‘Fantastically irresponsible’

The last time Canada brought in huge tax code changes they were researched and debated for six years. This time it’s 75 days. In the summer. When people are on holiday. Including all the MPs.

“The Liberal government’s rushed approach to push through these wide spread tax changes shows that they are either fantastically irresponsible or blatantly contemptuous towards Canadian entrepreneurs,” says Calgary accounting firm Achen Henderson. “The ‘comment’ period offered by the Liberals is one-way and, based on Mr. Morneau’s postings on his twitter feed, Canadians’ comments are being completely ignored.”

In fact when a Con MP razzed finance minister Bill Morneau for wanting to shove taxes on self-employed people as high as 73% while screwing doctors, here’s what he replied:

Does it sound like his mind’s made up? You bet. And the tax changes about to come into effect could constitute one of the biggest financial con jobs in our history. That’s not just the opinion of this pathetic blog. Most tax experts and accountants studying the proposed legislation have tossed their cookies. They cannot believe any sane government would launch a wholesale attack on the risk-taking entrepreneurs who create 50% of all jobs. What the heck is Justin thinking? Or, is he?

Blog dog Jake figures he’s about to be skewered by the proposals stripping spouses of the ability to share income of the businesses they share risk in, or to build up money in his corporation since he doesn’t have a pension.

“I left a stable job with one of Canada’s largest banks – I also left behind a defined benefit pension, a means of capitalizing a book of business when I wanted to retire (funded by the bank) and a future income of $400+k a year in salary/commissions. Do you know why I did it? Because I saw a business opportunity and I did the math. I decided to take a plunge, risk my own life savings, take on a bunch of debt, work for basically nothing for 5 years to only now start to climb out of the hole because I felt like the tax structure offered enough of an incentive to take the risk.

“If I succeeded, I would be able to employ people, be proud of having done something on my own and then enjoy the long tail benefits of getting to invest my hard earned money in a tax advantaged way – kind of like an RRSP for an employee who works hard in their job and saves their money. The only difference being, I left everything behind to put it all on the line to try to succeed whereas my co-workers have just muddled along, secure in their jobs, provided they closed enough business every month. Here’s the rub though, I could have also started the business I am involved in, in California – but I decided not to because the small business tax rate and the ability to invest my profits within the corporation were enough of a carrot to cause me to stay. So, here I am – what do I do now. Frankly, if you push this through, I’m packing my bags and won’t be looking back.”

The Liberal anti-small business proposals are couched in language of “tax fairness” and of people “paying their fair share”, suggesting doctors, plumbers, lawyers, massage therapists, carpenters and IT guys who earn their money through small incorporations are ripping everyone else off. The nation’s accountants, in a rare show of spunkiness, have been rising up to prove that wrong.

In fact, a self-employed electrician making less than $70,000 through his company working for various homeowners will pay more in tax under the proposals than an employee earning an identical amount, says Achen Henderson. Worse, the business guy has no heath or dental coverage, no paid sick days, no EI, no vacation, no company pension, no matched RRSP, plus endless risk. The spouse doing his books and living in a house mortgaged to start the company – who shares equal risk – is now cast as a money-sucking leach on the system. “Amidst the Liberal government’s commitment to promote gender equality, these policies seem to devalue the role of the stay-at-home contributor to a family business. The proposals insinuate that the stay-at-home half of an entrepreneurial couple is not as important, and so shouldn’t receive the same benefits, as the ‘working’ half.”

To remind you, the Trudeau/Morneau taxes will end the ability of entrepreneurs to share income with their spouses, despite their contribution, end the ability to create a retirement fund within a corporation for people without pensions and raise to 73% the tax paid to get retained earnings out of a small business. Medical people allowed to incorporate so provincial health plans can pay them less, benefiting all taxpayers, will be a special target.

Here’s a sampling of the outrage building among accounting firms:

Horizon Chartered Accountants, Vancouver:
“Some of these proposals appear to simply be an attack on entrepreneurs and professionals who have taken years out of their lives and very significant financial risks to start and develop businesses and to get educations to allow them to earn a better income.  However, they all start earning income later and they start saving for retirement much later.  They do not have pensions, they do not have government or other benefits and they do not get Employment Insurance.  These people carry an immense amount risk and stress that employees do not and yet the Liberal Government has the stated objective of taxing them on the same basis as employees.  This group of people employs almost 50% of the population in Canada.  Their retirement savings strategies (allowing them to catch up for years spent going to school and building their businesses up) are being attacked.”

Achen Henderson Accountants, Calgary:
“The Liberal government’s rushed approach to push through these wide spread tax changes shows that they are either fantastically irresponsible or blatantly contemptuous towards Canadian entrepreneurs.

“The Trudeau government is aggressively targeting Canadian entrepreneurs under the guise of propping up the ‘middle-class’ by raising taxes on ‘wealthy Canadians’. These changes affect all Canadian entrepreneurs who are profitable, not just the ‘wealthy’ ones. Mr. Morneau has ‘wealthy Canadians’ confused with all profitable, risk-taking Canadian entrepreneurs. Even more astounding is that Mr. Morneau and Justin Trudeau clearly do not believe that Canadian entrepreneurs, doctors, and farmers (including the ‘middle-class’ ones) are contributing their ‘fair-share’ to the Canadian economy. The Liberals have created villains (entrepreneurs, doctors, and farmers) whom naïve or uninformed voters can blame for a lack of funding at the federal level. Middle-class entrepreneurs are tax cheats! A very Canadian sentiment, indeed.

Yale & Partners Accountants, Toronto
“This proposal is not aimed at the wealthiest Canadians at all. If you have a holding company with $20 million or more in investments then these proposals do not affect you at all. If you are a small business trying to earn active business income of $200,000 or less with several employees then this proposal affects you profoundly. These proposals will affect whether businesses carry on, they will affect decisions that small business owners make, and they will affect how small businesses will behave.

“The tone of these proposals is completely misguided. Private corporations definitely pay their fair share of taxes. The implications that they do not, as implied by this document, is just not accurate. It also sends the wrong message to the world about Canada and misleads the general public about the true nature of the circumstances.

“The Finance department and the Federal Liberals are incorrectly casting small business owners as wealthy tax cheats. These proposals will cost jobs for people in small business, financial services and health care. They will also reduce the incentive for corporate charity. It is clear that these proposals send a message that this government is all about taxation and greed.”

If you are inclined, you can write Bill Morneau. Here’s his email: [email protected]. Say hi for me.

322 comments ↓

#1 Keith on 08.27.17 at 4:20 pm

“I left a stable job with one of Canada’s largest banks – I also left behind a defined benefit pension, a means of capitalizing a book of business when I wanted to retire (funded by the bank) and a future income of $400+k a year in salary/commissions. Do you know why I did it?

Because you have a psychological flaw that believes that your ability to define risk was sufficient to the task – it wasn’t. Ten percent of the population has been getting 90% + of the money from economic growth in Canada for decades, most people have earned the same money for decades in real terms. The government can’t tax the decreasing number of middle class salaried and working class wage earners any more because they are not making more money. They are taxing where the money has gone to for a long time, and the meaningful tax breaks. Gravy train is coming to a stop. Don’t worry, with the oversupply of labour working people won’t see a rise in pay anytime soon.

#2 Pete from St. Cesaire on 08.27.17 at 4:25 pm

“Amidst the Liberal government’s commitment to promote gender equality, these policies seem to devalue the role of the stay-at-home contributor to a family business. The proposals insinuate that the stay-at-home half of an entrepreneurial couple is not as important, and so shouldn’t receive the same benefits, as the ‘working’ half.”
—————————————————————
Very true. I’m sure Stats Can could show that most of these stay-at-home people are female; and now the government is trying to say that their contribution is invalid and they should not be allowed to be paid. Why aren’t the feminists up in arms over this. They are always complaining about the ‘imaginary’ pay gap, now the government wants to declare their workload (in these instances) to be of no monetary value at all, thus creating a very real pay gap for some.

#3 unbalanced on 08.27.17 at 4:27 pm

This country is cooked!!!!

#4 the other white meat on 08.27.17 at 4:30 pm

Thanks for link to let Morneau what I think Garth. I will be writing him to tell him I support this tax reform and I believe in fact it does not go far enough.

Your “70k electrician” example is a hilarious attempt at redirection. We all know the majority of people affected by these taxes earn far more money. Removing tax loopholes so they have to pay the same as any other working stiff is a great change.

#5 Stan Broock on 08.27.17 at 4:32 pm

As I have said countless times:

Following the rules when being ruled by idiots and incompetents is stupidity, it should be (and apparently is) a punishable crime.

Proves what a great decision it was to move out…
Cheers fellow Canadians!

#6 Pete from St. Cesaire on 08.27.17 at 4:34 pm

Don’t forget that these seemingly crazy moves by the government aren’t crazy at all. The government isn’t stupid, Governments are many things (evil, cruel, treasonous, ilegitimate, etc) but they’re never stupid. They have all the knowledge and workforce required to make the correct decisions. Every move governments make is part of a well thoughtout plan. So when you think that ‘the stupid government’ is going to cause entrepreneurs to leave the country (or whatever other evil ramification will follow on the heels of the new policy) you must understand that that is the desired end goal. It’s not a mistake nor is it vote-buying (all parties serve the same unseen master). Same thing with the housing bubble; don’t think for a minute that it came as a surprise to the government, they guided the whole thing all the way and continue to do so.

#7 Stan Broock on 08.27.17 at 4:38 pm

#4 the other white meat on 08.27.17 at 4:30 pm

There are no tax loopholes with private corporations. This new idiocy is policy of the big Businesses to crash the small one, it is not a liberal policy, but hey, you are stupid enough to believe it!

Tax loophole is the lack of capital gains tax on principle residences.

If you have any moral and decency you will tell your doctor what you think about the Bill M tax reform and then see what happens.

#8 Stan Broock on 08.27.17 at 4:40 pm

#6 Pete from St. Cesaire on 08.27.17 at 4:34 pm

exactly.

#9 A Dollar is a Dollar is a Dollar on 08.27.17 at 4:44 pm

Here’s my email to Bill:

Finally!

Keep up the good work :)

Wow. The country may be cooked. — Garth

#10 Damifino on 08.27.17 at 4:55 pm

For Justin has promises to keep
And miles to go before defeat

(my apologies to Robert Frost)

#11 Linda on 08.27.17 at 4:55 pm

The ‘wealth tax’ as explained by this very blog correctly pointed out that taxing the 1% while giving tax cuts to the middle class would result in lower tax revenues overall, as the number of people in the 1% bracket were greatly outnumbered by those who earned less. So this attack on entrepreneurs/self employed is simply the governments response to the reality that their expectation of tax revenues was far less than the reality.

So the plan appears to be 1) demonize those entrepreneurs/self-employed as ‘tax evaders who are stealing the very bread from your children’s lips’ to the rest of the taxpaying citizens in order to 2) enact new tax laws that will (they hope) make up the gap in tax revenues so they can 3) claim they ‘saved’ the citizens from the evil of not having the funds to pay for all those services that they are expected to provide.

