 6:29 pm

I just checked and saw a few price reductions in Woodbridge.

#147 Mario on 07.18.17 at 9:31 pm

I know a dentist that deals in mostly cash. How much tax will he pay?

Not credible. — Garth

#148 Cheddar on 07.18.17 at 9:36 pm

Perhaps a little cheese to go with all of this whine…..

#149 A Reply to #107/#109 Nonplused on 07.18.17 at 9:43 pm

“According to economic theory, … these tax changes [will] raise the price of whatever goods and services small [business] corporations are selling and reduce supply. We will all pay more for everything.”

Which economic theory? An oligopoly pricing model? Nash equilibrium? Duopoly? Monopoly? Perfect competition? Something else?

“When demand is perfectly elastic, by definition consumers have an infinite ability to switch to alternatives if the price increases, so they would stop buying the good or service in question completely—quantity demanded would fall to zero. As a result, firms cannot pass on any part of [a] tax by raising prices, so they would be forced to pay all of it themselves.”
https://en.m.wikipedia.org/wiki/Price_elasticity_of_demand#Effect_on_tax_incidence

“… the [e]ffect of the “invisible hand” on spreading taxes through the economy can be seen by examining any corporations pay ladder.”

The invisible hand has nothing to do with taxes or their distribution in the economy.
https://en.m.wikipedia.org/wiki/Invisible_hand

#150 nick on 07.18.17 at 9:44 pm

Im glad they are doing this, the loopholes need to be closed.

That being said, in general, we should be giving doctors more incentives to stay/work/startup here…

#151 Joseph R. on 07.18.17 at 9:45 pm

“Follow the law and split income with your spouse who, as a shareholder in your medical professional corporation.”

Then why a lot of financial adviso(e)rs are recommending their clients to convert their corporations into a SIFT (Specified Investment Flow-Through) Trust?

“The taxable SIFT trust distributions are subject to tax based on net corporate income tax rates.”

https://www.canada.ca/en/revenue-agency/services/tax/trust-administrators/specified-investment-flow-through-sift-trust-income-distribution-tax/what-a-sift-trust.html

What are the tax advantages, if any, do trusts have over a corporation? Didn’t F eliminate them back in 2011?

#152 The Lewler on 07.18.17 at 9:53 pm

Socialized medicine is the worst.

Remember everyone , whomever controls the dollars makes the decisions on care.

#153 Long Branch Apprentice on 07.18.17 at 9:55 pm

The jealousy and envy of your average Canadian is becoming more and more evident as the cracks on RE widen.

Housing has become the national obsession because the majority of Canadians have no aspirations or dreams larger than becoming a mortgage slave.

Going to a bank and borrowing a lifetime’s worth of wages takes no particular skill, no real talent yet it is the biggest dream of many.

Between Instagram lifestyle bloggers and Milennials trying to use their houses as a status symbol, I’m starting to wonder what truly motivates people.

For some, its the subtle oneupsmanship, but for most, like Smoking Man says, it’s the pat on the head.

#154 Contrarian Coyote on 07.18.17 at 10:00 pm

#59 Willy H on 07.18.17 at 6:41 pm
#14 Kayaker on 07.18.17 at 5:18 pm

Your post explains why I see so many luxury vehicles around me on the 401 everyday. (Mercedes, Audi, BMW, Acura, Lexus etc.). Vehicles normally the preserve of the 2%’s driven by over-tattoed middle class Joe’s (and Joettes) who cannot afford RESP contributions for their children (let alone retirement savings). They breed like rats in a low interest rate nest and feast on GTA Mandarin buffets and Krispy Kreme donuts. They cut you off, park where they please (especially the sidewalk in front of your local Walmart entrance) and pass you on the highway with a certain air of self-importance while staring vacuously at their smartphones cruising at 130km. They spend half their lives in Tim’s drive-thru’s (their bloated children sipping on ice caps and hovering up 12 packs of McNuggets in the back seat) and the other half blaming government for all their problems!

Yes, I also agree that getting out (safely) on Canada’s beautiful waterways in a canoe or kayak is the next best thing to owning a dog!

===

This sadly describes much of the Kawarthas from Peterborough up to Apsley and beyond on weekends from Spring thru til early Winter. Highway 7 East is a nightmare of dangerous driving and bad attitudes. Gotta race at 150km/hr to get to the cottage early Saturday only to spend the night and race home Sunday afternoon/evening and back to the grind in the GTA. I haven’t seen this many entry-level German imports since living in the wealthy areas of Seoul.

My boomer father keeps asking me how the heck people afford these cars. We both guess it’s mostly leasing and long-a$$ financing.

Can’t wait for cottage season to end here in the Kawarthas. Wife and I are soon to be relocating further east towards Carleton Place/Ottawa.

#155 Timothy O'Connor on 07.18.17 at 10:01 pm

If you read fine print, after consultation period, it becomes effective today or any date thereafter. This is in reference to capital gains portion of legislation.

#156 Viorelli on 07.18.17 at 10:06 pm

My parents run away from USSR when I was a child, my dad always hated the communists and wanted to have his own business without the state telling him what to do and what to act like. Now the communists are here, taking once again something that is not theirs, unfortunately these sick commies don’t understand that the creative, productive, and business owners who provide jobs for others will once again leave, the capital in form of taxes which the commies seek will leave the country as well thus eventually turning it into a third world shi…hole. I just got back from Moscow and Ekaterinburg where I was visiting some family members, business is booming, 10% flat tax on everyone, no matter how much one makes. Seems fare, Chinese got the same idea. This is where the future is, my kids may have to one day move back to the country where their grandparents run away from. Round and round it goes, where does it stop nobody knows.

#157 crossbordershopper on 07.18.17 at 10:15 pm

well, well finally the crossborder has it right. jump on the bus, since were all going to Miami, better weather, us $, and i have no worries about gst lady calling or passive corporate tax mumbo jumbo, because its all cash for me.
so T2, you do whatever you want to do, i like thousands of entrepreneurs will play the game, just not here, we will roll into town with 9 grand in cash, live in our paid off home up here, have free health care and really do business elsewhere. poverty in canada, but living the life elsewhere.
what a joke these guys are doing, just pack your bags, you will eventually come to my way of thinking and living. whats t2 going to do, dont make any money in canada, not taxable, hell the house isnt even in my name, i dont ‘own’ anything.
there are a lot of doctors from overseas and they will get accredited in canada to fill voids, the lineups and generic drugs is what the patient gets, everything is watered down here, everything, . you want a 4 dollar pizza, well thats what you get in canada.
Garth rambles on about debt, house prices etc, all well and good, nice house in south florida is only a couple hundred grand, we are all going to get old, might as well get ready and settle in now down there save yourself the time and trouble when the real move happens. everyone knows no immigrant who comes here now picks canada first, its the backstop for america.
get a simple tn visa, and start working,
cash is king, us $ preferred.

#158 joblo on 07.18.17 at 10:17 pm

So maybe Crossbordershopper had it right all along,
It’s good to be poor in Kanada.

#159 Ex-Cowtown on 07.18.17 at 10:18 pm

#103 John on 07.18.17 at 7:49 pm

I’m sure you wouldn’t be doing it if it wasn’t so lucrative and I doubt you realize that the majority of employees don’t even have pensions.

+++++++++++++++++++++++++++++++++++

Lucrative? Hardly. I’ve been independent my entire working life. Feast and famine. Some times years pass while I make nothing, and live like a pauper from the fat of previous years and build a business. If I’m fortunate I’m able to cash out and even things up. And sometimes I don’t and I man up and take a big loss. My choice though.

The common theme is that we’ve always lived well beneath our means. For the other side, I just look at my cousin and his wife. Both work for the government, pissed away every penny that they’ve ever made and I get the honour of paying both of their gold plated pensions. How’s that for fair?

My only hope is that T2 and his bench of morons don’t raid my rainy day fund and give it to my cousin and his wife when the public pension well goes dry.

#160 Vanrentor on 07.18.17 at 10:22 pm

An entertaining RFD thread about a guy who got bought at the GTA peak and cant get out.

http://forums.redflagdeals.com/sticky-situation-how-move-forward-2113394/

His house horniness has ruined his finances for the next decade.

#161 Expat canuck on 07.18.17 at 10:22 pm

Hiya Garth,
Sorry dude but those of us unlucky enough to have the lofty income which you enjoy are struggling to make ends meet. For you to say you wish you had Trump running Canada – as a long term Canuck residing in les etats units and with all due respect – you are out of your everlovin’ mind. We are making plans to move back home to Canada as I write this. Hmm, maybe want to trade houses Garth? Then you can have Trump all for yourself and all the lower taxes the wealthy in the states feel entitled to. Be grateful for what you have, buddy. I don’t think you know just how good you have it in Canada, eh?

#162 bdwy sktrn on 07.18.17 at 10:32 pm

“The biggest risk here isn’t MDs heading south IMO, it’s docs working less, semi-retiring or retiring early. ”
———————–
my doc just told me he’s done with a white rock to d/t commute and is doing all 3 above.

#163 Grade 7 math on 07.18.17 at 10:32 pm

#123 Dentabroad on 07.18.17 at 8:33 pm
I’m a dentist who left Canada a few years ago. I had a professional corporation. I made approximately 175-200 k per year, paid myself a salary of 90k, paid my wife 30k and used the rest to pay off my student loan which amounted to $350,000 after 8 years of study. I worked hard – 40 hours per week with plenty of stress, sore backs, after hours calls, etc. I am considering coming back to Canada to practice, but this policy change will influence my decision. Buying a dental practice involves big dollars, risk, staffing headaches, and very high overhead (60-80%+). I have worked in many countries and have been teaching at University dental schools overseas. Canada has probably the best trained dentists in the world. We do not want to lose our graduates! My two cents

—–
My 3 cents say we should be immigrating Dentists and education (private schools) as many kids who want to be Dentists as we can.

And then lifting barriers to them practicing. Only reason salaries are so high is the profession restricts entry. Hopefully will come to an end with globalization.

#164 Grade 7 math on 07.18.17 at 10:34 pm

And those Doctors who say they will go to the USA…Go…hahaha

you have to work for someone else. You can’t set up your own business there. hahaha

Go…

#165 GEEBEE on 07.18.17 at 10:34 pm

Hi Garth,

Been following your blog for many, many years.

A great service and a great example of how the web can give anyone timely info. This is missed by many.

I think back to the first postings of years ago. Colleages of mine thought I was an idiot for suggesting otherwise, that the market could go south.

Of course, house prices in Canada will always go up!

A banking actuary and his daughter told me this in 2001. I was confused and sceptical. Maybe they were right?

Some post gloating info about their own situation and others are worried about the possiblity that things will change.

Does anyone really beleive that you can just sit in your house and become a millionaire?

You have to work to make money.

It does not get any simpler than that and as a business owner it does not get any more real than this.

Your employees deserve a wage to be able to participate in the economy, buy a house and have little ones. It is not a casino.

If you forget this fact your are doomed.

How do you think that society turns over? You think that one generation can extract all the wealth from the next to create an easy retirement?

It does not work that way.

It does not matter if there is money pouring in from outside or local people gambling that they will win. The results are the same.

If you want to live in Canada you are already sacrificing a lot to be here. Just have a look around. Do you forget what happens here 6 months of the year?

You really think that a semi in mid-town Toronto is worth 1 million?

You can find a place in the Hamptons for way less. Or in Mexico.

You think rents of 3K + are normal for a house? Give your head a shake.

Even 300K of immigration will not mantain this momentum. And what a way to justify your society, that desperate people from elsehwere will finance your exit. Pathetic.

The misallocation of wealth in this economy is epic. You need to invest in Canadian companies that employ people or it all stops.

We can make anything in Canada. There is no other way to say this. ANYTHING.

Wake up.

G.

#166 MF on 07.18.17 at 10:41 pm

Lol at all the moaning on here as if this is the end of the world.

I remember when Trump won the election. Every message board was filled with Americans wanting to come to Canada.

The same moaning and complaining.