As for the smug who trumpet how ‘they’ have been given unfair advantages & how this should have been done long ago, I trust that they will remember their glee when those increased taxes are applied to their own wallets. Which they will be, guaranteed – it is just a matter of when.

#12 Yanniel on 08.27.17 at 4:58 pm

IT guy here (wife in IT too). If Trump does not blow up NAFTA, we are heading south on a TN visa. I rather chop off my arm, than give my money to this government and its followers.

#13 rknusa on 08.27.17 at 5:00 pm

some of these so called entrepenuers

i know an engineer who created a corporation

has had the same sole client for 25 years so is essentially a defacto employee

client (i.e. employer) dodges payroll taxes, engineer dodges payroll taxes, writes off his truck and many other so called business expenses, shelters his defacto wages in his corporation and only takes out what he needs at a greatly reduced tax rate

where is the risk

and this same engineer whines about so called “cash for life” public empoyees and their pensions and that he pays too much in taxes

oh yeah and he lives in his parents basement and he is 60 years old

Not credible. Any contractor with a sole client is taxed as an employee. — Garth

#14 Stan Broock on 08.27.17 at 5:01 pm

No need to attach the poor schmuck.

He is just doing his job as told by his real employers (not you Mr/Mrs/Ms/Zeh,…. Canadian voter) at BIS.

He is just the servant, loyal to his employers who delivers the message. A little too eager to prove his loyalty, but that will work too.

Of course his message disguised as crusade for the middle class is actually attack on the middle class.

Nothing personal. Just Business. Time to move on.

#15 Where is that? on 08.27.17 at 5:07 pm

“$400+k a year in salary/commissions.”

Where do I sign up for that?

#16 rknusa on 08.27.17 at 5:08 pm

re: #13 Not credible. Any contractor with a sole client is taxed as an employee. — Garth

It is fact, and CRA’s lax enforcement over the years has likely brought these latest reforms

same as for real estate transactions

#17 Dan.t on 08.27.17 at 5:10 pm

What’s wrong? Just buy a house and live happily ever after. It will go up 100% every 3 years, so borrow, borrow, don’t work, just sell the first house for 400k tax free and then rinse and repeat. That is the Canada economy.

Who voted in the liberals? Right, The people. Justin Trudeau!!! YEAH. He likes weed and looks groovy, and is sooo, well liberal! and look, we all have cool houses to sell and make wicked equity (is that a thing?)…sound like Canada in a nut shell.

Every year I go back to Canada it seems to get stranger and stranger. Canadian mentality is odd. The people left Christy Clark in power for 16 years and now, you better have 3 kidney because you need to sell 2 of them to afford to live in BC (Realistically, unless Bank of Mom gives you 200k and the nice bank lady approves you for 600k).

Why are the boomers getting upset. Risk doesn’t equal reward anymore. Boomer just had to live the Canadian dream, buy a home, rising wages, make all the rules, now everything changes…deal with it. How is that working out for the younger generations? Oh, good they get to buy your tear down for 980k while making a cool 47k gross income! Awesome!

Obviously the up and coming generations and especially the millennial are dumb or care more about transgender toilets and fairy dust than how an economy works.

Tax the s##t out of everyone. I m all for it. Seems fair. There is how many more years of liberal trust fund babies making the rules? You really have that much faith in the government? Why do you think crypto currencies are going nuts? Still, one thing is for sure, in the end, take it and learn to love it!

If entrepreneurs and those who invest after tax income in the market get taxed to oblivion (taxes on investing is probably coming soon too), fine, they can just access their trust funds and chill for a while.

The maybe put the crap that is going on down on paper so when it comes time to vote, you vote differently, but fact is, politicians know we have 4 month memories….and no one like to ruffle the feathers in Canada.

If this is too political…delete away Garth.

Sad when taking risk is discouraged and the best jobs and most sought after jobs are government jobs (have times changed? I think so!) and brainwashed Canada is only worried about real estate… but I m sure things will work out for the best.

Squash all incentive to work and control the people.

#18 D Apostrophe on 08.27.17 at 5:10 pm

This is what happens when they realize Canada is in over it’s head. And it’s sad cos when I got back to Toronto I noticed there is a developing start up community in Toronto. A good one actually and lean so they need all the help they can get as there isn’t anywhere near the same capital available. And now.. after my wealthy developer and hedge fund manager neighbors have been getting pass after pass to develop a 20th Century economy in the 21st Century.. they’re gonna fleece the future prime movers of the Canadian economy. One thing that was obvious when I got back to Canada is it’s about 5 years behind California at least.. now expect that number to go way up. Couldn’t have picked a worse time. Toronto is gonna feel some major pain soon as the housing industry crashes hard. What will fill it’s place?

#19 Penny Henny on 08.27.17 at 5:13 pm

“I left a stable job with one of Canada’s largest banks – I also left behind a defined benefit pension, a means of capitalizing a book of business when I wanted to retire (funded by the bank) and a future income of $400+k a year in salary/commissions. Do you know why I did it? Because I saw a business opportunity and I did the math.-Blog Dog Jake

sounds like he was being greedy. IMHO

#20 Average Joe on 08.27.17 at 5:13 pm

The last time this was the topic du jour, there were a large number of posts with what I will call What’s In It For Me (WIIFM) bias. Everyone suffers from this type of bias, including and especially (full disclosure) me.

We instinctively compare any proposed changes from the status quo with a full-on WIIFM filter. Here’s the problem with that. Being a part of an organized society is not all about ME. Sometimes, WE have to accept that change will have an adverse impact on ME.

The old adage about death and taxes being the only two unavoidable things in life is not accurate. Only death is truly unavoidable, taxes are very avoidable. And the point of this change is exactly that.

Because of my nationality and chosen profession, I can choose to live and work in many countries around the globe. I choose Canada.

#21 Harold on 08.27.17 at 5:14 pm

I’ll write to Morneau and ask him why it took so long to implement these changes. Ontario gets blackmailed every year by Docs who threaten to leave for the US if they don’t get huge increases in pay, and now Canada gets the same threat if it takes away the loopholes that allow Docs to pay little or no taxes.

‘Doctors pay no taxes’. Stunning misinformation. It scary people like you get to vote. — Garth

#22 Penny Henny on 08.27.17 at 5:16 pm

I also left behind a defined benefit pension, a means of capitalizing a book of business when I wanted to retire (funded by the bank) and a future income of $400+k a year in salary/commissions.-Jake

I left everything behind to put it all on the line to try to succeed whereas my co-workers have just muddled along-Jake, again

muddled along for 400K per year. That is so sad.

#23 Dan.t on 08.27.17 at 5:16 pm

#6 Pete from St. Cesaire

I agree…they know what they want for you, me and everyone else. Just read between the lines and try to game the system… I guess that is the only chance you have.

#24 EmpCod on 08.27.17 at 5:20 pm

I don’t see why a stay-at-home mom should be allowed to income-split with her husband if he’s an incorporated doctor but not if he’s employed. Trudeau ditched income splitting for families, it’s just fair to apply the principle across the board.

#25 AndyTN on 08.27.17 at 5:28 pm

About time. Canada has long had too many doctors, entrepreneurs and families, and far too little a tax burden! I’m glad Mr Mourneau has stepped in to correct these egregious imbalances.

I’m kidding of course.

Like some other commenters here, I am living and working on a TN in the US. It’s stunning to see how tone-deaf the government up north is, directly trying to screw anybody with an ounce of motivation or risk-appetite. Not only are these targets critical to the Canadian economy, they’re also the most capable of packing up and leaving when the media and government decide to villify them. I, for example, intend not to make another dime in Canada for the rest of my life. If the Canadian government has decided I’m an evil rich man deserving of theft I’m obviously not going to give them another dime.

#26 AB Boxster on 08.27.17 at 5:28 pm

Just loving it.

I mean really, Garth, what did you really expect?

His old man was pretty much a communist.
Almost broke this country up with his divisive policies.
Srewed the west over and smiled as he did it.

T2 professed his admiration of Chinese dictatorships and his great affection for daddy Castro.
Again, screwing the west over and smiles as he does it.

Now he’s screwing the ‘rich’.
The doctors and entrepreneurs. (not taking on the Hockey players though)

What the hell were you people thinking when you voted for these guys?
Was having legal pot really worth it?

Trump may not be a conventional politician, but at least he knows that the government’s role is to support the economy, grow jobs,
reduce regulation, taxes, and make government accountble.
That he cares more about his own country than he does about the rest of the world is a bonus.

Give me hundred Trumps over the incompetent morons in the Canadian government today. Feminists that they are.

I can only hope that once Alberta elects a conservative govt and Ontario as well, that this country may replace the idiots on Ottawa.

If I were younger and needed to work I would be out of this place in a second. Today labor and capital are easily mobile, and the choice between communist Canada and capitalist USA is pretty simple.

#27 FLHTK on 08.27.17 at 5:33 pm

Wow 400+k a year, where do I sign up!!! That’s unreal. You must be getting that from your TFSA.
And this country is so f’ed….talk about as* backwards thinking. Let’s tax the companies that employ people even more….maybe they’ll expand!! Haha…..if I was a Dr. If be looking to the good ‘ol US of A…..which alot of them probably will be now which won’t help the shortage, I can’t believe these political leaders actually think they are doing the right thing for Canadians.

#28 Paul on 08.27.17 at 5:37 pm

Ladies, you came a long way baby.

#29 InvestorsFriend on 08.27.17 at 5:38 pm

All Tax Increases are Bad?

Really, are there NONE of the tax changes here that should be supported? Like the one where some businesses turn income into capital gains? Or income sprinkling where a professional’s income is artificially turned into dividends for family members?

Would it make sense to acknowledge there have been some abuses and try to stop those?

Or are ALL tax increases, including closing loopholes always bad?

#30 DogsLivesAreTooShort on 08.27.17 at 5:39 pm

Giving up.

Closing the company, going to work for the government.
Check my soul in at the door each day.
It’s only basically a half-day anyway. 7 hours, no risk, heaps of paid leave and sick leave. probably works out to less than 5 hours a day if averaged out.

Money usually goes where it’s best treated.
Wake-up calls not getting through to the profligate crony-club in charge. Is the switchboard jammed permanently?

And supposedly Trump is reckless and clueless?

#31 Kyle Butler on 08.27.17 at 5:40 pm

I certainly don’t always agree with the economic policy of the Liberals, but Bill Morneau is entirely correct here. There are better ways to incentivize small business than to permit a wholesale tax subsidy to anyone who incorporates.

Your blog dog Jake who apparently thought he could use a personal corporation to generate well in excess of $400,000/year in tax-sheltered income is a good example of why such policies tend to favour the wealthy at the expense of middle income earners. Why on earth should hard-working Canadians earning less than a quarter of his income pay higher taxes so that his wife can be subsidized to chauffeur their kids between prep school and their Oakville mansion? Or perhaps to subsidize a fancy porsche or luxury condo for his university-age kids?

As I see it, your sole justifications are: (1) a race-to-the-bottom threat about tax rates in American jurisdictions, who have a track-record of undercutting us regardless of where we set our rates, and (2) some backwards claptrap about gender equality, when in reality such policies actually disempower women by incentivizing them to stay at home and become economically dependent homemakers. These are cynical justifications for differential tax treatment that no doubt yields highly unfair results for most taxpayers, and I’m not about to get behind them.

#32 InvestorsFriend on 08.27.17 at 5:40 pm

Good Post from Average Joe

#20 Average Joe on 08.27.17 at 5:13 pm said:

The last time this was the topic du jour, there were a large number of posts with what I will call What’s In It For Me (WIIFM) bias. Everyone suffers from this type of bias, including and especially (full disclosure) me.

******************
I agree with your comment.

#33 Cherry Picker on 08.27.17 at 5:40 pm

The blog dogs conviently ignore the growing wealth gap. The rich are getting far richer and the middle class is shrinking. I’m all for a wealth tax to reduce income and corporate taxes for all, but that seems to be a non- starter with old-style Canadians, so this is what you get. Suck it up or start addressing the increasing weath gap, and increasing number of working poor as the rich get exponentially richer.

#34 Retired in Kelowna on 08.27.17 at 5:45 pm

I already wrote to our local MP regarding these proposed changes. He forwarded my letter to Mr. Morneau. I got a nice letter back from one of Morneau’s flunkies telling me all about the wonderful things the Liberals are doing for the middle class. NO answers to any of the questions I asked.
You graciously used my example Garth in one of your past posts to which you and I both received a bunch of flack in the comment section.
So what is the point? I guess the message from the Govt is “Don’t aspire, don’t work hard, don’t create jobs with your efforts” because any profits you may make will be take by us the Socialist Hordes! I’m giving up hope.
Trudeau and Morneau – The Canadian version of Dumb and Dumber.

#35 Denise#1 on 08.27.17 at 5:49 pm

I’m ashamed to admit it, but I voted for Trudeau, mainly because I was sick of the scientist muzzling Harper. I have not been crazy about Trudeau so far, and his and Morneau’s unwarranted attack on small CCPC’s is the straw that broke the camel’s back. I have family members who started up their own small business almost a decade ago. They employ about 5 people. These family members have worked super hard for many years and still are. They’re finally making good headway now and NOW elitist Trudeau and elitist Morneau decide to screw the middle class they say they’re trying to help. Trudeau and Morneau don’t seem to realize that small CCPC’s are not the same as large corporations. Trudeau and Morneau don’t have any idea what the real world is like and if thrown into it, they would not survive. I will not be voting for Trudeau and the Liberals ever again. I would think almost 100% of small CCPC’s and their family members won’t be voting for them either.

#36 Rainclouds on 08.27.17 at 5:52 pm

Send billy bob an email a while ago regarding this idiocy, never heard back, not that I expected to…..Maybe I shouldn’t have signed it Smoking Man?

Waddya expect from limousine socialists?
Avi Lewis and Naomi Klein setting policy for Little Potato and Morneau’s Sr silver spoon spawn? It would appear so……

#37 CONservatives are elite scum on 08.27.17 at 5:56 pm

The Liberals are no better then the Corporate Conservatives. This tax plan benefits the big greedy evil corporate companies while middle class companies will be destoried. Liberals = CONservative

#38 Christopher Mewhort, EA on 08.27.17 at 6:02 pm

I have written to Mr. Morneau explaining that I am a tax accountant and that I fully support his proposals.

You are a accountant in the U.S. — Garth

#39 I'm stupid on 08.27.17 at 6:02 pm

Future income of $400k is like counting your chickens before they hatch. He left a job, only his current income counts. Some aspects of the changes have merit others do not. Being able to pay your children shouldn’t be allowed. Splitting income with your wife should be. The tax code should consider a married couple as a unit not two individuals. Tax deductions on vehicles should be changed as well. Only the minimum price of a vehicle class should be allowed to be deducted. In certain circumstances it should not be allowed. For example, a dentist with a lease payment of 30k a year should be disqualified but a plumber with a van should be allowed. One needs the vehicle to conduct business the other does not.

What we’re dealing with now is class warfare and a bunch of politicians that want to get re-elected.

#40 FOUR FINGERS WATSON on 08.27.17 at 6:06 pm

Turdo does’t care about you peasants pissing and moaning. He’s got the hair, the tats, the Name, the trust fund, and the MP pension. He’s made in the shade suckah ! Stop your snivelling and whining, your betters know what’s best for you. He gonna be around for a looong time. Get reelected with a huge majority. You’ll see. Dummy.

#41 Smoking Man on 08.27.17 at 6:09 pm

Just sent this to Bill

Dear Bill

I am writing to voice my displeasure about the up coming, Dr Tax as the street calls it now.

Being the only person in this galaxy that has a PhD in Herdonomics. I can assure you the fall out from this communistic confiscation you and cute socks propose will come back and bite you hard. Damn, forgot selfy boy has none. Love his vocabulary though, “Ah, Umm, Oh, Ah.”

No, I’m not trying to be disrespectful but trying to give you a heads up on what will result from a George Soros wet dream, a stadium full of millennials “Yeah, Let’s get the man!!!!!” will be like.

Bill think this through, the few votes you get on this measure ain’t going to be worth it. Entupenurs use to working 100 hour weeks for little or no money at all. They are the most creative creatures on this planet. They are not used to losing and 100% of the time they find work arounds to problems. They are not like low energy civil servants with defined pension plans that go with the flow.

You going to piss off the biggest job creators and most lethal driving force of this economy. Do you think no collateral damage is going to happen. You have marginalized every stay at home mom, “Sorry bitch get a job and let our schools turn you little boys into little girls” Well that’s the Soros plan.

It’s unfortunate you have such a low IQ or possibly a mental disorder that can’t see the future, your grand kids will suffer dearly under the demented vision of George Soros who has Gerold Butts under total mind control.

I know this letter will not make you change your mind. In fact you will probably be more vicious in your resolve. The true fangs of communism on display for everyone to see and your teacher mind fk millennials will love you for it.

You leave me no other choice. I’m taking all the loot in my company, proceeds from selling my house in April, all my wealth I have saved for retirement.

You are forcing me to go on a savage casino road trip, I need to triple up in order to avoid eating craft dinner for breakfast, lunch and dinner. Odds are not in my favor. Wish me luck, if I fail I’ll just have to go personally bankrupt hand in my disability form to CRA something I wasn’t willing to do before you and no nuts decided to take 73% of the money I earned working 100 hours a week for 20 years.

Dr Smoking Man
Phd Herdonomics

#42 Randy on 08.27.17 at 6:11 pm

Anybody who has a high-paying job with a Canadian Bank or a Provincial/Federal Government with a Defined-Benefit Pension Plan (Gold-Plated) along with Benefits would have to be an IDIOT to quit and become an Entrepreneur. Canada is run by Marxists and they HATE Entrepreneurs. IMHO.

#43 Perspective on 08.27.17 at 6:12 pm

Hey this Vancouver house…

https://www.zolo.ca/vancouver-real-estate/1126-wolfe-avenue

will likely be bought by a doctor, plumber, lawyer, massage therapist, carpenter or an IT guy, or someone who earns their money through small incorporation. This outrageous, clearly these folks are not paying their fair share of tax…go get’em Bill.

#44 millmech on 08.27.17 at 6:12 pm

I can not wait for this to pass because the next one on the hit list will be those evil, money grubbing homeowners keeping all that untaxed “income” in their homes.
Once they realize how easily people will roll over and take it they will have no problem not only taxing capital gains on sales but look forward to a home equity tax like a property tax.
This will be a nice yearly stipend to the federal government to help pay for all their pet projects.
Like I have always said stealth wealth is best, stay under the radar!

#45 AK on 08.27.17 at 6:16 pm

“Does it sound like his mind’s made up? You bet. And the tax changes about to come into effect could constitute one of the biggest financial con jobs in our history.”
——————————————————————-
That’s what happens when Libtards are voted in power. Hopefully, they will be voted out in 2019.

#46 Mandria on 08.27.17 at 6:17 pm

Garth I have to say I mostly agree with you on this one (this as a dirty public servant and union activist to boot) there are many legitimate small businesses that do take risks and should be rewarded by the tax code. I got a start in my career in these places, have worked hard to help them see success, and want to see that prosperity continue. That being said I’ve also witnessed the grey zone “cheat” side and want to see that shut down, they are an insult to real business owners. I’ve seen someone own a single rental property and report income in their kid’s names when there was no actual work done (and without the kid’s informed consent).

This needs to stop.

Finding any “business” reason to use a CCPC to “income sprinkle” is a real problem that needs to be shut down but Morneau is throwing out the baby with the bath water. I’m sure our elected leaders and the CRA can find a way to whack the cheats while leaving the legit small businesses intact we all just need to admit that a dichotomy exists there and the free loaders/loophole exploiters are the problem and not the entire scheme.

There is a problem, but don’t screw the legit business owners with the fake-board-minutes-through-an-expensive-law-firm-opportunistic-cheats.

#47 Randy on 08.27.17 at 6:18 pm

I sent my email to Bill Morneau along with a picture of me standing beside my cardboard cut-out of Justin Trudeau. I hope that Bill doesn’t think that I’m a Refugee ?

#48 millmech on 08.27.17 at 6:20 pm

I notice that the taxpayer is maxed out in a lot of statements to the media by government spokespersons but homeowners seem to be getting the death by a thousand cuts a .5% tax here, a surcharge there, a special onetime levy that never goes away.

#49 Ace Goodheart on 08.27.17 at 6:36 pm

I guess the question to ask is at what point did taxation become punishment for doing well?

If you are say for example a police officer earning 100K per year, on a 20 year work plan with a defined benefit pension, and you started work at age 21 after your gap years and a year in a college prep course, you will retire in your 40s. You have a tax sheltered pension, funded by other people’s taxes, that will pay you for the rest of your life.

So we encourage people to become police officers. Very little education needed, can do it right out of high school, start young. Just take a test really.

But what if we need doctors?

Four year degree and then medical school. Graduate hundreds of thousands of dollars in debt. Then residency, then build up a private practice. Have children in your late 30s. Similar situation with lawyers. You have to work into your 50s or 60s because you start earning so late. Most lawyers have over 7 years of schooling by the time they are called to the bar. Doctors are similar. Then it takes years to build up a business.

If there is no means of saving for retirement and your earnings are vacuumed up as they are earned, what is the point?

Might as well just take the civil service exams out of high school, put your 20 years in and then ride off into the sunset, defined benefit style, at age 40. Why in the world would anyone put in the work to accomplish something more difficult?

It doesn’t make sense anymore.

#50 Hawk on 08.27.17 at 6:39 pm

I have $75K in my retained earnings. Should I take it out this year? Will I be able to avoid the 73% rate if its taken out in 2017 and what is the current rate?

Anyone knowledgeable please advise.