#157 crossbordershopper on 07.18.17 at 10:15 pm

” everyone knows no immigrant who comes here now picks canada first, its the backstop for america.
get a simple tn visa, and start working”.

-Sorry but this is nothing but BS. Do you actually talk to any immigrants in real life? Personally, I live with one of those immigrants that is working her ass off for the privilege of Canadian citizenship. Canada was her first choice. The process is rigorous and frustrating, and she has risked everything for it. All her friends are the same.

MF

#167 Grade 7 math on 07.18.17 at 10:45 pm

#19 Stan Broock on 07.18.17 at 5:24 pm
#13 Mike on 07.18.17 at 5:15 pm

You are STUPID.

Your doctors is disclosing his/her/zer financial affairs with you? Sure.

Just keep in mind that the doctor – he/she/zer is making twice less in nominal income than his/her/zer’s/ US counterpart.
Maybe 3 times less in real terms.

So when you get cancer or diabetes please go somewhere else to get treatment as I believe every Canadian doctor should simply reject servicing such idiots including the stupid bill and j2

——

Sure. Go to the USA. As a Dr, you have to work for someone else (salary). Cant open a standalone business.

#168 Bottoms_Up on 07.18.17 at 10:47 pm

#10 Randy on 07.18.17 at 5:11 pm
————————
CPP is a pension plan for all working Canadians, and is well-funded. Nice try though.

#169 Zaijian BC's Development Industry on 07.18.17 at 10:47 pm

Well, its official today – BC has a new NDP minister of housing. British Columbians are completely unaware of the NDP official platform policies, but are they in for a shock:

– speculator taxes of 2% on empty homes (until you provide proof of filing taxes in BC)
– new 114k supply of housing (owner, rental, supportive)
– task force against real estate fraud and tax evasion
– renter’s rebate
– getting rid of the loopholes in fixed term leases and renovictions

And the ones that did not make it into the platform but are well discussed by the NDP advocates:
– closing the pre-sale loophole in the BC Foreign Buyers Tax, if not extending it to 30% (that was the Green position)
– the BC Home Buyers Program that granted up to a 37.5k down payment for places up to 750k, and which is fuelling the price increases in that part of the market, will be eliminated
– eliminating ‘beneficial ownership’ and the ability to hide behind numbered companies

The NDP got elected in the Lower Mainland where housing affordability was the number one issue. While the development industry pretty much ran the show the last 16 years, that is all about to change.

The goal is to make housing go back to being something that you live in – not a store of wealth or a misallocation of productive capital.

#170 MF on 07.18.17 at 10:48 pm

#154 Contrarian Coyote on 07.18.17 at 10:00 pm

I too have wondered how these people afford these luxury vehicles I see everywhere here north of the GTA. Some have super high end Porsche and Mercedes vehicles. I’m talking 300k cars. They drivers look like they are 25 too. Must be a really long lease?

#100 Linda on 07.18.17 at 7:43 pm

Yup. A lot of these people blaming “government workers” must be stuck in the 1990’s and delusional. Maybe back then permanent employment was the norm? Well those days are long gone and, like the private sector, almost all government positions are contract garbage now. The “pension” is mediocre at best, and my close family member (who is facing layoff like a ton of other young workers), won’t see a penny of it.

MF

#171 Leo Trollstoy on 07.18.17 at 10:54 pm

Good comments by the former Canadian dentist and the person who suggested that some physicians will simply self-cap earnings at $250k and work half time.

Otherwise today is full of jelly poor ppl

IT ppl incorporating cuz they b getting PAID!

#172 MF on 07.18.17 at 10:58 pm

#141 FreeBird on 07.18.17 at 9:13 pm

“So hubby/ business partner and just got screwed by the guy we helped elect and many of our friends and colleagues who fall into the fields named.”

-Ouch. Well at least you admit the mistake.

” Already more good doctors are going south on graduation or the ones here are taking more vacation time/ shorter work weeks prob to supplement with private services where/ when they can.”

-Hear this all the time, but rarely actually see anyone make the move. All my friends who graduated from Canadian universities are practicing in Canada (i’m 34).

The American system is different. There, doctors have to actually market themselves for patients. It helps if you are charismatic and good looking like one of the doctors on Grey’s anatomy. Here that is not the case. Not everyone has the ability to market themselves like that (or wants to).

MF

#173 Andrew t on 07.18.17 at 11:05 pm

#33 TortyPapa on 07.18.17 at 5:50 pm
Well…. at least they aren’t going to get rid of the Professional Corps altogether. That would have been awful.

I am a professional and is incorporated. I make a good income so I don’t mind paying the tax but give me a break on the “We are taxing the rich” bullsh*t.”

People who work harder and are taxed more gets nothing else more than any other lazy person in Canada. Give me a high tax bracket lane on the highway? Or maybe a priority lane at the emergency when something happens?

Hold up there, pardner.
There are plenty of hard working folks who aren’t well compensated. Calling people with lower incomes lazy is, well, lazy. How about a little humility and a little decency?
So much bitterness and bile this evening.

#174 Ron on 07.18.17 at 11:06 pm

#153 Long Branch Apprentice on 07.18.17 at 9:55 pm

The jealousy and envy of your average Canadian is becoming more and more evident as the cracks on RE widen.

Between Instagram lifestyle bloggers and Milennials trying to use their houses as a status symbol, I’m starting to wonder what truly motivates people.

—————————–

simple. it’s a profound insecurity prevalent in much of canada, though highly concentrated in the gta. It manifests in two major forms (1) the middle class obsession with luxury, status symbols/signals like cars, clothes, real estate and other conspicuous consumption (2) the cold, closed, passive(-aggressive) avoidant manner commonly observed when interfacing with non-acquaintances. the message is ‘look at me, envy me, and then f-off.’

observing manners like this in canada was kind of a surprise to this american ex-pat, who always thought of canadians as friendly, humble, down-to-earth and fiscally prudent. in the states, talking and showing off about money and real estate is kind of gauche (unless you’re a kardashian of course, or other old-world new-money type), in a country where billionaires wear hoodies and still live in their first home.

tl;dr canadians are insecure, which is why they make bad decisions about money

#175 bdwy sktrn on 07.18.17 at 11:08 pm

#183 Entrepreneur on 07.18.17 at 4:10 pm
Wonder if the jets make the earth dryer (one of many reasons)? Could their massive size be like a big blow dryer?
————
jet exhaust is water.

#176 Boombust on 07.18.17 at 11:12 pm

#162 MF

And rightly so. Canada is a fantastic country.

#157 crossborder shopper is one of those Canadians who look to the US for everything. He has likely NEVER been anywhere in Canada except for the occasional local camping trip.

A real idiot. And, unfortunately, there are a lot of other ignoramus Canadians out there who are just like him.

If the US “is where it’s at”, he should pack up and move there.

#177 JT Why on 07.18.17 at 11:15 pm

T2 himself was a BIG SUPPORTER for small business tax avoidance strategy when he was campaigning back in 2015 all over the country:

Liberal leader Justin Trudeau could draw on personal experience when he claimed that a “large percentage” of small businesses are used by wealthy people to shield income from taxation.

Trudeau was asked about his plans for changes to taxation on small businesses during an interview with CBC, broadcast Tuesday night.

“A large percentage of small businesses are actually just ways for wealthier Canadians to save on their taxes,” he said. “We want to reward the people who are actually creating jobs, and contributing in concrete ways. So there’s a little tweaking to do around that.”

What the hack?

http://nationalpost.com/news/politics/trudeau-is-one-of-the-wealthy-canadians-he-says-benefit-from-small-business-tax-deductions/wcm/212a3dd8-65c1-46ef-a29e-69cdf4c75ebb

#178 JT Why on 07.18.17 at 11:16 pm

http://nationalpost.com/news/politics/trudeau-is-one-of-the-wealthy-canadians-he-says-benefit-from-small-business-tax-deductions/wcm/212a3dd8-65c1-46ef-a29e-69cdf4c75ebb

“Trudeau himself was involved in at least three small business that were federally incorporated, one of which he used to receive income for paid speaking events he did between 2006 and 2011. He was the owner and sole director of JPJT Canada Inc., the corporate face of a speaking business that earned him about $1.3 million over a six-year period.

The speaking fees became an issue of controversy in 2013 when the Citizen reported that he charged as much as $20,000 per speaking event, even after he was elected as an MP for the first time in 2008. He discontinued the speaking business when he decided to run for his party’s leadership.

At the time, Trudeau was also listed as a director of two other corporations:

– 90562 Canada Inc., the federal corporation that held a portfolio of securities that were part of Trudeau’s inheritance from his father, Pierre Trudeau, that he shared with his brother, Alexandre. The securities were managed by Montreal investment firm Jarislowsky Fraser. The corporation was dissolved in December 2013.

– 7664699 Canada Inc., Trudeau’s personal holding company, which was used when the inheritance was split up. In 2013, the company listed $958,000 in short-term investments and $255,000 in cash.
Because he had incorporated, Trudeau could have lowered his personal tax burden by having any speaking-related expenses paid through JPJT Canada Inc.”

#179 Sebee on 07.18.17 at 11:25 pm

Last I checked prices were out of whack in Sept 2016 and we were in massive debt and it took most of one income to buy a home and…

So 18% back to Sept 2016 is not nearly enough.

#180 Smoking Man on 07.18.17 at 11:29 pm

Communism had arrived in Canada. No not really, its been here but hidden. The state telling a business who it can hire. Mind blowing.

Its out of the closet now. Who the hell in their rigjt mind will ever invest a dime here again.

That goof morrow or what ever will attack 50k risk takers and creative people. To pull in about the same amount of money he gave to the Clinton foundation.

I’ve been warming you for the last few years.

I dont just talk the talk, I walk.

Part of me wants to stick around to fight these mental retards. But I dont think I can win this one. Teachers got em young and for to long.

Delema, going to be a grand dad soon. Do I let the state educate them?

I dont know what to do.

#181 PM on 07.18.17 at 11:39 pm

The average GTA property was worth $919,589 in April – the most ever. But by July 13th that had declined to $755,727, for a rout of almost 18%.

__________________________________________

As Ron Burgundy would say; “that escalated quickly”

#182 Just the Facts on 07.18.17 at 11:40 pm

#95 Asterix1

I wonder how many people fell into this trap?

March 18th = Drive down from Newmarket to attend the Toronto Real Estate Wealth Expo.

March 19th = Tell your wife you are going to be rich!

April 1st = Buy a property at top price, average at 1,065,000$. Find any way to get the 20% down, 213,000$ of hard cash (or extra debt).

April 2nd = Paying 4,000$ mortgage a month + 875$ for property tax/education + 300$ utilities = 5,175$ per month.

April 3rd = Rents the property for 2,300$ per month, losing -2,875$ each month.

Its been a little over 3 months that Tony Robbins and company told him to buy now to become rich!

The result………
* His property lost 284,000$, -26.6%.
* Paid -35,550$ in land transfer taxes.
* Renting property, loss of -8,625$, cant cover costs.

The crazy thing, this is just the start! This crash will be epic!

////////////////////////////////////

Your results are off a little bit :)
– Approx correct on the property loss, $284,000, -26.6%.
– He has not paid $35,550 in land transfer taxes, only about $17,XXX (NOT doubled). He did not buy inside the City of Toronto, remember? Lucky him!
– Renting loss of about -$2,875 every month, but so far for approx one month only. Remember the normal 60-day closing?

The show has just started. Bring out the pop corn, and don’t be too excited :)

#183 Bonhomme Carnaval on 07.18.17 at 11:44 pm

@ #176 Leo Kolivakis on 07.18.17 at 11:09 pm

Many came before Tsipras–since the end of the military junta (1967-74).

ALL raped and pillaged and nobody said or did anything to stop them. Why? Because they all had their hand in the cookie jar.

“Making Canada Great Again” ? Me thinks you mean “Canada’s Back!”

If the Liberals win in 2019, it’s because the average citizen is far more concerned about picking lint out of their belly button, and posting it on Facebook & Instagram, than educating themselves.