Thanks,

H

#51 Blobby on 08.27.17 at 6:40 pm

I guess I’ll go back to being a soul proprietor.. at least I’ll be giving my accountant less money…

#52 Kallamazoo on 08.27.17 at 6:46 pm

#13 and Garth:

some of these so called entrepenuers

i know an engineer who created a corporation

has had the same sole client for 25 years so is essentially a defacto employee

client (i.e. employer) dodges payroll taxes, engineer dodges payroll taxes, writes off his truck and many other so called business expenses, shelters his defacto wages in his corporation and only takes out what he needs at a greatly reduced tax rate

where is the risk

and this same engineer whines about so called “cash for life” public empoyees and their pensions and that he pays too much in taxes

oh yeah and he lives in his parents basement and he is 60 years old

Not credible. Any contractor with a sole client is taxed as an employee. — Garth

Uh, maybe Garth. But I know several people who carefully keep two or three clients, two of which they are paid peanuts by, so they can benefit in all the ways this gentleman suggested. Indeed, one of them derives 90% of his $200K+ a year salary from two companies, and actually gets a rebate on his 13% tax rate from his incorporated firm because he charges his beer and skittles to his company, whether it’s for business or no. meanwhile my wife pays 40% of her 100K salary in tax and you are telling me it’s OK cos she’s a wage slave, where the other guy is a hell-for-leather, damn-the-torpedoes entrepreneur? Get over yourself.

Nobody makes a salary of $200K and pays tax of 13%. Get over yourself. — Garth

#53 Asterix1 on 08.27.17 at 6:49 pm

What would you do if…

You run a federally incorporated business with zero employees (just yourself). You sell services to Ontario and Québec. You make around 85K a year after taxes in salary.

With these new gov’t changes, is it worth switching the company (Inc.) to a sole-proprietorship?

PS: Will sole-proprietorship reduce paperwork per year? (Filling in Quebec, Ontario, CRA etc..)

#54 Smoking Man on 08.27.17 at 6:50 pm

#50 Hawk on 08.27.17 at 6:39 pm
I have $75K in my retained earnings. Should I take it out this year? Will I be able to avoid the 73% rate if its taken out in 2017 and what is the current rate?

Anyone knowledgeable please advise.

Thanks,

H

Take it and run

#55 Stone on 08.27.17 at 6:51 pm

There are some small business owners who honestly deduct expenses related to their business. There are also many who deduct things that have nothing to do with their business. The example given of the dentist deducting a car lease versus a plumber deducting their van is valid. The dentist’s car lease has nothing to with their business. I review financial statements to finance businesses and I often have to ask the business owner and accountant to explain themselves in regards to quirky expenses. Most often, the response I get is “Oops, that was an error. It shouldn’t have been included.” That happens too often. Same for income sprinkling. The wife is the office manager. Every time you visit the business, the office manager is someone else. Net income at the bottom of the income statement shows minimal. Same for Management Wages. And yet, they have multi-million dollar homes, drive latest high end vehicles and have every toy possible. Shareholder loan increases show year over year in the hundreds of thousands of dollars.

Sorry. I can’t empathize here. The business owners who are honest about their revenues and expenses, income sprinkling to family members who legitimately work at the company have nothing to concern themselves with with these tax changes. For the rest, A free ride in a fancy car can only last so long.

For those who indicate they will move to the US if this happens show themselves for the opportunists they are. The US gouvernment constantly has to raise their debt ceiling or go into default. That will eventually come to an end too. Don’t think moving to the US will solve your dilema.

And yes, I ran 2 businesses myself. I never tried to pass an illegitimate expense on my income statement. CRA auditted me once. It was a thoroughly unpleasant and degrading experience even though everything was in order. We all need to pay our fair share. I just wish our gouvernment didn’t squander so much of our tax dollars though.

#56 Viorelli on 08.27.17 at 6:54 pm

The economy has stalled, Fiat money is rapidly devaluating, a million dollars means nothing now days. The production had shifted to third world, tfw and robotics will pick up the crumbs. Many are in deep debt and living paycheck to paycheck. Khadr and other isil members must be compensated. Healthcare quality and waiting lists are completely overloaded. Borders are being overrun and our government is very concerned about transgender rights and Canadian forces must protect Latvia instead of our own borders. No wonder the well to do are running away. Putin and Mr. Ji Xipin are laughing their throats off. It’s all a circus show.

#57 OttawaMike on 08.27.17 at 6:54 pm

I’m confused here:
So the govt. should help the entrepreneur during the lean start up years by giving them tax incentives?

And the govt. should help the entrepreneur during the successful years when he is making a profit by giving him tax incentives?

Sounds like you want it both ways?

#58 2 Cents Canadian on 08.27.17 at 6:56 pm

Morneau ….. ” there’s lots of good reason to start a business … avoiding personal tax shouldn’t be one of them”
Actually it’s nearly your only choice now as this government has created a business environment that has big business (and your potential employer) staying away in droves. If you want to make more than $15/hr. and have a smidgen of hope to be in your control of your financial future, starting your own business is still your best shot. Then if by a combination of skill, smarts, risk, hard work and just plain dumb luck you manage to succeed ….. they will keep tweeking the formulas so your standard of living is just a notch above the dog f’ers and whiners.
The ambitious don’t know why are the way they are and why they try so hard to succeed …… just as the dog F’ers and whiners don’t know why they are the way they are and try to drag everyone and everything down to their lazy Whitney ass level. But If you don’t allow a certain % of ambitious make a lot of money starting and running their business’s ……. who is going to employ the dog F’ers? We’re running out of people and things to tax!

#59 Mike in Toronto on 08.27.17 at 7:04 pm

#35 Denise#1

It was a terrible election. Harper’s anti-science quasi “moral values” MP puppets, Trudeau, who’s main qualification was growing up at 24 Sussex, and then… Mulcair.

I can forgive those who voted Trudeau, but nobody should have expected good things.

I voted NDP, but my local candidate was decent, which is rare for those guys.

#60 ww1 on 08.27.17 at 7:04 pm

#49 Ace Goodheart on 08.27.17 at 6:36 pm

But what if we need doctors?

Four year degree and then medical school. Graduate hundreds of thousands of dollars in debt. Then residency, then build up a private practice. Have children in your late 30s. Similar situation with lawyers. You have to work into your 50s or 60s because you start earning so late. Most lawyers have over 7 years of schooling by the time they are called to the bar. Doctors are similar. Then it takes years to build up a business.

The problem with all these worries about doctors is that there is absolutely no shortage of people trying to get into Canadian medical schools. And many of the applicants turned away are highly qualified and miss the cut by a very small margin. Also, don’t forget that a four year degree and medical school is heavily subsidized by the taxpayers.

The real concern here should be the effect on actual entrepreneurs – not elite state sponsored and supported professionals. Of course many of those entrepreneurs fail to make any real money despite putting their whole lives into it.

Ever hear about a bankrupt doctor(outside of malpractice or a bad divorce)?

#61 Brian on 08.27.17 at 7:08 pm

Hmmm…kinda reminds me of when HARPO pledged to “protect retirees” by not changing the tax rules governing Income Trusts.

Then he got elected and BAM…the income trust BETRAYAL

Many retirees never recovered.

Not to mention the gazebos, and the $90K “not a bribe” and so much more.

Many will never vote Conservative again.

Rightly so.

#62 jess on 08.27.17 at 7:09 pm

clampdown here as well as over there
https://www.ft.com/content/3ef3cb0a-5ffa-11e7-8814-0ac7eb84e5f1

http://www.bbc.com/news/business-37101020
“Richard Murphy, a chartered accountant and academic at City University, told the BBC it was unlikely that cases would come to court, but that the threat of fines would act as an “amazing deterrent” to advisers which would prevent them offering advice on tax avoidance.

He said this was partly because it could put at risk their ability to get professional indemnity insurance, which they need to continue their work.

“Lawyers and accountants will not take the risk of selling these schemes,” he said. “There’s a risk of a 100% fine so they’ll think they can’t afford to do it. Every honest accountant will be jumping for joy this morning that those who have been selling these schemes will be put out of practice.”

#63 dr. talc on 08.27.17 at 7:10 pm

Divide and conquer, by M
wage slaves vs entrepreneurs
‘Johnny Paycheck’ please vent your anger in the right direction, at the system and it’s owners.

http://hoaxbusterscall.blogspot.ca/2017/08/george-carlin-divide-and-conquer-in.html

#64 A Dollar is a Dollar is a Dollar on 08.27.17 at 7:12 pm

We need to go in this direction. Look at the world, look at Canada today.

Within 5 years, 10 tops, we will finally begin to see the reversal of the enormous wealth divide that began with all that idiotic Reagan trickle down bullsh*t in the 1980s.

Ordinary people will do better, and be more empowered to take risks and create businesses.

I am an Eisenhower Republican, by the way. Ike knew that higher taxes on the 1% were essential for economic fairness. Go back, and check the rates then – it will blow your mind. Then consider what a vibrant, upwardly mobile middle class we had in the 1950s and 1960s.

Sorry, anyone defending the sorry status quo is delusional or has vested interests in making the middle classes poorer.

#65 It makes some sense, but is much too broad! on 08.27.17 at 7:17 pm

Where the proposed tax code changes makes sense is for those individuals who have a single employer yet decide to pose as entrepreneurs by incorporating themselves, thereby benefitting from all the tax goodies that currently apply to corporations. This is unfair; while these individuals loose the twx benefits of rrsp, this drawback is enormously outweighted by the benefits of incorporating. This approach is quite common today for many contractors in the tech sector. Now, what I agree with is that these new tax rules should NOT impact all those folks that run an active business, especially when they have employees and take major risk in terms of serious capital outlays.

#66 Lead Paint on 08.27.17 at 7:19 pm

Unfairness is the free capital gains on sales of primary residence. 33% of Canadians can’t take advantage of that. Anyone can start a corporation if they wish. He has some gall talking about ‘fairness’.

#67 2 Cents Canadian on 08.27.17 at 7:19 pm

Morneau ….. ” there’s lots of good reason to start a business … avoiding personal tax shouldn’t be one of them”
Actually it’s nearly your only choice now as this government has created a business environment that has big business (and your potential employer) staying away in droves. If you want to make more than $15/hr. and have a smidgen of hope to be in control of your financial future, starting your own business is still your best shot. Then if by a combination of skill, smarts, risk, hard work and just plain dumb luck you manage to succeed ….. they will keep tweeking the formulas so your standard of living is just a notch above the dog f’ers and whiners.
The ambitious don’t know why are the way they are and why they try so hard to succeed …… just as the dog F’ers and whiners don’t know why they are the way they are and try to drag everyone and everything down to their lazy whiney ass level. But If you don’t allow a certain % of the ambitious make a lot of money starting and running their own business’s ……. who is going to employ the dog F’ers? (and pay Morneau’s and JT’s pay cheques). We’re running out of people and things to tax!

#68 leebow on 08.27.17 at 7:25 pm

I bet things will adjust and there will be no extra revenue.

The two -eaus believe there is way too much innovation in Canada. Will there be any incentive at all to start a tech company here instead of Delaware?

Just another Mirabel moment.

#69 SoggyShorts on 08.27.17 at 7:26 pm

#13 rknusa on 08.27.17 at 5:00 pm
some of these so called entrepenuers
i know an engineer who created a corporation
has had the same sole client for 25 years so is essentially a defacto employee
client (i.e. employer) dodges payroll taxes, engineer dodges payroll taxes, writes off his truck and many other so called business expenses, shelters his defacto wages in his corporation and only takes out what he needs at a greatly reduced tax rate
where is the risk
and this same engineer whines about so called “cash for life” public empoyees and their pensions and that he pays too much in taxes
oh yeah and he lives in his parents basement and he is 60 years old
Not credible. Any contractor with a sole client is taxed as an employee. — Garth
**************************************
You make it sound like this engineer hit the jackpot. So what if he writes off expenses? If he was an employee, then his boss would supply them and HE would write them off. Write offs sound like this magical windfall to people who don’t know better.

For the last 20 years of his career my father worked at a flooring company where every installer was a “sub contractor”. So they all had to have companies with all the related expenses, and none of the E.I. vacation pay etc. that an employee would have. They were also “strongly encouraged” not to do any work for any competitors. (if they did they’d never get work again)

I imagine this isn’t the only company doing this, and now all the crews (about 50 people) will be further screwed by the new taxes. These are not rich tax evaders, they are hard working construction stiffs.

#70 PM Trudeau needs money on 08.27.17 at 7:26 pm

Finance minister Bill Morneau needs to collect money to finance prime minister Trudeau’s tweets and other virtue signalling habits.

Hopefully voters will hand in the final check to liberals at election night.

#71 It makes some sense, but is much too broad! on 08.27.17 at 7:31 pm

Just read comment #13, which is similar to mine. You responded: “Not credible. Any contractor with a sole client is taxed as an employee. — Garth” well, that OUGHT to be the case, but in practice it seems the rules that relate to this are not enforced, save perhaps in extreme cases (25 years with the same one client…). But for IT consultants and such it is very common to have a single “employer” for multiple years, until the employer decides to not renew the contract.

#72 2 Cents Canadian on 08.27.17 at 7:32 pm

Justin Trudeau ….. ” the budget will balance itself”
Next time before I vote remind me to read the fine print.

#73 Raj on 08.27.17 at 7:34 pm

I’m not voting for the liberal anymore.I’m in IT, incorporated.No pension, health, dental or any other benefits.Just started a new contract after staying 4 months home looking for one, no EI.
Very sad !!

#74 hdj on 08.27.17 at 7:36 pm

Wow! Judging by the outrage coming from those who have been able to take advantage of our crooked tax system, the Liberals are certainly now doing the right thing. It’s time everyone was taxed equitably. Anyone who thinks the current tax system represents fair treatment for all is blinded by greed.

#75 dr. talc on 08.27.17 at 7:39 pm

The same wage slaves who are cheering M’s BS are likely smart enough to not work overtime, because they have seen the unfairness on their paycheck. Because the tax system and taxing overtime at a higher rate is against the law of nature. The law of nature dictates: he who builds, hunts, fishes, sows the most, reaps the biggest reward. Hard work and overtime is for people who want to get ahead. The government wont have that, they want you to go from your cubicle to your condo, paycheck to paycheck.

#76 NS on 08.27.17 at 7:40 pm

Does anyone know whatever happened to the tax on the really rich?

The beneficiaries of the protected oligarchy of Canada?
All the rich CEOs and top management at the TSX listed companies?

The Liberals were going to fix that and suddenly the daggers were drawn on the poor little CCPC schmuks.

Most of the people have no idea, but our respected Finance Minister knows better.

How can he with a straight face say that he’s serious about middle class taxation?

The CEOs/CXOs/top management of almost all big companies in Canada get paid in stock options, predominantly. At least 80% of their compensation. Do you know what’s their tax rate?

In Ontario, it’s half of the top rate, so about 26%. That’s right. The CEO of RBC/BMO etc. pay about 26% on their earnings and these guys are not serious about plugging that ‘loophole’.
And consider this- what’s the risk they are taking in a cushy corporate job?
Nothing. Nada Zilch. WOrst case, they don’t become a CEO and retire as an SVP with millions in stock options taxed at 26%.
No issues with all this as our dear minister takes his marching orders from the Bay Street honchos.

Remember, the Liberals has promised to plug this ‘loophole’, but they were given stern orders to back off or the consequences wouldn’t be nice.

Here’s the background material for those who wish to go through the details.

https://www.pressprogress.ca/bay_street_pressured_liberals_to_break_promise_to_close_ceo_tax_loophole_documents_show

#77 NS on 08.27.17 at 7:46 pm

For those who are following this closely, the IYI (Intellectual yet idiot as per Taleb) torchbearer Kevin Milligan at UBC created this spreadsheet:

https://docs.google.com/spreadsheets/d/1_iQ4l07X776vY82JITdgMDlEevubDYypegsYvj9JOqo/edit#gid=1495190078

He runs the advantages of income sheltering via CCPC vs non-sheltering.

For a portfolio that’s generating 5% annual returns, the current system would generate total returns of 23.46% (assuming the facetious 5% interest rate that exists in this economist’s fantasy world over 10 years).
In the grand revision, the total returns would be reduced to 14.58%
Over a period of 10 years. A difference of 8.88%. Less than 1% an year.
This is what they are wasting their energies on. And want to drive people away from Canada.
While keeping the blatant loopholes in stock option awards to the real aristocracy (See my above post) alive and kicking.

#78 bellend on 08.27.17 at 7:48 pm

willie sutton tax..
h/t to Keith at the top of this comment string

#79 2 Cents Canadian on 08.27.17 at 7:48 pm

This new tax philosophy (in broad strokes) … will repel the ambitious and entrepreneurial (or make them go under ground) ….. and attract and empower the lazy and net energy and money suckers. Do the math on how that works out in the long run.

#80 OttawaMike on 08.27.17 at 7:49 pm

#49 Ace Goodheart

Cops don’t retire after 20 years. They are on an 85 factor so the age plus years of service must equal 85. A cop who started at 21 would still need to be 50 years old to retire as that is the minimum age.

Other municipal employees are 90 factor and minimum age 55. Cops pay a considerably higher amount into their pension for the 85 factor.

Bu you go with the cops retire at 40 story as it is far more interesting.

#81 The dude on 08.27.17 at 7:50 pm

Hey Garth
How does it add up to 73% to pull out the retained earnings?

Ask your accountant. — Garth

#82 crossbordershopper on 08.27.17 at 7:51 pm

and people on here criticize me for telling them to simply pack their bags and go to the us. Ya, i have heard it all, you can say all you want negatively about america. We all know that the American government and the american people love hard working, successfully, educated people. The dont begrudge successfull, they are not critical. Dont be a winner in Canada, you will loose friends, know it first hand, in America they all want to be your friend. its bizarre. jealousy is rampant in Canada relative to the USA.
so. its simple for everyone, listen here, you get a TN Visa, simple and easy, and could become even easier with the new Trump lead Nafta changes.
then you amend your status, with an option to come back and forth,
and then finally, you become a permenant resident, the process takes start to finish 5 grand, and 3 years,
your kids will be greatefull. yes people say well if its so great, why arent you there, i am, i do business, trudeau gets nothing, how exactly did trudeau of the government of canada help me running my business in florida?
Canada is a joke, you either stay in canada, except little, or go try and make money in the usa. your choice, you can stay in canada, but trust me millions of bumbs in canada are waiting for your cheque, so get your coffee at tim’s tomorrow on your way to work, i already know your schedule tomorrow.
trudeau wants to make him my partner, puts nothing into my business, takes 1/3 to half of results and shares in zero risk or loss. what a scam.

#83 JSS on 08.27.17 at 7:54 pm

I have emailed Mr Morneau, and let him know that I’m in full support of his government. I would suspect most Canadians are.

#84 Harold on 08.27.17 at 7:57 pm

I say let the Docs move to the USA. They will turn tail and come back to Canada as soon as they find out the American taxpayers will not pay their legal bills once they get sued for malpractice like we suckers do in Canada.

#85 Middle Class Canadian on 08.27.17 at 7:58 pm

I understand that these changes are a bit of a bugbear for you, as they are for the various accountants whom you quote since they make their living setting up and administering the types of structures targeted by the proposed changes.

But I’m disappointed that you would stoop to misinformation (or something close to that) in this post in attempting to rouse the rabble.

First, your example about the electrician’s wife is misleading. If she is, in fact, doing the books she can of course receive fair compensation. You do not directly say that she can’t but it is implied. Nothing in these changes prevent spouses who have contributed capital or labour from sharing an appropriate amount of the income.

Second, I’ve read again and again people comparing the benefit of retaining income in the corporation and investing it passively to RRSPs. If the benefits are comparable, then these “small business owners” should pay themselves a salary and use the RRSP contribution room that would be generated. Of course, no one does that because the benefits are not remotely comparable.

I think there is a real discussion to be had about tax fairness. But this type of misinformation is clouding the issue.

No misinformation. The spouse of a risk-taking small businessperson is intimately involved in all aspects of the enterprise by virtue is the household and family sacrifices involved. Paying her $16 an hour as you might a casual employee is improper, inadequate compensation. Sexist and insulting. As for RRSPs vs retained earnings, the drain on the public purse through RRSP deductions far exceeds the money these changes might raise. Your views are not rooted in fact. — Garth

#86 Caleb Landry on 08.27.17 at 8:00 pm

For those people who hate the fact that an individual can earn $400,000 a year – I’d suggest going back to school, working harder, changing careers or finding the drive to go out and start something on your own.

Let’s get clear about something. If someone earns $50,000 a year, at most, they end up with a $15,000 tax bill.

With a corp, if you earned $400,000 – you’d cut a cheque for $60,000 in corporate taxes, another $20,000 in GST and if the owner paid himself from the $320,000 that was left over – he’d be paying the exact same rates as anyone else in the country. So, say the owner pays himself $100,000 – that’s another $30,000.

So, you still think that $110,000 + on a $400,000 income isn’t fair? It’s almost 7 times as much as someone earning $50,000 a year. If you look at it another way, I think it’s wildly unfair that I have to subsidize 7 other people’s costs of governance because they don’t have the same drive or work ethic as me. Slippery slope people…

Fairness…

Have a look at this…

This woman was a stay at home mom – started this business on the side – now does $300m a year in sales.

https://mypillowpets.com/

Why don’t we all pile on and tell her that she’s a piece of crap for having done something successful?

Point is, she could have spent her energy pouting about people who earn real money, instead, she did what she did. Now, her tax bill is likely in the tens of millions a year – subsidizing thousands and thousands of people’s governance costs.

Only difference, she lives in the USA – where the market is infinite.

Canada’s market is anything but infinite – incentives in this country matter if you want to retain the best and brightest.

These tax changes will set off one of the biggest brain drains this country has ever seen.

Well done Bill. Well done.