Same as Greece. And why we have $ 1.5M shanty semis in questionable Toronto nabes.

Lastly, Romanticism is so 19th century.

#184 viorelli on 07.18.17 at 11:48 pm

the commies are coming

#185 Cici on 07.19.17 at 12:08 am

Idiotic, especially at a time when we need more doctors, not less. Not to mention more companies and corporations paying decent “middle class” salaries for full-time positions.

I’m almost certain this will result in an an uptick in tax evasion that will cost the government far more in revenues than these new regulations will ever bring in. Besides, wasn’t his first experiment with eat-the-rich taxation policies an admitted flop?

#186 Avoider on 07.19.17 at 12:18 am

A few years ago I lied on my tax return and benefited to the gain of $5k. Does this make me a bad person? Does it?

#187 Avoider on 07.19.17 at 12:20 am

The $5k I paid my wife from my corporation and said that she was an employee. CRA had no clue!

#188 meslippery on 07.19.17 at 12:20 am

The poor people making minimum wage with no benefit’s
have to work all week (40hrs) for 1.5 to 2 hrs in a dentist
chair. Yeah a walk in their shoes.

#189 Stock Picker on 07.19.17 at 12:21 am

DELETED

#190 diharv on 07.19.17 at 12:38 am

As owner and sole shareholder of a CCPC , I was not aware that I was rich or wealthy until today . Kind of flattering , but I wish I felt that way myself .Not sure how these new rules will affect me if at all. My wife works for me , but as a salaried employee as she is not a shareholder so no worries there . As for the passive investment income , I was not aware that it was taxed at the lower corporate rate like Morneau wants us to believe. Active business income , or profit , is taxed at the lower corporate rate . For years I have been paying the highest rates possible for the gains on the retained earnings , approaching 50% on interest income . I assume I’m not paying 18% on capital gains or dividends either. So is my accountant the only honest one in the country or have I been paying more tax than I should have been for years and years ?

#191 InvestorsFriend on 07.19.17 at 1:07 am

Bravo to Dr. Alkex who just pays his taxes

#66 Alex on 07.18.17 at 6:51 pm said:

well, I’m a doctor and I do fully agree with Morneau !
I am not incorporated and do pay back more than 50% of what I earn to our country.

It’s time that all my colleagues do the same, as well as everyone having a ‘fake’ inc. just for the sake of saving taxes.

************************************
Bravo to Alex who knows well that much of this income splitting and having family as shareholders in a business that only earns income from the one professional is in substance tax evasion. Glad to see a stop put to it.

As far as higher tax on retained earnings in a corporation that could hurt me a lot but if it improves tax fairness so be it.

We would not need 50% marginal tax rates if not for the myriad of tax breaks a lot of people are getting.

Given a certain level of needed government expenditure, every dollar of tax breaks and tax avoidance and tax evasion is made up by someone else. Hello 50% marginal rates.

#192 Leo Trollstoy on 07.19.17 at 1:09 am

Want a high paying tech gig? Come to Toronto!

https://www.usatoday.com/story/tech/2017/07/18/top-cities-tech-jobs-now-include-atlanta-and-toronto/484759001/

Always big demand in tech!

#193 Freedom First on 07.19.17 at 1:22 am

#132 Flop

FLOP, ***** Post!

With perfect delivery!

Still smiling.

Freedom First.

#194 Ponzius Pilatus on 07.19.17 at 1:30 am

N#127 Muttley O’Toole on 07.18.17 at 8:42 pm
My old man gave me two pieces of advise when I left home and in Trudeau’s case it seems appropriate:
1) Beware the man wearing brown to town.
2) Never look anyone in the eye whilst eating a banana.
——————
You just cracked me up.
I hope you keep on posting.

#195 Nonplused on 07.19.17 at 1:51 am

#149 A Reply to #107/#109 Nonplused

I read the whole book. You cannot raise taxes on something without raising the price. Those things that can bear higher taxes will, but only at the result of higher prices. It is the consumer that pays all taxes, not the producer.

There are some exceptions, for instance royalties in a global market like oil. But labor is not one of them. Raise the taxes on minimum wage workers from whatever it is now to 50% and the minimum wage has to go up too. So to belabor the point, if the minimum wage is now $10 but the tax rate on these people is effectively 0%, if you raise the tax rate on minimum wage to 50% they are now getting $5 per hour. They will need an increase to $20 an hour to be where they were.

You can’t tax doctors. You can only tax their customers through the doctors. That’s how the invisible hand guides prices.

#196 Nonplused on 07.19.17 at 1:58 am

#149 A Reply to #107/#109 Nonplused

PS your cited economic research assumes some very unreal prepositions. Demand is not infinitely elastic. There are no alternatives to doctors other than holistic doctors and they will also be affected. Prices for all classes of alternatives will go up because they are all affected.

Your paper’s ideology seems to be that if we taxed all food more the farmers would pay it or the people would eat dirt. It doesn’t work, it’s a bogus article. There is no alternative to all labor and especially skilled labor.

I have extended the definition of “the invisible hand” slightly but I think I did so correctly.

#197 Freedom First on 07.19.17 at 2:01 am

I am of the age where I have had both my prostate and my testicles physically checked by my Dr.

Don’t worry, my health is excellent, I am also very fit, and as fine an example of manhood one could hope to find.

However, if your Dr. happens to read this Blog regularly, judging by a significant # of the posts today, I would be reluctant to have these 2 checkups done.

#198 Fat Cat on 07.19.17 at 2:07 am

Look folks, this legislation, which I welcome whole-heartedly, is meant simply to level the playing field between my large corporations and the “mom and pops”. For instance I own a large accounting firm and with taxes and office rent and insurance and overhead and on and on I have to charge $350 an hour for a grad just out of university who hasn’t been accredited yet. I can’t be competing with an experienced and accredited accountant who charges half the rate as an independent working out of his house!

My friend owns a car dealership and he can’t compete with the guys working out of a warehouse, this has to stop.

At the golf club there is also a guy who owns a large electrical company. How is he going to stay in business if all his employees keep going independent and undercutting him?

This bill is about protecting big business, as the government should. That’s what government is for, making sure I keep my large slice of the pie even if you don’t get any.

#199 Nonplused on 07.19.17 at 2:33 am

#149 A Reply to #107/#109 Nonplused

Oh and I have to post one more concept that totally disproves your bogus article: Tobacco and alcohol taxes.

There is a reason you have to pay $30 for a 15 pack of Molson rather than $8 like you would for a 24 pack of Coke. Taxes. Molson does not pay those taxes, you do. Molson can’t unless they charge you more. But the demand is “inelastic”.

Same with tobacco. A pack of smokes should probably cost around $4, but yet it’s $14 due to taxes. Who pays that? You do (if you smoke).

Incidentally this is the reason dope is illegal, because it is an alternative to tobacco and alcohol and would cut into taxes. But I think they are figuring out how to tax it now which is why it’s being considered for legalization. There is still a real problem with it though because too many people know how to grow it in their backyard so it’s hard to tax.

#200 Dave on 07.19.17 at 2:38 am

Morneau’s proposal is welcome news in my eyes. There is nothing fair about tax loopholes, and maybe the market will push for higher compensation to offset the higher taxes…maybe not. Doctors won’t all move south of the border if they have to pay more taxes, some might but some will move to Canada still from other countries, this is just fear mongering 1%er talk. The US can be saturated with Doctors, the world has millions of them and we can’t use the highest paying countries as the only benchmark. They are compensated very well in Canada and we can recruit from all over the world, it’s not a big deal.

#201 Myra Andrews on 07.19.17 at 2:41 am

July stats for Vancouver area
Below is for Metro Vancouver but not the Fraser Valley

July 18 New 275 Sold 128 TI: 9858
July 17 New 362 Sold 162 TI: 9767
July 14 New 164 Sold 109 TI: 9698
July 12 New 288 Sold 184 TI: 9702
July 11 New 282 Sold 148 TI: 9635
July 10 New 399 Sold 147 TI: 9576
July 6 and 7 New 387 Sold 273 TI: 9404

Both real estate boards GVRD + FVRB

=====New Sold Sell/List %
July 18 439 225 51.3%
July 17 477 228 47.8%
July 14 319 145 45.4%
July 13 301 251 83.4%
July 12 448 243 54.2%
July 11 444 251 56.5%
July 10 588 224 38.1%
July 7 368 201 54.6%
July 6 374 225 60.2%
July 5 502 231 46.0%
July 4 696 195 28.0%

#202 JimmyTwoTeeth on 07.19.17 at 2:49 am

http://www.bbc.com/news/business-40649522

Canadians selling up and moving to the US, helping to propel a new bull run there.

#203 Howard on 07.19.17 at 3:00 am

#160 Vanrentor on 07.18.17 at 10:22 pm
An entertaining RFD thread about a guy who got bought at the GTA peak and cant get out.

http://forums.redflagdeals.com/sticky-situation-how-move-forward-2113394/

His house horniness has ruined his finances for the next decade.

—————————-

Thank you for sharing. Should be required reading for everyone before they buy a new house.

The guy in that thread seems to keep blaming his RE agent. How can someone be so weak-willed as to feel pressure from a loathsome, talentless hack to whom one owes NOTHING?

#204 Bobby on 07.19.17 at 3:30 am

Remember, it’s all about feelings. My guess is those who elected our PM also voted for the coalition of clowns here in BC.

I once met a cab driver who thought that Dr’s should make the same as garbage collectors.

One has to wonder what is the point of working hard.

#205 S on 07.19.17 at 5:01 am

What I said stands. Many pensionless professionals live modestly in order to create their own retirement fund within a corporation. That’s one result of a disciplined mind. — Garth

That’s what I thought we were doing… Alas, next week a letter goes to our MOAs informing them of upcoming cutbacks in available working hours. What is the point of slaving 80 hours a week if one cannot fund his own retirement. (Docs do not have a government funded retirement pension plan.) There of course is the small matter of a six month wait list of patients but I’m sure someone will be made available to see them in a reasonable time frame as this government seems to have all the answers.
To those posters daring your doctors to get up and leave, no, most won’t. They’ll just remember that they have kids and spouses at home who would like to see them and work fewer hours. If you think it is hard to find a physician now or that waiting eight months for a surgery is a long time you ain’t seen nothing yet. Expect a full blown healthcare crisis.
Unless, of course, the provincial governments that actually pay the physicians come to the rescue and increase fees to undo the damage the federal government is about to do. In which case this will simply be the case of the feds robbing the provinces. What an ingenious way to get back the health transfer payments.

#206 S on 07.19.17 at 5:21 am

BTW, has anyone here noticed the recent proliferation of private clinics offering cosmetic procedures? Many physicians are already looking for ways to get from under the provincially funded systems so that they can control their fee schedule. The current development will just push more of them to seek alternative ways to make a living.

#207 reality 1 on 07.19.17 at 5:49 am

regarding comment # 174 “Ron”

Absolutely correct !

I was in Toronto recently for a few weeks and you hit the nail on the head.

We call it “see me, dig me” syndrome.

Canadians are massively insecure – any competent psychologist can tell you that.

Ergo, the emphasis on “home ownership” and “hot cars”.

They are wiling to bankrupt their futures to “feel good about themselves ” today in the eyes of their peers.

Ultimately and ironically, their insecurities and deepest fears of ‘being a nobody” will be realized – and when they are so deeply screwed that they can do nothing to alter it.

I predict a high rate of ‘depression’ and suicide will likely follow.

Weak minds born of entitlement and no adversity don’t survive well when their sense of self-worth is upended.

#208 neo on 07.19.17 at 6:39 am

#61 Smoking Man on 07.18.17 at 6:47 pm
Etobicoke market up date.

House one street over on 38th that sold in April for 1, 060, 000. Deal fell trough. Re listed sold yesterday for 1, 010, 000

My truck broke down while giving away clothing and furniture, that’s karma I guess. Took CAA 3 hours to come get me. A house accros the street for sale. In those 2 hours 4 people visited.