#87 Graeme on 08.27.17 at 8:01 pm

Thanks for Morneau’s address, I will be writing to give him my whole hearted support! It’s about time.

#88 KM on 08.27.17 at 8:03 pm

My email attached. Frustrating to see the entitled liberal backers cheering the proposed tax changes. They are cheering the destruction of their own health care system. Sad and pathetic. Physicians on the other hand, will be OK.

Dear Mr Morneau,
I realize that this consultation period for the tax changes that you want to implement this fall is nothing more than a front. I know that it is a done deal.

I am just another physician who you are targeting with these tax changes. But I for one thank you. I will not be quitting and moving to America. I will simply cut back and let my waitlists grow as many of my colleagues have already started to do. I will also lay off my billing clerk, 1 of my 2 secretaries and 2 of the nurses in my clinic so that I can continue to adequately save for retirement.

Despite what many of my colleagues say, we will be ok, at least financially with these above measures. But many of my support staff who belong to the middle class that you vow to protect from me and my colleagues? I’m not so sure.

I will however stress Mr Morneau, PATIENT CARE WILL SUFFER! It is not a threat, I care for my patients and will continue to do so. But I will not work the long hours I work currently as a surgeon when we are not fairly treated for these sacrifices.

So I thank you. My wife thanks you. My kids thank you. I will be spending a lot more time with them than I have for the last two decades.

#89 NS on 08.27.17 at 8:03 pm

I’ve a lot to get off my chest, so I’ll just sprout some more facts for those who are very envious of the contractor types.
I’ve been a headhunter in my previous life and I know all the reasons whey these contractors are put in place.
To save money for the contracting organization, which happen to be the key pillars of our economy- Healthcare, Government and the Oligopolies in Banking, Insurance and other industries.
Let me walk you through the relative scenarios:

Position: IT Architect.

Salary at half decent place in GTA: $130k to $150k.
Total cost to the employer, including benefits, EI, CPP, 4 weeks vacation, stats time off- at least 25%. Let’s say 200k.

For a contractor, the pay is unlikely to be more than 100/hour. For 2000 hours, it rounds to about 200k.

If someone had a choice to make, which way would you go? Clearly from an employer’s perspective the answer is obvious. Contracting wins.

From the contractor/employee perspective, the only reason to even consider this would be the CCPC 15% tax rate. Take that away and you end up getting taxed at the same rate as an employee and get nada/zilch in benefits. Plus you get no vacation time. No stability. and you pay double the CPP.

With the CCPC sheltering gone, the governments and all the bigger corporates will have to pay out more to get the same quality of people. That will ultimately result in more cost to taxpayer and less taxes to the government(corp expenditure going up).

The market for high quality talent is global. For those who were just hanging on by the fingernails in this country, this will be it. IT, Medicine and Entrepreneurs will be the first ones to get out of here. And the impact will be felt in the coming years.

#90 KLNR on 08.27.17 at 8:08 pm

don’t let the door hit you on the way out jake.
about time these tax loopholes were taken care of.

#91 Nonplused on 08.27.17 at 8:12 pm

There is another way the legislation hit small businesses. Many small businesses have variable incomes that can differ largely from year to year. For example two years ago i cleared $170,000 but last year only $20,000. But I didn’t pay myself 170 and then 20, that would be tax suicide. Instead I smoothed it by paying myself $60,000 each year, which is about all I need to live and lowers the effective tax rate and more accurately reflects my average income over time. But as I understand the new rules I ain’t gonna be able to do that anymore, I’ll have to pay the highest tax rate in good years and it sucks to be me in bad years. I hate Turdeau and Moroni. They obviously know absolutely nothing about how a small business operates. All it is is a politically correct tax grab that mellenials don’t understand except that it doesn’t affect many of them so it must be good.

#92 Terry on 08.27.17 at 8:26 pm

38% of Canadians voted Liberal. This gave them a Majority government. 62% of Canadians voted for someone else or didn’t bother to vote at all. This is what you get when the Liberals get into power. Liberalism is best described as a disease and the cure is Conservatism!

#93 taxpayer on 08.27.17 at 8:28 pm

Maybe the government wouldn’t have to change the tax rules if the underground economy wasn’t out of control with ‘small businesses’. Who doesn’t know someone working for cash or offering cash to a business for their service to avoid paying tax. Are we really to believe all family members do legitimate work for the family business to earn the pay they receive?You can thank all the business that work ‘under the table’ for what the Liberals are introducing.Remember in school when the whole class was punished because the teacher couldn’t find the culprit who wrote something rude on the blackboard. Same principle here. And what about all these minimum wage jobs created by small business that pay no benefits? Not exactly easy street for the employees. I know we hear constantly about the ‘risk’ taken by the entrepreneur but hello? if your product/service is inferior to the guy down the street, get better or …so long. Meanwhile you get many tax breaks[loopholes] and blame everyone but yourself for your failed business. Tax avoidance is huge in today’s society..go get ’em Mr Morneau!!

#94 X on 08.27.17 at 8:32 pm

What I find ‘funny’ is that the income it appears Morneau is referring to, assuming it is within the corporation, isn’t actually personal tax at all.

I guess you reap what you sow, hoping that small business owner vote differently next election.

Same for the Liberals….explain the lack of economic growth after the taxes are implemented.

Unless they want everyone to become unionized so Morneau-Sheppell can achieve record profits.

Personally it bothers me how this is being pitched as a DR tax on the rich, when it effects so many other professions, industries….

Tax Fairness….then I look forward to your government reducing the personal tax rate for all to the same percentage Mr Morneau and PM Trudeau.

I look forward to hearing about what type of business Mr Morneau plans on opening under these new rules.

#95 NoName on 08.27.17 at 8:33 pm

Its not easy to electrician’s wife, because electricians work with strippers every day.

#96 knock knock, whose there? your honest realtor. on 08.27.17 at 8:34 pm

just did the same thing
#9 A Dollar is a Dollar is a Dollar on 08.27.17 at 4:44 pm

#97 Justtiredandretired on 08.27.17 at 8:35 pm

This sums it up quite nicely

Dear Mr. Morneau,

I’m curious to know why you believe it’s in Canada’s best interest to discourage business and encourage socialism.

It is my opinion that your discussion paper proposing changes to the taxation of small businesses completely misrepresents the facts, and it’s hard for me to imagine what your objective is. Hundreds of thousands of Canadians have spent their entire working lives building this country, and yet under the banner of “fair” you set out to destroy their businesses, and ultimately, their retirement plans. In many cases you’re not simply changing the rules; you’re changing the entire game.

In your discussion paper you talk about what the government stands to gain from eliminating income splitting and increasing the tax rate on passive income within corporations, but nowhere do you quantify the cost. Have you and Mr. Trudeau thought about what the cost of your proposals will be?

We’ve heard from business owners all across Canada and regardless of the business, they all agree that higher taxes means higher costs. Higher costs that will ultimately be borne by consumers — it’s just that simple!

In the discussion paper, you use an example of neighbours who each earn $220,000 per year. Have you looked at the statistics? According to Statistics Canada less than 2.35 per cent of Canadians make $220,000 or more per year.

What you have failed to do is describe the difference between an employee and someone who’s taken a chance and gone into business for themselves.
You are trying to convince the Canadian public that all business people are rich and that they use all these tax loopholes to reduce or avoid. What you have failed to do is describe the difference between an employee and someone who’s taken a chance and gone into business for themselves.

In the discussion paper, on page 13 you introduce us to Jonah and Susan. Jonah has a private corporation and Susan is an employee. You state that Susan’s household pays $35,000 more income tax than Jonah’s, and that just isn’t fair.

I’ve taken the liberty to outline the differences between being a self-employed private business owner and employee. Let’s look at the job description for a private business owner:

Variable income not guaranteed
No job security or workplace accommodation
Must personally guarantee company/business debt
No Employment Insurance (EI) coverage
Canada Pension Plan (CPP) coverage at twice the legislated employee cost
Hours extremely variable (can vary from 0 to 90 hours per week). Must be willing to work additional 20 hours or more a week without notice. No overtime pay.
No paid holidays
No paid parental/maternity leave
No paid bereavement leave
No extended health, dental or insurance benefits
No employer matching retirement program
Statutory holidays will not be covered
Should you require additional employees for completing your work, you shall be personally liable for:
guaranteeing they have a steady and reliable minimum income
covering 58 per cent of their EI cost
covering 50 per cent of their CPP cost
meeting all statutory labour requirements for work hours, overtime hours and pay, holiday leave and pay, statutory holidays and parental/maternity leave.
accommodating them for any limitation preventing them from completing the work they are providing you
damages should you no longer require their assistance

Now let’s talk about Susan the employee. Let’s say she’s one of your deputy ministers. A federal deputy minister makes about $220,000 per year. What else would they be entitled to? Correct me if I’m wrong, but I think it looks something like this:

Employer’s pension contribution up to $25,000
Employee benefits $6,000
Employer CPP contributions $2,569
Employer EI contributions $1,170
Up to eight weeks of vacation (worth) $33,846
10 statutory holidays (worth) $8,461
Up to 15 sick days per year (worth) $12,692
All of these entitlements add up to $89,738.

Did I miss anything? I’m not sure if I should add anything for employer paid parties, food and drinks.

Whether it’s a physician or a plumber, it makes no difference. All businesses take risks.
It looks to me like the extra $35,000 that Susan is paying in income tax might not represent the full picture. When including the almost $90,000 in benefits that she is entitled to that a business owner is not, she is in a much better position than the example you used to justify your changes and might actually be better off than Jonah.

You can’t and shouldn’t be allowed to compare an employee with an employer. What makes Canada great is having individuals who are willing to put their financial lives on the line to start businesses and employ those who chose not to take the chance. Whether it’s a physician or a plumber, it makes no difference. All businesses take risks. What you’re proposing strikes directly at the heart of small business. If Canadians really understood what the facts were I don’t think they’d be inclined to support your proposal.

I ask, on behalf of all Canadians, kindly leave the current integrated tax system alone and honour the system that was put in place by your party 45 years ago.

#98 Caleb your arithmetic is flawed on 08.27.17 at 8:36 pm

#86 Caleb: your inclusion of the remittance of GST is ridiculous. When adding GST and provincial sales taxes to an invoiced amounts, the company is merely serving as a collection agents for the revenue authorities. These amounts are NOT part of the company’s revenue, and indeed no accountant will account for them as such. This is just one of the bullshit arguments in your misleading post, but certainly the most egregious. Please stick with the facts, dude.

#99 Newcomer on 08.27.17 at 8:42 pm

It’s disingenuous of those accountants to bitch and moan, considering that they will be the main beneficiaries of the tax changes. Few people will opt to pay more taxes, they will just pay their accountants more to restructure and restate in a way that complies with the new regulations and minimizes tax.

Then perhaps they are speaking out of principle. Hard to recognize these days, isn’t it? — Garth

#100 Dr. Talc on 08.27.17 at 8:42 pm

I’m call BS on 90% of these comments supporting Morneau. It is impossible that this blog can mobilize so many lick lick, kiss kiss grovelling shits to email Morneau their support. These comments are paid shills, CRA employees; Morneau will soon be on TV that no one watches saying
“The public support is overwhelming”

#101 jobo on 08.27.17 at 8:43 pm

Best line of the year:
“Canada, democracy for a day, dictatorship for next 4 years”

Suck it Lieberals!

#102 Big Heart on 08.27.17 at 8:43 pm

The spouse of a risk-taking small businessperson is intimately involved in all aspects of the enterprise by virtue of the household and family sacrifices involved. Paying her $16 an hour as you might a casual employee is improper. — Garth

You almost made me grab some tissues. I have to think really hard when was the last time you were so poetic.

When you and your wife have lived such experiences you will realize how petty your words sound. — Garth

#103 millmech on 08.27.17 at 8:43 pm

I wonder how many of the people who are in favour of this work for a small business who may very well decide to close up shop and become a wage earner like their former employees.
What is in it for business to employ people who get substantially more benefits(EI,CPP,paid sick days etc) with no risk at all as they get a paycheque every two weeks.
I guess that these formerly employed people will step up to the plate like their former employer and take the risks and pay the 73% tax rate(which is only fair).
Also as a former business owner I know you can not only work for one employer as I knew a few guys that did that and got destroyed as the CRA classisfied them as employees.I always made sure I worked for at least four companies every year to avoid that experience.

#104 Smoking Man on 08.27.17 at 8:49 pm

A tribute to every real writer out there.https://youtu.be/tAGnKpE4NCI

#105 Captain.Super.Duper on 08.27.17 at 8:52 pm

Australia is beautiful this time of year. To be honest it’s beautiful EVERY time of year. Plus it’s safe and full of friendly people. What’s not to like?

Breaking News: Australia wants more small entrepreneurs.
Australia – Business Innovation and Investment (Provisional) visa (subclass 188)

Entrepreneur stream: for people who have a funding agreement from a third party for at least AUD200 000 to undertake a complying entrepreneur activity that is proposed to lead to either the commercialisation of a product or service in Australia or the development of a business in Australia. Applicants must be nominated by a state or territory government.

#106 WDL on 08.27.17 at 8:54 pm

Ten years ago at age 48, I spontaneously quit a good paying job as a CEO because I loathed it and dreaded going into work every day. My wife and I had the brilliant idea to start our own business. The first 5 years were gruelling, financially. At every years end, when we realized how little we made, she begged me to shut the business down. It was so bad financially we cashed in some RRSP’s and investments to try and give the business a bit of a tail wind. After year 6 things brightened for us and now in year 10 our business is doing very well. We profited about $250,000 last year and we are still growing. We have grown to 10 full time employees and we are looking to expand in the future. I know my business was started with a great deal of sacrifice, 80-100 hour work weeks, and a lot of sweat and tears. A small incorporated business is NOT a tax haven. It puts a roof over the heads of families and meals on the table. Prime Minister Trudeau was born with a silver spoon in his mouth. He has no clue what entrepreneurs and small business owners go through to start a business.

#107 Timberrr on 08.27.17 at 8:55 pm

“Worse, the business guy has no heath or dental coverage, no paid sick days, no EI, no vacation, no company pension, no matched RRSP, plus endless risk. ”

———————————————————-

Tough shit. When Gordon Campbell the conservative BC premier ripped up union contracts and went on a union job busting program in the early 2000’s and privatized government jobs by the boatload I went to work for
one of these “privatized contractors” out of desperation. Wages were 25% lower, no health, no overtime, no guaranteed hours, no sick time,no holidays, no nothing. Meanwhile the “contractor” reaped twice as much as the worker, did zero work and showed up once a month to give out the pay cheques and tell us how lucky we were.

Therefore I give two shits when most small businesses pay eff all for wages and benefits or are scamming the tax system and flipping houses inside them etc to avoid taxes. Go Justin !

#108 conan on 08.27.17 at 8:56 pm

So far I do not see the grief on these tax changes for corporations. Most people I know who are sole proprietors have a skill, or a trade, that makes them more valuable then an employee. These people all get paid more per hour, then employees, much more.

Do they lose their right to purchase Individual Pension Plans? This lamentation of the fallen seems to be coming from peeps that are likely to see client money walk out the door.

Everyone needs to pivot.

https://imgur.com/8I5L1Ub

#109 Blacksheep on 08.27.17 at 8:56 pm

Maybe Smoking man is onto something.

Liquidate the business and the house and call her a day. There is more than one way to skin a cat…

https://www.theearthawaits.com/

#110 Bobby on 08.27.17 at 8:57 pm

Our selfie PM and the Finance minister aren’t the least bit interested in common sense. The fact that small business creates most jobs is irrelevant, their sole interest is getting re-elected. They have tapped into a broad source of voters who have little financial knowledge and even fewer assets. Those who have worked hard, given up much in their personal lives and prospered are the new bad guys. Their clarion call of tax the rich resonates with this group and that is what matters to this PM.
These voters couldn’t care less if their doctors tax bill rises exponentially. What will resonate is if their doctor reduces his hours or packs up and moves to the US.

#111 DD on 08.27.17 at 8:59 pm

Most divisive and incompetent PM in Canadian history.

#112 2 Cents Canadian on 08.27.17 at 9:02 pm

#93 Taxpayer
Re: underground economy
The more you tax people the more they will go underground. With a “reasonable” tax system (most) people would be happy to pay their taxes. There is a sweet spot that has to be found. But if you raise taxes 10% and 11% of the tax payers say “F” it! and go underground (cash business) …. you are going backwards.
Smart, hardworking, ambitious people aren’t stupid ….. they won’t work their selves to the bone and give it away to the boat achors. Nore would you if you were smart, hardworking and ambitious.

#113 Costco Nation on 08.27.17 at 9:07 pm

Bolsheviks at the wheel. This will be so fun to watch. From afar. The ones who don’t like this, fight it back while you can. Time is short, if any. The ones acclaiming it, enjoy you MF. As for me, never again.

#114 2 Cents Canadian on 08.27.17 at 9:09 pm

There has to be the perception of hope. Hope that one can get ahead. Cuz if you spend all your time and energy trying to keep up …. you have zero time and energy to put towards getting ahead. And getting ahead is what you have to do i you don’t want to spend all your life just trying to keep up. Got it?

#115 Vancouver in the Rearview on 08.27.17 at 9:09 pm

The income sprinkling practice is nonsensical, and is rampant in the physician community, and it needs to end. Good on Morneau for finally addressing this.

And some facts on doctors going to the United States: they’re not, and certainly not in any significant numbers. Recent data (CFHI and CIHI) says that there is net in-migration of physicians, and that there are at least ten applicants for every spot in medical school.

There will be no shortage of physicians…in fact, the bigger problem is that we are training too many, and cannot afford the ones we have, who are increasingly a) female (Hedden et al, 2014), b) working fewer productive hours (Hedden et al, 2014), and c) struggling to find sufficient employment, particularly in specialties that are resource and equipment intensive (RCPSC, 2014).

There’s a good reason that the Ontario government is in open warfare with its doctors – the bank has been broken, and physicians are virtually unaccountable for their decisions. We are paying way more (McGrail 2011) and we’ve hit the limit of what we are willing to pay for given current levels of taxation. Other provinces will follow suit, because they’re just as messed up financially as Ontario is. While the ‘silver tsunami’ is a bit of an overstatement, most hospitals are running at or beyond capacity in this country, every single day of the year.

Killing off the corporation structure is the first step in making physicians employees, and dispensing with fee-for-service, an unaccountable and wasteful system that provides no accountability and rewards volume, instead of quality. The NHS got this right in the UK; the evidence that FFS is wrongheaded is clear. I hope this is the direction that the feds are looking to go.

#116 Mattl on 08.27.17 at 9:12 pm

I’m opposed to the changes as I ultimately intend to get in on the action. The blog dog “entrepreneur” likely employs no one and realized he can play the tax code to work less and make more. I’m all for that but lets not pretend guys like him are bootstrapping startups that will employ hundreds of Canadians. More likely one man corps contributing the same value to the economy at a significantly lower tax burden. As a high earning employee with close to zero tax advantages, I hope the changes don’t go through so I can get in on the hustle and split income with my stay at home wife.

#117 MF on 08.27.17 at 9:16 pm

Let’s not forget these morons were voted in.

First off, if you are over 25 and you voted Liberal you are an idiot and get what you deserve.

Secondly, if you didn’t, then make sure you are vocal during the next election to vote these idiots out.

MF

#118 Smoking Man on 08.27.17 at 9:17 pm

DELETED

#119 kabloona on 08.27.17 at 9:18 pm

I’ll email him and say I agree 100%….

:-)

#120 Pete from St. Cesaire on 08.27.17 at 9:22 pm

#86 Caleb Landry You should have mentioned that Mrs. Telfer of MYPILLOWPETS is married to a man from Ontario. She could have chosen to run her business here but who in their right mind would want to pay Canadian taxes. Just another example of a very successful business that didn’t come our way.

#121 Lee on 08.27.17 at 9:22 pm

These changes are going to result in huge layoffs in the legal profession. Probably 5-7% of employees will be tossed. Mostly law clerks.

#122 One of those collection agents on 08.27.17 at 9:23 pm

#98….merely serving as collection agents for the revenue authorities…..yes, as an “agent” I get to spend my own time and money charging, collecting, tracking, and remitting the governments tax –I even get to pay bloody credit card fees on the governments tax! Lucky me, I get to do this for free!
You couldn’t even buy a clue.

#123 crowdedelevatorfartz on 08.27.17 at 9:23 pm

Harper’s arrogance followed by $enator Duffy’s arrogance …..led to their political downfall in the last election….
Stupidty and arrogance by the rich eleitist socialist Liberal govt after almost 2 years of feel good “selfies” by Baby Trudeau…..Lets see how they do in the polls in the next year with imploding housing sales and rising interest rates.

#124 Spock on 08.27.17 at 9:25 pm

Looking at the number of people who are happy about these tax changes – it is no surprise that Trudeau and his divisive politics get a majority. They are hoping divisive class and religious politics gets them the majority again.

Simple math is hard to understand for most folks. I cannot wait for the day when some politician with guts gets ride of defined benefit plans for all Government workers because the tax payers just cannot afford it.

I hope these same jokers lose their jobs when their small business employer wants to reduce expenses. Then you can test out the free money program that has been instituted.

Combine these changes with the increase in minimum wage in Ontario and a lot of employees are going to have a shock when their employer reduces their hours or number of employees.

Then you can be happy about the changes that you are cheering on right now. Everything goes in a circle and every action has an equal and opposite reaction.

#125 AsiaKid on 08.27.17 at 9:26 pm

I don’t think Bill knows the difference between “fair” and equal outcomes.

I have had employees ask why they shouldn’t earn more and get more upside given their (self-assessed) huge contribution. My response is i) do you take less pay when you don’t perform as well? Why get upside with no downside ii) what about my reward for close to 7 years of not taking pay.