Like I said before averages to not tell the true story.
Whats driving it down so much is houses that sold for 2.5 are now going for 2.1

And listings are coming off the mls. Might see a mini surge as pre approved buyers pounce to lock in the low rate.

*******************************************

Not this time Smoking Man..The herd you talk about so much are in catching a falling knife mode. When they expected prices to keep going up…Sure, I would agree with you..But NOW they expect prices to keep going down…Inventory while down is still WAY to high for this time of year. Unless it gets cut in half by September listings will spike again and there will be even more inventory to clear. Too many homeowners out there unwillingly to accept January prices in order to clear current inventory and allow a dead cat bounce to happen.

#209 Wrk.dover on 07.19.17 at 6:45 am

#199 Fat Cat on 07.19.17 at 2:07 am
Look folks, this legislation, which I welcome whole-heartedly, is meant simply to level the playing field between my large corporations and the “mom and pops”. For instance I own a large accounting firm and with taxes and office rent and insurance and overhead and on and on I have to charge $350 an hour for a grad just out of university who hasn’t been accredited yet. I can’t be competing with an experienced and accredited accountant who charges half the rate as an independent working out of his house!

———————————————-
You may be an accountant, but, you don’t know the value of money.

When billing, sky is not the limit.

You should be employed by a government.

#210 Here's The Deal on 07.19.17 at 6:49 am

#59 Willy H

“They breed like rats in a low interest rate nest and feast on GTA Mandarin buffets and Krispy Kreme donuts.”
——————————————————————–

Here’s the deal:

That is the most eloquent and accurate description of the low-life pseudo-rich typical Toronto scumbag parasite wannabe white-trash rodents I have ever read.

Nice post Willy!

#211 Dentabroad on 07.19.17 at 6:55 am

My 3 cents say we should be immigrating Dentists and education (private schools) as many kids who want to be Dentists as we can.

And then lifting barriers to them practicing. Only reason salaries are so high is the profession restricts entry. Hopefully will come to an end with globalization.
____

The profession is self-regulating and costs the Canadian taxpayers basically nothing. The professional bodies and the 10 accredited Universities that train dentists in Canada restrict entry to protect the public from dentists who are trained in countries where the standards are much lower. A very high percentage of them are not able to pass Canadian Board exams. Getting into dental school in Canada is very difficult. You must have very high grades and a high DAT score (eliminating those without the necessary spatial awareness and hand skills). As a lower cost alternative -you can go on a vacation in Mexico and have your teeth done, then redone or removed when you come back!

I think taxing Professional Corporations is a bad idea overall as it will likely encourage professionals to leave. I don’t think realtors should be allowed to incorporate however, but that is because I am envious of how they can finish their entire career training program in about a third of a university semester!

#212 Cottingham a bargain on 07.19.17 at 7:58 am

DELETED

#213 Shawn on 07.19.17 at 8:02 am

The speed of the housing correction is what is most telling. Housing markets have not moved this “fast” in the past. One could attribute it to the speed at which information travels today or the extreme climactic nature of the peak (ie up 30%+ in 1 year).

Either way this could be only the VERY beginning. It’s only been 2 months and prices are down 15-25% on most peripheral GTA markets.

#214 M.T. on 07.19.17 at 8:03 am

***To those posters daring your doctors to get up and leave, no, most won’t. They’ll just remember that they have kids and spouses at home who would like to see them and work fewer hours.***

Completely agreed – this sensible comment strikes beyond the rhetoric at the real issue. I actually would consider moving to the US, because I’m young and I like the US for other reasons anyway. But it’s true, most won’t. They’ll just work less. It’s almost like these people don’t understand incentives.

I’m tired today. I worked overnight at the ED at my small, local community hospital, because they’re chronically short-staffed and they need me. Well, I ain’t doing it anymore, not if they’re going to hoover 51 percent of what I “make”.

#215 nick on 07.19.17 at 8:14 am

lots of mortgage agents use corps as well.

#216 Sam on 07.19.17 at 8:15 am

Manufacturing plant closing in Tillsonburg near London – more jobs lost! Good work Truedoh. What socks is he wearing today?

#217 Sam on 07.19.17 at 8:18 am

@Leo Trollstoy
Anyone with talent in tech would never move to Toronto. If they are skilled software developers they are generally intelligent enough to know that moving to Toronto is akin to throwing their life away sitting in Traffic for > 2 hrs each day and paying obscene amounts for rent or housing.

#218 Asterix1 on 07.19.17 at 8:25 am

#204 Howard on 07.19.17 at 3:00 am
#160 Vanrentor on 07.18.17 at 10:22 pm
An entertaining RFD thread about a guy who got bought at the GTA peak and cant get out.

http://forums.redflagdeals.com/sticky-situation-how-move-forward-2113394/
____________________________________________

Was reading a few posts from this individual. He is obviously a speculator, yet refuses to accept it as he is trying to garner advice to save his skin.

The buyer (liar) says “The moment I accepted I went home and was faced with the reality of how I’m going to make the payments”

Enjoy the crash!!!

#219 The Art of the Possible on 07.19.17 at 8:26 am

The government is strapped, and it is only going to get worse. While I hope their attempts to stimulate the economy are fruitful, it may take decades for the results to be fully realized, if at all. Taxation is a necessary evil and while I do not wish to see self-employed people hit hard, they do represent a group that many of the rank and file perceive as “privileged” and thus “deserving” of these measures.

Bollocks to Bill or anyone else that believes that (and I bet Morneau doesn’t) but he is in politics. As the German leader Bismark said, “Politics is the art of the possible, the attainable – the art of the next best”. It is far better to have a healthy economy but ahead of the coming wave of expenses to pay for aging boomer health care, the government needs more money. Everyone will just have to suck it up.

#220 crowdedelevatorfartz on 07.19.17 at 8:36 am

@#203 Jimmy Two teef
” What has more feet than teeth?
“A lineup to the washroom at a Monster Truck Rally”

“What has more feet than teef’
” A lineup at a voters booth in a US election”

“What has more feet than teeth?”
” A Branson Missouri Dolly Parton Fan club.”

“What has more feet than teeth”
” A realtor after his clients realize how low this market is going”

#221 Cottingham a bargain on 07.19.17 at 8:40 am

#213 Cottingham a bargain on 07.19.17 at 7:58 am
DELETED
——-

What is fundamentally wrong with abolishing cash Garth? Seems to me it would eliminate a lot of fraud in the system , get everyone paying their fair share of taxes, not to mention crime related to illegal drugs et all.

Nothing. What’s wrong is your mindless disparaging of an ethnic group. — Garth

#222 -=jwk=- on 07.19.17 at 8:40 am

@ 131

@ #13 mike. You’re free to quit your job, start a company and pay your stay-at-home wife a salary too.

What’s stopping you?
————————-

Why does he have to do that to be treated fairly? You are admitting that $1 in earned salary is not the same as $1 earned in a corporation. Hey where have I heard that before? Oh right, Bill’s announcement where he stated that the purpose of the change was to make a dollar earned be treated the same everywhere.

#223 BMC on 07.19.17 at 9:00 am

#107 Nonplused

Increasing taxation that ultimately leads to higher consumer prices works out pretty good for governments that also have percentage based goods and services taxes, don`t you think

#224 BR E19 1-D-1 on 07.19.17 at 9:02 am

‘Another T2 grab. Makes you wish for a Trump. Almost’

Almost? T2 has, what, another three years to make mischief? MY prediction – You WILL

#225 Vanrentor on 07.19.17 at 9:03 am

#219 Asterix1 on 07.19.17 at 8:25 am
#204 Howard on 07.19.17 at 3:00 am
#160 Vanrentor on 07.18.17 at 10:22 pm
An entertaining RFD thread about a guy who got bought at the GTA peak and cant get out.

http://forums.redflagdeals.com/sticky-situation-how-move-forward-2113394/
____________________________________________

Was reading a few posts from this individual. He is obviously a speculator, yet refuses to accept it as he is trying to garner advice to save his skin.

The buyer (liar) says “The moment I accepted I went home and was faced with the reality of how I’m going to make the payments”

Enjoy the crash!!!

———————

The funny part is that his biggest concern is that he won’t be able to go on vacations and go out for nice dinners.

#226 Yuus bin Haad on 07.19.17 at 9:06 am

Bill assured me that in his family business he always plays fair and doesn’t use the tax code to cheat the system.

#227 SheCallsMeDaddy on 07.19.17 at 9:09 am

#45 Winston on 07.18.17 at 6:19 pm

Welcome to Canada (Cuba):
Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery.
=================================
Socialism is the exploitation of man by man, capitalism is the opposite.

#228 After Communism on 07.19.17 at 9:29 am

#199, I got the sarcasm. I think the Harper income trust tax increase had the same effect. He lost the election over that, plus his pro-Obama wars, pro-immigration, and making himself indistinguishable from the Liberal party.

#229 Ole Doberman on 07.19.17 at 9:35 am

#39 Bill Grable on 07.18.17 at 6:09 pm

Here in delusional Vancouver, you can just about feel the angst in the smoggy (*forest fires) air.
Shacks for $2 million. Rents? Try, I have seen ads asking $3000 plus for a tiny 2 bedroom.

Everyone is freaking out – but trying to act cool.
When the rates go up a bit more, this small avalanche will build and bury a TON of people in a mountain of debt. Many of my coterie (Boomer) are retiring and thinking they can pay off that “Line of Credit” and all the credit cards, when they sell their home. Sell to whom?
The Sales in the GTA have gone south, and it’s starting here. It is going to be a long ugly slog – BUT – if you have been following Mr. Turner, you know all this.

Get rigged for heavy weather….I am going to put a reef in the main sail….and stay out of the way of the oncoming train. Vancouver has been turned into a cornucopia of construction – and has destroyed whatever character this City once had. The condos are being slammed up – and I wonder who is going to buy them all? Here’s a hint – I rent in a building where the majority of the owners live in China. How can they buy these very expensive joints, when they are only allowed to take a relatively small amount of cash, out of China?
Something smells.
——————————————————–
Ya it’s all totally disgusting.

When I go for a walk at lunch in downtown Calgary it’s the same thing, I’m seeing a new luxury condo cropping up wondering aren’t we in a recession and rates are rising?!
Who is going to buy this – then it dawned on me they must have a broker with a life line to HAM, sheesh.

This will never end.

#230 HaHaHa on 07.19.17 at 9:48 am

Wow lots of bickering on this one. I love all this talk of middle class though. Has anybody defined what the income of a middle class family is? The answer is no. It is a generic term thrown around by politicians but never defined. This way everyone can bitch about the rich guy cause hell I am middle class. When it comes to doctors my hat is off to these guys. As I sit in a doctors office I can’t help but look around and see the typical patients. 80% of them are in there seeking treatment for self induced medical problems. Smoking all their lives dragging scott air packs. FAT people with overactive thyroids. Couldn’t be all the junk they eat. Canadians are self entitled lazy people whether it be physically, financially. We all deserve another Trudeau and we got him. Oh sorry. We are good at hockey.

#231 Eks dee Sipal on 07.19.17 at 9:51 am

#136 im not buyin’ what dey sellin’… “the Omar Kadr operation has many purposes
you will never know the truth
one thing i can assure you, there is no 10 million”

Finally. Someone with a brain. ALL NEWS IS FAKE. Read it again and again until this sinks in: Content Creation for Profit. That’s all it is. Why would anyone give you the news for free? Every second of airtime and screentime is bought and paid for. Simple. Easy like Sunday morning.

Nothing wrong with healthy skepticism. Just understand the pro-Trump news is as ‘fake’ as the anti-Trump stuff. — Garth

#232 Cottingham a bargain on 07.19.17 at 9:53 am

#222 Cottingham a bargain on 07.19.17 at 8:40 am
#213 Cottingham a bargain on 07.19.17 at 7:58 am
DELETED
——-

What is fundamentally wrong with abolishing cash Garth? Seems to me it would eliminate a lot of fraud in the system , get everyone paying their fair share of taxes, not to mention crime related to illegal drugs et all.

Nothing. What’s wrong is your mindless disparaging of an ethnic group. — Garth
—-

I belong to the same ethnic group and do not consider what I wrote to be disparaging . That same ethnic group
Would largely agree that “cash is king” in the community

#233 Dekard on 07.19.17 at 10:03 am

Garth, what could possibly happen with retained earnings within the corp? considering it has already been taxed a corp rates. Would they really consider those Corps being double taxed?

#234 Nick on 07.19.17 at 10:11 am

The CBC article on the new “Tax the Wealthy” – http://www.cbc.ca/news/politics/morneau-tax-changes-wealthy-consultations-tuesday-1.4210201

From Billy himself – “I have not done my homework on how I will be impacted, but I expect the implication will be I will pay more taxes over time”

That’s our finance minister saying he doesn’t know how these changes will affect him. Either he’s full of $hit and playing stupid or he really is stupid.

#235 It's not unfair -- it is an INCENTIVE on 07.19.17 at 10:15 am

All this talk about leaving the country is BS.

As someone else wrote in the comment section, people base their decisions on after-tax income, i.e. their take home pay. When that changes, behavior changes.

For example, doctors could just decide to work less.

For me, I’m an IT Contractor, incorporated, as required by my clients. I make about 120K/year no benefits. My equivalent full-time salary is also 120K/year, but then I’d have benefits, stat holidays, vacation, sick days, etc.

Therefore, the main benefit of incorporating is tax advantages. It isn’t “unfair”… it is designed to be an incentive. I take on risk that the projects get cancelled and I’m let go the same day. (This has happened 3 out of 15 clients I’ve been with). Contractors are the first to let go, and the first to suffer during downturn. In 2008, I was out of work for 4 months and had to take a pay cut. I earned 50K that year, and 60K the year after. no EI.

Contractors provide a valuable service. But if there is no financial benefit for me, then I will just seek out a lazy full-time position, maybe as an architect at some government organization. Or, we’ll see what my peers do — if enough people leave, that will give us more leverage to raise rates.

And consumers will suffer.

BTW, one of the biggest hires for IT contractors are banks and government. Think about that.

#236 Centre Wing on 07.19.17 at 10:18 am

This Regressive Left cheerleader Mike is an interesting fellow.

#237 A Reply to #196/#197/#200 Nonplused on 07.19.17 at 10:19 am

You’ve never studied economics, have you?

I don’t really have the time or energy to tutor you, but here are some links to basic time-tested economic theory:
https://en.m.wikipedia.org/wiki/Economic_surplus

https://en.m.wikipedia.org/wiki/Tax_incidence

https://en.m.wikipedia.org/wiki/Deadweight_loss

https://en.m.wikipedia.org/wiki/Price_elasticity_of_demand

https://en.m.wikipedia.org/wiki/Price_elasticity_of_supply

https://en.m.wikipedia.org/wiki/Economics

#238 SimplyPut7 on 07.19.17 at 10:20 am

Canadian retailers are in trouble if the US has this section of NAFTA updated:

The U.S. requested that Ottawa raise the value of goods that Canadians can buy online without paying import duties and taxes to US$800 (C$1,011 ), up from its current level of C$20.

http://globalnews.ca/news/3605878/trump-asked-canada-to-drop-duties-on-internet-imports-under-nafta-canadians-should-cheer-say-experts/

I’m happy for Canadian shoppers, but Canadian retailers can’t compete with most online sales coming from the US sites, especially Black Friday and Cyber Monday deals.

#239 Tazi Bnu on 07.19.17 at 10:30 am

Hey Garth,
What’s the effect going to be on the corporate portfolios, are they going to be liquidated? If so, what kind of selling pressure will that have on the Canadian markets?

#240 Livin Large on 07.19.17 at 10:32 am

It’s rather amusing seeing how many folks here consider an annual gross income of $200K less than wealthy.

According to Statscan and updated only 7 days ago, the median family income in Ontario (median not average. As many above as below) is $81,480 in 2015.

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil108a-eng.htm

So, a doctor earning $200K is “well off” not wealthy? And if incorporated they can “sprinkle” income to lower bracketed family members to effectively reduce their total family effective tax rate?

In my world, anyone or any family earning more than the median is “well off” and any earning more than double median are wealthy. Stratospheric Super Rich? Hell no but still hardly warranting an affirmative action tax benefit.

Yes, doctors especially, can have seriously stressful lives and are more than entitled to be compensated appropriately to provide such valued service to the community but let’s stop implying that more than double the median family income is some sort of upper middle class abyss requiring pity and special tax treatment.

As I read the official announcement of these changes, while they will impact doctors, doctors comprise a small proportion of the self employed contractors utilizing the incorporation benefit loopholes and those are likely to be the CRA’s target for evaluation.

Case in point, I bought carpet a year ago and when talking with the salesman I learned that all the professional carpet sales people in his chain of stores are
incorporated “brokers” rather than commissioned sales employees. IMO that’s nothing more than “working the system” and abusing the intent of Income Tax Act.

This “means test” concept doesn’t seem any different than CRA questioning the deductions claimed for “office in home” made by commissioned emoloyees with T3s rather than T2s. The deduction must be “reasonable” and justifiable.

#241 Oakville Rocks! on 07.19.17 at 10:33 am

Great column as usual Garth. Sad about the comment section though. An important issue that deserves a fair and intelligent discussion. That seems mostly impossible here these days.

My family has run a small business since the mid 80’s. Started from our basement and grew to an operation that employs 15 and operates out of Burlington. Both my mom & dad worked here, legitimately. The only time I made company money was when I worked and then I was paid a fair wage. Perhaps you would say we were stupid or perhaps my family believes in fairness.

It is the job of the Minister of Finance and Revenue Canada to ensure the tax code is fair for all and not subject to exploitation. When they notice an explosion of CCPC’s they have to investigate and determine if the small business tax provisions are being exploited for purposes other than what they are intended. The same goes for people who flip houses (as a business) and try to shield income using the primary residence provisions.

Personally, I think income sprinkling for work not done should be held in check. Using a corporation to shield personal investment income so it is subject to the 10.5% small business tax rate seems dubious as well.

Calling what Morneau is proposing a punishment for hard work seems more like a politician’s talking point than a balanced assessment of the changes to the tax code. And sure I am affected, I am wondering how we will get the retained earnings out of the company when we retire without a massive tax bill. And yes we have a plan.

Keep up the great work Garth, maybe consider changes to the comments.

Lastly to some of the more hateful commenters, if you hate or do not like where you live, move. Why come here to insult those that live there or their houses or their communities? Offer up constructive criticism. I agree Milton and North Oakville are at risk of becoming as bad and poorly planned as Mississauga, Brampton and most of Toronto. But the people who live here are great neighbours who take care of their properties and love this country and this community. I would hate to see them at a disadvantage because of poor financial decisions. Hope you all can say the same.

#242 Eks dee Sipal on 07.19.17 at 10:43 am

#175 bdwy sktrn… “jet exhaust is water.”

https://en.wikipedia.org/wiki/Jet_fuel

Yeah, you can drink it, not. Actually, jet engines are a significant environmental pollutant. Remember a couple of decades ago how David Suzuki was flying around the world, telling people to stop polluting the earth? LOL.

And something most people don’t know is that a tiny bit of water is added to fuel (e.g., often secretly incorporated into fuels for small 2-stroke diesels also) otherwise it wouldn’t burn in your vehicles. In other words, you might say that it is the water that is burning with the help of the hydrocarbons. Oftentimes, our pretentious scientific theories haven’t caught up with our practical technologies.

#243 InvestorsFriend on 07.19.17 at 10:45 am

Fairness

Fairness is in the eye of the beholder. Usually we will view as fair anything that benefits us personally.

All tax breaks are seen as fair and justifiable to someone.

#244 Tazi Bnu on 07.19.17 at 10:50 am

I’ve got a prediction too, about the doctors. The 60+ ones, with the most knowledge, will retire or become professors at universities around the world, not Canada. The 50-60 ones, with the most skill, will semi-retire. This means no On-Call, reduced hours, reduction in offered services to what is obligatory, and longer vacations. The doctors in their 40s will consider moving, but will probably kick up the most fuss, work to rule. The new doctors will be the most likely to leave if given the opportunity. It’s already near impossible to see a dermatologist in Ontario, and skin cancer is common and easy to treat if caught in time.

#245 Island Millenial on 07.19.17 at 10:54 am

What are professionals supposed to now that a 30 year staple of the tax code is wiped out?

No RRSP room accumulated. Tax planning with your spouse who eschewed a career out the window. Investment planning is screwed, and will be taxed until sold.

I’m usually on the side of ‘fairness’,but there’s no balance to these measures.

The irony is I am taking a corporate tax course, and we basically have to throw a whole chapter away.

Corporate tax accountants just lost a big chunk of their razzle dazzle.

#246 swampcritter on 07.19.17 at 10:55 am

Garth weeps for doctors, but what about Sears employees, Nortel retirees, and the millions of other poor schmucks trying to eke out a living in the gig economy of the neoliberal era

#247 Dan.t on 07.19.17 at 10:59 am

I guess flipping houses and earning massive tax free gain really is the way to go. Didn’t realize that served such an important function in Canadian society.

If you want to find new sources of income go after real estate speculators and those people not claiming rental income ( and believe me, there are many people doing this) . Right, any thing real estate related is all good. Let the good times roll in BC.

#248 n1tro on 07.19.17 at 11:10 am

@#90 Greg

“Sure, they are not “rich”, being in the top 2 percentile, they just earn more than 98 % of us. lol. At least the Prime Minister can figure that out.”

Perhaps doctors earn more than 98% of us because maybe, just maybe, they are smarter than 98% of us? I can’t make the same comment about other professions but I’m glad doctors make more than me and should be allowed to use all the tax advantages.

I don’t see anyone complaining about Bill or Justin having used the same “loopholes” in the past to amass their wealth. BTW, Justin makes about $360K a year as PM for doing what exactly….

#249 Victor V on 07.19.17 at 11:29 am

‘Playing with fire’: Housing experts warn OSFI against new stress tests

http://www.bnn.ca/playing-with-fire-housing-experts-warn-osfi-against-new-stress-tests-1.808316

#250 A Reply to #244 InvestorsFriend on 07.19.17 at 11:35 am

“All tax breaks are seen as fair and justifiable to someone.”

My preference has always been a land value tax.

https://en.m.wikipedia.org/wiki/Land_value_tax

https://en.m.wikipedia.org/wiki/Optimal_tax

#251 Eeatender on 07.19.17 at 11:43 am

But it’s unfair when rules are changed for the express purpose of penalizing success, hard work, risk or the acquiring of skills essential to the public good.
——————————-

Not a fair statement!!!!

#252 Another Deckchair on 07.19.17 at 11:45 am

Wait a sec – if my wife makes much more than I do, why should I make her an employee of my Corporation? It’d get taxed at her marginal rate, I’d expect.

I may be missing something here.

Oh well. “live beneath your means” means that we save at least 50% of our income; the moaners here should try adjusting their lifestyle so that they can do the same.

I guess moaning’s easier.

#253 Eeatender on 07.19.17 at 11:46 am

@#13 (Mike)
Best comment if the day.

Intellectual honesty should be fair. People take sides based on them their interests.

#254 n1tro on 07.19.17 at 11:53 am

@#189 meslippery on 07.19.17 at 12:20 am

“The poor people making minimum wage with no benefit’s have to work all week (40hrs) for 1.5 to 2 hrs in a dentist chair. Yeah a walk in their shoes.”

Awww…poor folks have it hard?! Canada is a land of opportunity. Grow a brain, go to school and get a better career! Can’t because of , then pray you get re-incarnated as a silver spoon, trust fund, douchebag in the next life because life is NOT fair.

#255 Victor V on 07.19.17 at 11:55 am

“The most profound effect of the higher interest rate is expected to be on real estate purchases.”

http://www.huffingtonpost.ca/salman-sakir/interest-rate-hike_a_23036033/?ncid=fcbklnkcahpmg00000001

#256 TurnerNation on 07.19.17 at 11:59 am

The dentists boat is named Oral Fixation.

#257 Mike on 07.19.17 at 12:08 pm

.
So much of Doctors work so hard, as if no body else does.
So much for Doctor’s spouse gave up career, as if nobody else’s does.
So much for Doctors can make twice the money south of border, as if nobody else can. Just move guys, plenty more to replace you, just like anyone else.

All this is no justification for tax fraud for paying fake wages to spouse and kids who don’t actually work for you.

#258 dee on 07.19.17 at 12:15 pm

The speed of the housing correction is what is most telling. Housing markets have not moved this “fast” in the past. One could attribute it to the speed at which information travels today or the extreme climactic nature of the peak (ie up 30%+ in 1 year).

Either way this could be only the VERY beginning. It’s only been 2 months and prices are down 15-25% on most peripheral GTA markets.

————————–

more to do with extreme climatic nature. You’ll notice that the higher or the longer the move, the more likelihood of a quick, vicious move downward.

#259 Jeff on 07.19.17 at 12:21 pm

Well with that kind of idiots in power, we can expect Canada to become uncompetitive internationaly.

T2 reward failure, penalize success. Next election : Vote conservative.

When our PM go in gay events (penalize family), give 10+ millons to a former terrorist (penalize our vets), legalize Weed (will now open tolerance for harder drugs), raise tax for wealthy (penalize our successful citizens), gosh !

Has our government became criminal ???

#260 Mike on 07.19.17 at 12:31 pm

As said before, I got no issue with this fraud being allowed under ‘professional corporation’ umbrella.

I just wish everyone is allowed to ‘sprinkle income’ and expense personal meals, fuel, conference vacations and leased cars.

If not, then it is indeed about ‘fairness for middle class’.

If you give up pension, benefits and job security and accept the risk of running a business, sure. — Garth

#261 Asterix1 on 07.19.17 at 12:31 pm

#250 Victor V
‘Playing with fire’: Housing experts warn OSFI against new stress tests http://www.bnn.ca/playing-with-fire-housing-experts-warn-osfi-against-new-stress-tests-1.808316
____________________________________________

Another ridiculous article from BNN. They really need to beef up their journalistic skills and stop placing this type of propaganda as Front Page news! Its hard to take BNN seriously!

Article written with statements from:
1. CIBC Deputy Chief Economist, Benjamin Tal.
2. Rob McLister, Mortgage planner

Two guys with lots of biased opinions who would love nothing more than for the status quo to remain firmly in place!

OSFI, if you are listening, get the stress test in place. It needs to be done. Interests rates will not be going down, but up, lets get this done asap.

#262 Ponzius Pilatus on 07.19.17 at 12:32 pm

#236 It’s not unfair — it is an INCENTIVE on 07.19.17 at 10:15 am
All this talk about leaving the country is BS.

As someone else wrote in the comment section, people base their decisions on after-tax income, i.e. their take home pay. When that changes, behavior changes.

For example, doctors could just decide to work less.

For me, I’m an IT Contractor, incorporated, as required by my clients. I make about 120K/year no benefits. My equivalent full-time salary is also 120K/year, but then I’d have benefits, stat holidays, vacation, sick days, etc.

Therefore, the main benefit of incorporating is tax advantages. It isn’t “unfair”… it is designed to be an incentive. I take on risk that the projects get cancelled and I’m let go the same day. (This has happened 3 out of 15 clients I’ve been with). Contractors are the first to let go, and the first to suffer during downturn. In 2008, I was out of work for 4 months and had to take a pay cut. I earned 50K that year, and 60K the year after. no EI.

Contractors provide a valuable service. But if there is no financial benefit for me, then I will just seek out a lazy full-time position, maybe as an architect at some government organization. Or, we’ll see what my peers do — if enough people leave, that will give us more leverage to raise rates.

And consumers will suffer.

BTW, one of the biggest hires for IT contractors are banks and government. Think about that.
————
Again, people don’t see the big picture.
Outside contractors are considered parasites by regular employees. Most of them are providing services that could be done by regular employees at a lower cost.
They destroy moral and lower overall productivity.
I’ve been there, seen that.
To understand, you should study Organizational Behaviour.

#263 Blacksheep on 07.19.17 at 12:36 pm

JSS # 49,

“If doctors don’t like the new rules, then they can GTFO to the states. Canada currently has a good supply of immigrant doctors, as well as Canadian medical students who will want to stay and contribute to this great country.”
———————————————
Well, according to my family physician of 20 + years in Delta BC, your dead wrong.

He, is now less than two years from retirement and told me, he cannot sell his thriving practice do to the fact new doctors are heading straight to the hospitals where they can work a fixed shift, while making good coin.

They (many, not all) are not interested in family practices do to all the costs and responsibilities associated with its operation.

JT and the sunshine band are about to make this deteriorating situation, much worse.

#264 Ponzius Pilatus on 07.19.17 at 12:37 pm

The only reason why Doctors are considered rich is because half of the population is working for minimum wages.
It’s all relative.

#265 Dan.t on 07.19.17 at 12:43 pm

http://www.bnn.ca/playing-with-fire-housing-experts-warn-osfi-against-new-stress-tests-1.808316

I bet the BNN experts all just recently picked up a few investment condos or just got into a 1.2 mil semi. The vested interest in keeping prices high all over Canada is insane.

What ever happens, we can’t mess with peoples equity. Explain why that is an issue as opposed to affordable housing policies?

I wish i could leverage a stock investment and have everyone fight tooth and nail to make sure may massive leverage gains never fall.

#266 Dan.t on 07.19.17 at 12:46 pm

“As we’ve seen time and time again, onerous mortgage regulations aren’t necessarily a death knell for housing,” said McLister.
“But if housing does dive because of OSFI’s move, not only will policymakers and our real estate-dependent economy get burnt, but so will anyone who relies on home equity.”

From the article just posted. Who relies simply on home equity? I don’t get that comment. It’s call speculation if you only built up a small amount of home equity and are relying on it for what exactly??

#267 IHCTD9 on 07.19.17 at 1:07 pm

Trudeau has spent all the money, that’s all you need to know. Their answer is (shocker) to raise taxes – but let’s call it fairness for other folks who actually see no material change in their condition whatsoever.

Fairness is talked about only when dollars end up rolling into the Federal coffers. Actually IMPROVING a Canadian’s situation is not on the agenda as that would cost money. No, in Canada fairness means the Citizenry is pushed DOWN to the lowest common denominator rather than lifted up to new heights.

Hey, most debt gargling Canadians probably agree with this move – why should those rich bastards who spent half their lives in school get any breaks? They’re doing a hell of a lot better than me, so eat it sukas!

That’s why the few smart Canadians left still living here in Trudopia should be making adjustments to their spending, buying, investing and even earning, so as to offset these new measures. You can bet a lot more of same is on deck, and you can bet T2 and his prepubescent SJW Cabinet will be voted back in for another round of “fairness for the middle class”…

#268 n1tro on 07.19.17 at 1:09 pm

@#259 Mike on 07.19.17 at 12:31 pm
As said before, I got no issue with this fraud being allowed under ‘professional corporation’ umbrella.

I just wish everyone is allowed to ‘sprinkle income’ and expense personal meals, fuel, conference vacations and leased cars.

If not, then it is indeed about ‘fairness for middle class’.

Everyone can “sprinkle income”. Just quit your job, incorporate yourself as a contractor/consultant and find temporary work in your profession. Instead of bitching about “fairness” and hoping others suffer equally, I did it 2 years ago. Know the difference between a good internal employee and a consultant?
Nothing! Except as a consultant, you are paid more to give the same advice that management was/is too stupid to listen to.

Too chickshit to quit your job? Then shut up.
Too dependent on a stable paycheque? Then shut up.
Too uneducated to command more money for what you know? Then shut up.
You get where I am going with this?

Realize that even if all the tax advantages are taken away and assume there are no ill effects on the economy or prices….your situation will still be exactly the SAME. Same shitty wage, driving the same shitty car, living in the same shitty house.

Not such a great victory is it?

#269 Packing for Mexico on 07.19.17 at 1:24 pm

#200 Nonplused on 07.19.17 at 2:33 am

#149 A Reply to #107/#109 Nonplused

Oh and I have to post one more concept that totally disproves your bogus article: Tobacco and alcohol taxes.

There is a reason you have to pay $30 for a 15 pack of Molson rather than $8 like you would for a 24 pack of Coke. Taxes. Molson does not pay those taxes, you do. Molson can’t unless they charge you more. But the demand is “inelastic”.

Same with tobacco. A pack of smokes should probably cost around $4, but yet it’s $14 due to taxes. Who pays that? You do (if you smoke).

Incidentally this is the reason dope is illegal, because it is an alternative to tobacco and alcohol and would cut into taxes. But I think they are figuring out how to tax it now which is why it’s being considered for legalization. There is still a real problem with it though because too many people know how to grow it in their backyard so it’s hard to tax.
_________________________________________
Bingo! You cant tax the homegrown stuff, so stupid kid Trudeau and his millennial dope smoking gang of idiots have opened up Pandoras box. It is only going to get worse. My wife and I are retired and non-smokers, quite a few or our neighbors here in our condo are pot smokers and quite a lot are cigarette smokers. My wife also has asthma. Some of them actually grow pot on their balconies. We can see it. We thought this would be nice to close the door and go south to Mexico every year in the winter and now we don’t want to come home in the summers as she has trouble breathing and it stinks up our place. Its only going to get worse now that our idiots in Ottawa see $$ in legal pot.

#270 Victor on 07.19.17 at 1:30 pm

18% decrease eats 22% increase.
24.8% decrease eats 33% increase.
If prices go down just 6.8% more it will be March 2016 level. From the current level it is 8% (755K to 690K)

#271 kumbaya on 07.19.17 at 1:38 pm

hard work is for losers. Let your socialist govt reward you for idleness. Come on down, grab a joint and gather on the mat of equality. your favorite eastern religion is welcome here, we are all the same. Welcome to Canada, how can we change for you?

#272 paulo on 07.19.17 at 1:40 pm

so we had wild bills press conference yesterday Outcome:
smoke and mirrors,the so called initiatives will do little more than piss off essential service providers,such as doctors etc. give them reasons to leave our country,and likely cost tax payers 5 dollars for every single dollar of revenue collected what a load of crap.
the real game starts in mid August: the NAFTA negotiations so far our selfie dude is playing his cards correctly,much to my surprise. make no mistake this re negotiation process will have profound effects on our country that will effect our way of life for decades . expect a tough renegotiation process lets hope the selfie team has a game plan and the correct players at the table,we need a strong team with a couple of ,sorry Garth Kevin Oleary types. after all we are up against the self proclaimed best deal maker in the world: bring it on.

#273 InvestorsFriend on 07.19.17 at 1:41 pm

Tax Breaks are easy to give and hard to take a way

Example: TFSA $5000 was a gift (with the lost tax revenue obviously paid by others or borrowed) and so was the increase to $10,000. This blog and others howled to the moon when PART of that GIFT was taken away.

I worked at a big company. Before I joined the company (then smaller) used to give a free turkey at Christmas. Then they stopped. People were still complaining about it when I joined five years after the turkey gift program ceased. No matter all the other perks, take one perk away and people howl. Human nature.

#274 kumbaya on 07.19.17 at 1:44 pm

sackcloth and ashes for the successful. shame on you. Don’t you know under the new laws of equality and non-identity that success now falls under the umbrella of bigotry? naughty, naughty individuals

#275 Damifino on 07.19.17 at 1:45 pm

#264 Blacksheep

They (many, not all) are not interested in family practices do to all the costs and responsibilities associated with its operation. JT and the sunshine band are about to make this deteriorating situation, much worse.
——————————

I agree, although I’d also add that the family doctor is becoming obsolete in a world of ‘apps for everything’.

Many people don’t seem to want to establish a continuing relationship with a doctor that may last for several decades. The aren’t warm to the idea of having a professional who knows you personally and what makes you tick. They don’t seem to think they are partners with their doctors in the ongoing process of their own heath. They see a doctor as little more than a mechanic who fixes stuff when it brakes. The cheapest one will do.

That’s what we are losing, and I think you’re right, T2 is helping to hasten the process. Soon doctors will just become part of the asinine ‘gig economy’. You’ll be able call one up on your iPhone to help you with that case of gonorrhoea you acquired in Mexico. Then you’ll never see him/her again.

#276 X on 07.19.17 at 1:46 pm

All for tax fairness….will they be introducing a one size fits all personal income tax rate next year as well. LOL.

Some would argue the wealthy already pay more than their fair share.

#277 calgaryPhantom on 07.19.17 at 1:47 pm

If you give up pension, benefits and job security and accept the risk of running a business, sure. — Garth

————————————————————–
pension, job security are things of past. Today, full time jobs don’t offer any of these things.

In my opinion, in today’s job market, risk reward ratio is almost equal for a full timer and contractor. So i agree, all these incentives should be rolled back accordingly. This would bring these two employment streams more inline.

#278 ArcticOutback on 07.19.17 at 1:50 pm

#258 Mike on 07.19.17 at 12:08 pm – ‘All this is no justification for tax fraud for paying fake wages to spouse and kids who don’t actually work for you.’


Private Corporations have to pay tax yearly. Dr takes income from Corporation and is taxed on it. Wifes and Kids would receive dividends or wages for work; both are taxable.

The Majority of MDs are self-employed, with no benefits/pension. With MD’s hectic schedule it makes it hard to spouses to have steady jobs If left with only RRSPs to fund their retirements plus kids education, etc it makes things very difficult. Plus even with Corporations MD’s are high earners so most have lost their Universal Child Benefits and ability to income split; + they only get min RESP cont.

If spouse has to work more to add income it would mean Dr would work less in Private practice clinics and many would look for salaried work within hospitals, reducing access to care.

#279 Stan Broock on 07.19.17 at 2:12 pm

#263 Ponzius Pilatus on 07.19.17 at 12:32 pm

Again, people don’t see the big picture.
Outside contractors are considered parasites by regular employees. Most of them are providing services that could be done by regular employees at a lower cost.
They destroy moral and lower overall productivity.
I’ve been there, seen that.
To understand, you should study Organizational Behaviour.

————————————

Nonsense.

Federal government projects are driven by contractors only.

The reason to have the outside contractors doing the work is that the full time employee either can not do it/the work or do not have the stomach for potential failure /risking their easy life and benefits.

Comparing contractors with full timers in terms of money without taking into accounts benefit (drug plans, vacation, insurance, dental, pension) is an idiocy.

Stating that contractor is making ‘salary’ is an idiocy.

They run Businesses. Period.

Preferred tax treatment and ability to expend expenses is the only reason they exist as the pay in Canada is not that great/mostly sucks.

Hit them and they will (at least the most capable) move out immediately.

#280 TurnerNation on 07.19.17 at 2:12 pm

Our globalist leaders selling off our airport assets to their elite buddies. Tax slave colony Kanada.

But remember to PayYourFair share. Hard work brings freedom. Any proceeds won’t come to us:

http://www.cbc.ca/news/politics/airports-pwc-credit-suisse-morneau-sale-equity-lease-c-d-howe-cdev-finance-canada-1.4210703

#281 ALFRED E. NEUMAN on 07.19.17 at 2:13 pm

Get over it folks. Stop worrying about this stuff.

The feds need these additional tax revenues for our future payouts to victims of ‘Charter of Rights’ abuses.

Our brilliant PM interceded prior to many more millions being awarded to Khadr by due process in the courts.

We are so blessed to have this kind of thinking at the helm, holding the purse-strings of this great country.

So. I grew up in the era of corporal punishment being permitted in both the home and in the schools. As a regular victim of the strap and the slap, I too then, may be entitled to some free money? Wowza.

But hey JT, I’m not greedy. I’ll settle for just a few mill, okay?

#282 Stan Broock on 07.19.17 at 2:16 pm

BTW interesting divide an conquer strategy:
1 The cons work for the interest of the rich while robbing the poor and leaving something to the upper middle class.
2. The libs also work for the interest of the rich while robbing the upper middle class and leaving some peanuts for the poor.

At the end bunch of idiots clashing against each other thinking that 1 % -ers (or 220 k income) is rich.

#283 Kootenay Hippie on 07.19.17 at 2:26 pm

I have no problem with professional incorporation, but it should be available to all. As a salaried engineer, I can’t get my kids on the payroll. Yet my friend who is a radiologist at an hospital – no employees, no costly equipment to buy, a steady steam of clients – is incorporated. His stay-at-home wife is on his payroll. This is unfair. Either close the loophole or allow everyone to use it.

#284 meslippery on 07.19.17 at 2:34 pm

#255 n1tro
If you have not read #80 Keith I invite you to.
The part about no raise in wages in 32 years I can
confirm that.
I blame free trade. I believe Trump is what happens
when you keep beating the peasants.

#285 Smoking Man on 07.19.17 at 2:37 pm

This will only bring in 250 million a year, which is nothing. Trudeau wrote the Clinton foundation a check for that amount.

Sole purpose of the new regs is to appease the spoiled brat snot dripping millenial cry babys.

I already found s work around.

#286 Lee on 07.19.17 at 2:38 pm

#265 Ponzius Pilatus

Doctors aren’t typically wealthy until their late 40s. They usually leave school and finish residency around 30 years old. Then they have $400,000 of debt to pay off which takes a while. Better to be a government worker from 18 and retire at 53 with a pension paying you 70% of your highest yearly salary, all compliments of Ms. Wynne. Tell me who the fool is? Crap, if you do IT for the government at $130,000 a year that’s a $90,000 a year pension. If you do the math, takes until about 60 for the doctor to catch up to the government worker, when you include income opportunity cost. I can do the math for you, but just believe me, it’s quicker.

#287 Blacksheep on 07.19.17 at 2:58 pm

“Go Trudeau!! Fairness for middle class, or just allow me(a salaried employees) to give further ‘salaries’ to my spouse/kids a”nd expense my personal lunches, gas, leased cars, dinners, vacations(to attend conferences)…oh no…that won’t be fair, right.”

“Totally agree, I remember a small business owner I worked for paying his daughter a $100K to sweep floors while skilled machinists around her were paid far less.”
———————————————————-
As a Red seal Machinist for 26 years, with a daughter that has never been paid one cent by my corp, I gotta chime in.

Here is a great idea for all those snivelling about the unfairness of parties benefiting from being incorporated:

May I suggest all you unhappy employees liberate yourselves, risk the equity from your home by taking a LOC to start your own business. Work your ass off for many years and then maybe if your lucky and don’t fail and loose everything (GFC?) you’ll earn enough $’s to actually concern your self with, over paying family members or writing off, anything. I did exactly what I suggest above 11 years ago after being self employed for the previous 15.

Or, you know….just continue to bitch about the evil business owners and do nothing, because based on your comments, that is your nature.

#288 Howard on 07.19.17 at 3:17 pm

#274 InvestorsFriend on 07.19.17 at 1:41 pm
Tax Breaks are easy to give and hard to take a way

Example: TFSA $5000 was a gift (with the lost tax revenue obviously paid by others or borrowed) and so was the increase to $10,000. This blog and others howled to the moon when PART of that GIFT was taken away.

————————————-

Oh my goodness, heaven forbid we have a policy that actually benefits savers for once! Let’s instead extend more tax credits or interest-free loans (thanks Crooked Christy!) to indebted homebuyers whose eventual bailout will have to be paid for by said savers. That would be better, right “InvestorsFriend”?

#289 Blacksheep on 07.19.17 at 3:19 pm

And here’s a tip for wanna be small business owners:

Find yourself a hard assed CGA to keep your business on the straight and narrow to avoid the wrath of the CRA. She’s not cheap, but the piece of mind is priceless.

#290 Howard on 07.19.17 at 3:20 pm

#272 kumbaya on 07.19.17 at 1:38 pm
hard work is for losers. Let your socialist govt reward you for idleness. Come on down, grab a joint and gather on the mat of equality. your favorite eastern religion is welcome here, we are all the same. Welcome to Canada, how can we change for you?

——————————–

Don’t know you? Diversity is our strength!

Except diversity of though, of course. All of the colours of the rainbow joining hands under a Canadian umbrella of cultural marxism.

#291 Poorgirl on 07.19.17 at 3:21 pm

^^What #288 Blacksheep just said.

#292 Howard on 07.19.17 at 3:21 pm

“Except diversity of though, of course.”

Diversity of THOUGHT, that is.

Would kill for a temporary edit button here Garth, the type that expires 5 minutes after a comment is submitted.

#293 Blacksheep on 07.19.17 at 3:31 pm

Peace, not piece.

#294 MF on 07.19.17 at 3:35 pm

#287 Lee

I’d like to apply to that government job with a pension that i can retire with at 70% of my income at 52.

Please post the link.

Thanks

MF

#295 Realtors are scum on 07.19.17 at 3:39 pm

#262 Asterix1

Email OSFI and let them knowing if they won’t stress test mortgages you will borrow and speculate until you go bankrupt .

#296 S on 07.19.17 at 3:45 pm

#284 Kootenay Hippie on 07.19.17 at 2:26 pm

I have no problem with professional incorporation, but it should be available to all. As a salaried engineer, I can’t get my kids on the payroll. Yet my friend who is a radiologist at an hospital – no employees, no costly equipment to buy, a steady steam of clients – is incorporated. His stay-at-home wife is on his payroll. This is unfair. Either close the loophole or allow everyone to use it.

Professional corporation is an option for you. All you have to do is quit your job and start a consulting firm. Many engineers do that. Your radiologist friend most likely has no option of becoming the hospital’s employee. The MSP systems requires most physicians to be independent government contractors. This is a huge financial savings for the system as there is very little in terms of overtime compensation, no benefits, not to mention a retirement pension plan which most government employees get. Fact is most doctors will be fine; they’re a pretty adaptable lot. Just that you might not like the way they will adapt. See, the proposed taxation changes, which Mr. Turner assures us are a done deal, are the reverse of being paid overtime. Why would any professional work late into the night knowing that he has reached a point of diminishing returns by 3 pm? So either they raise their fees, which physicians cannot to, or they go to play with their kids.
Truth is that the current system has been exploiting doctors for a very long time. Below is a quote regarding truck driving regulations in Canada:
After a period of at least eight hours off-duty, a driver cannot drive more than 13 hours. After a period of at least eight hours off-duty, a driver cannot drive after having been on-duty for 14 hours. After a period of at least eight hours off-duty, a driver cannot drive after 16 hours has elapsed.Apr 3, 2017
Trucks Handbook – Ministry of Transportation
http://www.mto.gov.on.ca/english/trucks/handbook/section1-7-4.shtml

By comparison,I know physicians that routinely are compelled work 24 and even 30 hour shifts. Something to think about, no? Like I said, docs will sort this out and do what works for them. It is their clients that I worry about.

#297 Dogman01 on 07.19.17 at 3:51 pm

BTW interesting divide an conquer strategy:
1 The cons work for the interest of the rich while robbing the poor and leaving something to the upper middle class.
2. The libs also work for the interest of the rich while robbing the upper middle class and leaving some peanuts for the poor.

At the end bunch of idiots clashing against each other thinking that 1 % -ers (or 220 k income) is rich.

——————————————————–
So right.

They make sure we keep speaking about income not the obscene wealth held by just a few families. Not earned by merit usually simply by inheritance or monopoly.

Those with 11 of the 12 cookies will let the rest of us fight over the one cookie. “Watch that union guy, govt worker, Doctor – they are eating some of your cookie!” – and it works!

#298 Blacksheep on 07.19.17 at 3:55 pm

Lose, not loose, sheesh…

#299 Lee on 07.19.17 at 3:55 pm

#295 MF,

Every provincial government pension is structured that way, at a minimum. I can assure you I know lots of people in this position from police to normal government workers. Retiring at 53/54 with a full pension is normal in government, unless you start working later (like teachers), in which case just add 35 to the start date and that is the retirement date for a full pension. I do this calculation regularly. If you start at 25, retirement with full pension is at 60. Full pension is 70% of the average of the best five years (not including overtime).

#300 n1tro on 07.19.17 at 3:56 pm

Re: #285 meslippery on 07.19.17 at 2:34 pm
If you have not read #80 Keith I invite you to.
The part about no raise in wages in 32 years I can
confirm that.
I blame free trade. I believe Trump is what happens
when you keep beating the peasants.

I have read Keith’s comments and agree wages haven’t gone up relative to inflation. What annoys me is the blaming of external circumstances for your own situation that can be changed by you.

My family came over as immigrants and both my parents worked in factories at minimum wage even though they were educated while I was growing up. Not once did they whine and cry about how professionals used tax advantages to keep more money or that they were entitled to anything more.

Instead, they told me that what we are doing now is for you and your siblings to have the opportunity to not be poor like them. They said, what you make of the opportunity is on you.

I starting working at 15 and minimum wage was $4.25/hr. Instead of bitching for more so I can “live”, I just kept chasing after the next opportunity to make more money.

All the people who cheer on this “fairness” plan effectively shut the door to your own opportunity to becoming the 1%. Garth has outline many times how to legally avoid (not to be confused with “evade”) taxes and you keep more of your own money. How else would you become rich??

Only opportunities now for you whiners is to keep playing your group lotto or maybe hoping the government violates your charter of rights. Score!

#301 milleniallmoose on 07.19.17 at 4:11 pm

#219 Asterix1 on 07.19.17 at 8:25 am
#204 Howard on 07.19.17 at 3:00 am
#160 Vanrentor on 07.18.17 at 10:22 pm
An entertaining RFD thread about a guy who got bought at the GTA peak and cant get out.

http://forums.redflagdeals.com/sticky-situation-how-move-forward-2113394/
________________________

All the “financial advice” on this thread forgetting to let him know his rental income will be taxed at his marginal rate…. He’s going to have quite a surprise at tax time!

#302 Dups on 07.19.17 at 4:22 pm

Bill thinks that will gain more tax. Maybe, but i bet you some businesses will start operating with two sets of books due to these new greedy rules that he is imposing on so said Canadian rich class which by the way are way poorer than the rich in USofA.

#303 S on 07.19.17 at 4:24 pm

#301 n1tro on 07.19.17 at 3:56 pm

“All the people who cheer on this “fairness” plan effectively shut the door to your own opportunity to becoming the 1%.”

I come from similar background. And the above is the most astute comment I read in this post.

#304 Tazi Bnu on 07.19.17 at 4:42 pm

I wonder if anyone knows how much an obstetrician for doing a c-section. This kind of doctor also has to work in 24 hr shifts for emergencies if they want “privileges,” which is just the right to pay to use hospital equipment and nurses. That’s on top of running their own practice. Well have you guys found out a c-section cost, it’s $535.60, and if it’s twins or more it’s an additional $455.26 per child. It’s all here at:

http://www.health.gov.on.ca/en/pro/programs/ohip/sob/physserv/sob_master20160401.pdf

Doula’s charge $950 to $1750 per birth and they can’t do anything other than call 911.

#305 Damifino on 07.19.17 at 4:42 pm

#293 Howard

Would kill for a temporary edit button here Garth, the type that expires 5 minutes after a comment is submitted.
—————————–

Sorry Howard, but greaterfool.ca is about the daily posts, not the barrage of inane comments that follow. Any comment made is effectively lost to the world in less than 24 hours. Garth has to live with that and so do we. ‘Submit’ means just that. Don’t worry about it.

#306 Mark on 07.19.17 at 5:07 pm

“Stating that contractor is making ‘salary’ is an idiocy. “

If they’re on an “hourly” rate, and do all of their ‘contracting’ at the employer’s place of business, then its pretty hard to argue that they’re really ‘contractors’. The CRA has a pretty strict test for this, and at least in the IT world, if the question ever arose, most ‘contracting’ arrangements would fail the test of being a contractor versus an employee.

I do tend to agree with certain other posters, in that, if taxes rise on a given group of supply-constrained professionals (IT people definitely don’t fall into this group, BTW, with the massive glut of them that exists in Canada, but doctors might!), then their compensation will also likely rise accordingly. Hence, truly scarce individuals and professions really have nothing to worry about. The people who have plenty to worry about are the legions of accountants and lawyers who have created businesses leeching off of professionals giving them advice on things like “income sprinkling”. And its probably a good thing that the government is moving to level the playing field and remove opportunities from the more parasitic sectors of society.

#307 New record: $2,090 a month is average cost of one-bedroom rental in Vancouver on 07.19.17 at 5:09 pm

http://globalnews.ca/news/3609431/new-record-2090-a-month-is-average-cost-of-one-bedroom-rental-in-vancouver/

#308 Mark on 07.19.17 at 5:20 pm

“Well have you guys found out a c-section cost, it’s $535.60, and if it’s twins or more it’s an additional $455.26 per child.”

If you review the footnotes carefully in those sort of fee schedules, there’s all kinds of enhancements to those fees. An add-on for higher BMI. An add-on for any complications. Surcharges for after-hours call-in, Etc. Of course any follow-up after-care is billed separately, and there’s guaranteed to be at least 2-3 such appointments. And surgeons often “stack” procedures, for instance, elective sterilization during a C-section, which adds another few hundred bucks for a few minutes worth of work. So that $535.6 quickly becomes far more than that, for a quick 20-30 minutes worth of work.

Healthcare professionals certainly aren’t starving in Canada because of the fee structure. And while reimbursements look low compared to the US, there is almost never a problem, absent gross fraud, in getting paid in Canada. In the US, its quite a different story and the actual net income to the Dr. may not be even as attractive.

#309 InvestorsFriend on 07.19.17 at 5:29 pm

GreaterFool is ALSO about the comments

#306 Damifino on 07.19.17 at 4:42 pm said:
#293 Howard

Sorry Howard, but greaterfool.ca is about the daily posts, not the barrage of inane comments that follow. Any comment made is effectively lost to the world in less than 24 hours. Garth has to live with that and so do we. ‘Submit’ means just that. Don’t worry about it.

*******************************************
It’s not about the inane comments? Yes, we can see that you for example did not read the comments all the way down to number 293 and then feel compelled to respond.

Greaterfool is a highly successful blog. Yes, it is about the daily post from Garth and his two Saturday helpers.

But for many, part of the addiction is surely the comments. How many people visit multiple times per day?

The commenters work for free. (As does Garth for that matter).

But I agree most of the little typos are highly unimportant anyhow. In most cases the meaning is clear and that is what matters most.

The comments may have more entertainment value than educational value (mine aside of course) but they surely are a large part of this daily blog and its traffic. Try no comments for a month or even a week and see what happens to traffic could be interesting.

#310 SimplyPut7 on 07.19.17 at 5:49 pm

Over 300 comments, when was the last time that happened?

So Garth, do that many Doctors read your blog or is your blog full of people who hate their doctors?

And only 3 comments on NAFTA, seriously? That’s a bigger deal than a doctor having to find a new loophole to pay less taxes in the future.

#311 S on 07.19.17 at 6:17 pm

#309 Mark on 07.19.17 at 5:20 pm

Those “enhancements” are there for a good reason. Having to dig through several inches of adipose tissue before muscle and connective tissues can be reached is time consuming, hard work that usually requires an assist. And what you refer to as a few minutes of work often turns out to be a grueling night at the hospital after a busy day at the office, followed by a grueling day back at the office. These 36 hour shifts are not uncommon. And if you’re tired or sick after a night up just try to cancel a day of patients that have been waiting for months for their appointment. When are they going to be re-booked to when you’re booked solid for months in advance. In fact you’d be surprised how little OBGs are compensated for nine months of prenatal care, delivery and one post-natal visit.
And as far as compensation being guaranteed perhaps I could introduce you to some of my colleagues that wait for months on end to see the money. I know you are an expert at something. This certainly ain’t it.

#312 Pete from St. Cesaire on 07.19.17 at 6:32 pm

In the next budget you can count on (a) a test to ensure all shareholders are worthy of the money they are being paid
——————————————————–
Why don’t they just re-evaluate the salaries of everyone to determine if they deserved it in the first place (using a fair-share algorithm) and then claw it all back, with penalties. The end goal is the complete destruction of the country, so why not hurry things along a bit.

#313 After Communism on 07.19.17 at 6:50 pm

I am not a doctor and I like doctors, SimplyPut7. I commented because it is theft to decrease, reset, or set incomes by arbitrary rule changes by a powerful central authority.

#314 AGuyInVancouver on 07.19.17 at 7:17 pm

If people can leave the partisan rhetoric aside, I believe it would be safe to say the CRA had evidence of widespread abuse which is why they’re moving to tighten up this policy. As many others have pointed out, its rather unfair to offer such a loophole to once type of worker, but the others.

#315 X on 07.19.17 at 8:43 pm

re #284 – some of these rules are dictated by the professional regulatory body. Not necessarily by the gov’t.

What ever happened to work more, earn more, have more? The Liberal mantra seems to be, work more, earn more, have less. Not worth the effort to work more for more money if you are the guy who isn’t an MD or DDS.

Having said that, I don’t think a lot of health care professionals will head to the US over this. I do think that the cost of dental care and lawyer fees will increase to compensate, as those professions set their own fees. So much for ‘fairness’ to the average guy with fee increases….

#316 BoomerKid on 07.19.17 at 8:59 pm

Re: new corporation rules.

I don’t know what will happen with lawyers and accountants. My guess is they will just increase their rates and pass on at least part of the extra cost of taxes onto the consumer.

But for doctors who have their rates controlled by the government (and which the provincial governments are happily reducing), they don’t have that option. I think the response will be two-fold. For young specialists in their 30s who have had long and expensive training and cannot afford to stay, some will leave Canada and go to the US. For family physicians and for specialists (including many close to retirement) who can’t or don’t want to leave Canada for personal reasons, many will simple choose to work less.

Here’s some numbers for you assuming an average of 30% overhead and a 55.3% marginal tax rate. The Ontario government pays the following:

– Electrocardiogram (ECG) $4.45 –> take home = $1.39
– Chest x-ray $10.75 –> take home = $3.36
– Family doctor consult $77.20 –> take home = $24.16
– Family doctor follow-up appointment $38.35 –> take home = $11.99
– C-section $579.80 –> take home = $181.42
– Trauma surgery (open abdomen) $397.15 –> $124.27
– Brain surgery for bleed in the brain (subdural) $481.90 –> $150.79

Ask yourself, if you are a physician would you want to be up at 3 am or on a weekend making (net) $1.39 reading an ECG or $150.79 to perform brain surgery. Remember that every time you do anything you are responsible for that patient – you expose yourself to liability. You could miss a heart attack or your patient could not wake up from brain surgery. Or would you rather just want to sleep through the night, spend time with your spouse and kids in the evenings, and play golf on the weekends?

I think most doctors love their jobs and feel a duty to be there for their patients, but at some point they are also human and it just won’t be worth it.

#317 NotaDoctor on 07.20.17 at 1:25 pm

Excuse my complete lack of knowledge in politics, but doesn’t the corporation tax proposal still have to pass in parliament? Wouldn’t the opposition fight it (and they’d fight it tooth and nail) ? They can’t just invent this new law and implement it, that’s why we have more than one party.

#318 CRA auditor on 07.21.17 at 8:58 am

I’ve seen so much tax abuse from these professional corporation it’s about time they pay their fair share of taxes. Come on now, ….a 12 year old paid 15,000 to “water plants in the office on Saturday”?
Or an 8 year old paid $8,000 “to open envelopes and deposit money”?