We have become a society of populists, run by majority state of mind. I guess the way I should think about it is should be cup half full: more people doing things the wrong way means more opportunities to find and create advantage for myself.

I am not an entrepreneur in Canada, but I have already decided that after selling my company I will not start one in Canada given the tax and general privileges and protections for employees. This is not a slight at the people of Canada, but more the competitiveness of the employee population and the laws that define and restrict employer obligations and actions.

#126 Tony J on 08.27.17 at 9:28 pm

Anonymous posters tend to be so disingenuous. It seems that some here are pleased that the government intends to ‘stick it’ to small businesses, yet I would bet that these same individuals would be the first to gripe if their food prices increased or non government service costs went up as a result. Or heavens forbid, ‘their’ doctor retired or left their practice as a result of the changes. Amazing that the Liberals have managed in a such a short time, to start a class war against small business owners.

#127 Paul on 08.27.17 at 9:34 pm

Small or owner operator company’s made into crooks hiding income, working for cash just to keep the doors open. The government driving cashless society they want it all! I get it we all need to pay our fair share,but I have witnessed closed bissnesses over regulations, soring utilities,EI, workman’s compensation, TAXES, the list is endless.
Before they are called poor operators etc. Some ran their companies for years grinding 10 to 12 hours a day and had jobs for 35 people.

#128 Al on 08.27.17 at 9:36 pm

“Might as well just take the civil service exams out of high school, put your 20 years in and then ride off into the sunset, defined benefit style, at age 40. Why in the world would anyone put in the work to accomplish something more difficult?

It doesn’t make sense anymore.”

Where can I start work at 20 and retire at 40 and collect my defined benefit pension? Federal civil servant pension can only be collected at 50 years of age at the earliest, and that would be with a 50% reduction. With 20 years of service and 100k/yr of pensionable earnings, you would “retire” at 40 unable to collect anything. perhaps live with your parents for the next decade until you’re 50?? With 20yr service you’d be entitled to 40k -50% pension at 50 yo. Finally you can ride off into the sunset at 50 with your 20k/yr gross , db pension style…

#129 Smoking Man on 08.27.17 at 9:39 pm

#118 Smoking Man on 08.27.17 at 9:17 pm
DELETED

bastard

#130 Doug on 08.27.17 at 9:42 pm

I’ve had enough. Incorporated 30 years ago and tried to set aside money for retirement. I’m a farmer that employs 2 full time and 2 part timers. In the process of shutting her down. Incentive to continue just not there anymorneau.

#131 Spock on 08.27.17 at 9:44 pm

#107 Timberrr:

You should be thankful the contractor gave a person of your intellect a job due to which you and family (if you had anyone dependent on you) could survive. So instead of calling the contractor names be thankful you are in a position to post your pitiful thoughts on this blog.

#107 Timberrr on 08.27.17 at 8:55 pm
“Worse, the business guy has no heath or dental coverage, no paid sick days, no EI, no vacation, no company pension, no matched RRSP, plus endless risk. ”

———————————————————-

Tough shit. When Gordon Campbell the conservative BC premier ripped up union contracts and went on a union job busting program in the early 2000’s and privatized government jobs by the boatload I went to work for
one of these “privatized contractors” out of desperation. Wages were 25% lower, no health, no overtime, no guaranteed hours, no sick time,no holidays, no nothing. Meanwhile the “contractor” reaped twice as much as the worker, did zero work and showed up once a month to give out the pay cheques and tell us how lucky we were.

Therefore I give two shits when most small businesses pay eff all for wages and benefits or are scamming the tax system and flipping houses inside them etc to avoid taxes. Go Justin !

#132 Smoking Man on 08.27.17 at 9:44 pm

DELETED

#133 Fran Deck Jr. on 08.27.17 at 9:45 pm

Anyone who would applaud a tax increase has never worked for a living.

#134 Right said Fred on 08.27.17 at 9:49 pm

DELETED

#135 Leo Trollstoy on 08.27.17 at 9:50 pm

#15 Where is that? on 08.27.17 at 5:07 pm
“$400+k a year in salary/commissions.”

Where do I sign up for that?

Bay St.

Number looks slightly stale. It’s at $600k now.

#136 Loonie Doctor on 08.27.17 at 9:51 pm

#115

You lament that doctors are working less productive hours. What do you think will be the effect of having punitive tax levels? I can tell you that for me personally, it means I will work less. I have already started this plan over the past two years and decreased by about 25%. That was stimulated by the Wynne/Hoskin 5% OHIP clawback and Trudeau’s 54% marginal rate giving me a 59% marginal rate. Simply not worth the sacrifice of time from my family and other interests for 41 cents on the dollar. Add in the fact you pay 13% more when you spend it on anything makes it 28 cents on the dollar in real purchasing power. The only thing a sane person can do is work less and spend less and do most jobs around your house yourself rather than hire someone with after tax dollars. I am a 41 year old doctor in my prime and while producing less healthcare is bad for the system and decreasing my spending is bad for the economy it is good for my life balance. I guess I should thank Mourneau because this will be enough to cause me to cut back to the minimum I need to provide a decent life for my family – most of which is not money and – and stay below the top marginal tax rate.

#137 Right said Fred on 08.27.17 at 9:51 pm

Duffy wants that $8 million!! Khadr got his $10.5 million. They have to raise the money somehow. Why not target small business!!

#138 Right said Fred on 08.27.17 at 9:55 pm

Why effectively raise taxes on small businesses?

Trudeau: “Because it’s 2016”

#139 Leo Trollstoy on 08.27.17 at 9:57 pm

#52 Kallamazoo on 08.27.17 at 6:46 pm

Stop embarrassing yourself with your changing story

#140 Yuus bin Haad on 08.27.17 at 9:58 pm

Now can we drop the angst about Trump and direct it to Twinkle-Toes and his friends?

#141 Leo Trollstoy on 08.27.17 at 10:00 pm

The physician response will be predictable. Less medical billed items and more elective/cosmetic billed items.

No point getting $30 when you can get $300 for the same 15 minutes.

#142 Al on 08.27.17 at 10:01 pm

Who would have thought that accounting firms would be publicly against tax policies that may negatively($$) affect their client base?

Must be principles.

#143 M on 08.27.17 at 10:04 pm

These ([email protected]) are not evil people Gartho baby.
They are not even “idiots” category.
..nor are they unaware of what they’re doing.
It’s just because… Gov is broke.
It’s the only thing before defaulting on debt in a few years will hit home.
Either default to CREDITORS or default to BENEFICIARIES… whether they are irresponsible investors in gov kitty…or the employees pensions… or the healthcare (38% of that is covered by the fed in the provinces).
Get used to it. ANY color coming to govern will be confronted with the prospect of gov default. Harper gave the hint with the TFSA. The ONLY vehicle to ensure some pension – if only used properly.
So stop crying “injustice”. Is the collective fault of an irresponsible plebe (check out the RE ownership percentage in the population) AND its leaders.
What you see…are the consequences. All you have to (and can) do is to acknowledge the situation and act acordingly.
So stop whining that gov does this and that… Gov is broke and desperate. They will rob everybody blind until there is nothing to rob.
It’s a constant in history.
Why you people think are you are so different ???

u better have a little bit set on a gov bond default in your portfolio on a 2 to 6 years horizon. This , my friends…is ALL you can do. and is no little thing.

Swearing Morneau is useless. He is a liar in the sense that he doesn’t come clean to the moronic voter saying:
:WE are broke. You , I ,,and everyone else that lives in the big white north”

…then again… who would get elected on truth ?

:)

#144 Lee on 08.27.17 at 10:04 pm

#128 Al,

You don’t max out a defined benefit pension plan until you have worked 35 years for an employer or multiple employers within the same or similar plans. Nobody but NBA players retire at 40. Teachers for example start at about 25 and retire at 60. Some cops do better since they can start earlier.

#145 Joe Schmoe on 08.27.17 at 10:06 pm

JT and BM have clearly had to buy friends their whole lives…now they get to go it with other people’s money!

I chuckle at the “fair share” line…I know doctors who are not incorporated who have paid $400K in taxes. Clearly they are not paying enough! One lady is a single mom with two kids that go to local public school. Nice people. But clearly evil.

#146 meslippery on 08.27.17 at 10:09 pm

Well when you cannot just add a buck or two to the giant
middle class, like in times gone by because of free trade and the will to destroy the middle class.
We will tax those who are left.
Yeah people who have money.

#147 Keith in Calgary on 08.27.17 at 10:10 pm

I ran a small business for five and a half years. Average annual revenue was 5-6MM.

My wife had her own full time job (as probably 75% of spouses do) and did not have any risk due to my self employment, nor did she work for my corporation…….ergo setting her up for income sprinkling would have been immoral and fraudulent, as I suspect 90% of such arrangements are.

Income is income……tax everyone the same. That is what is fair and what it looks like is being done here.

In my case I kept all the profit of my labor and paid my taxes accordingly, rather than working for someone else, doing the exact same thing, and making 1/4 of what zip did in my business.

Having said that, the rewards to running a successful business are more than just financial as well, regardless of the tax rate.

In the interests of full disclosure I lean so far to the right that I often walk in a circle, but, I voted for Trudeau simply because he said he would legalize weed.

#148 Cheese on 08.27.17 at 10:12 pm

I make 26k a year and work full time physical labour…. I hate myself and I want to die. Let my misery put everyone else’s life in perspective….

#149 Smoking Man on 08.27.17 at 10:14 pm

When the head thinks can out maneuver the key board,
bed time is near.

#150 Chaddywack on 08.27.17 at 10:16 pm

Unfortunately T2 is still riding high in the polls despite his obviously moronic nature. Last estimate from NANOS was that Liberals would get 197 seats if an election were held now. I don’t know how since everyone I know plans to not vote for him.

So far he’s very very popular and very teflon coated.

I thought Khadr would be a drop but his popularity seems to have gone up after the payout!

#151 Spock on 08.27.17 at 10:19 pm

#145 – I guess Justin can con the system (as per their words) for himself (setting up a corporation for his speaking gigs so he does not have to pay a higher tax).

The problem with giving a person who has never held a real job in his life and was born with a silver spoon is that said person assumes that anyone successful has reached that stage by doing the same as himself – NOTHING.

If Justin applied for a job at my business he will not even get minimum wage due to lack of employable skills and I doubt most employers would hire him because last time I checked “able to take selfies” is not a qualification which most businesses require.

Canada is just getting a dose of what Ontario has endured for many many years and by the time these clowns are done, the hole will be so big that we will not be able to get out.

#145 Joe Schmoe on 08.27.17 at 10:06 pm
JT and BM have clearly had to buy friends their whole lives…now they get to go it with other people’s money!

I chuckle at the “fair share” line…I know doctors who are not incorporated who have paid $400K in taxes. Clearly they are not paying enough! One lady is a single mom with two kids that go to local public school. Nice people. But clearly evil.

#152 NoName on 08.27.17 at 10:20 pm

#134 Right said Fred on 08.27.17 at 9:49 pm
DELETED
—-
To sexy, or not sexy enough?
https://youtu.be/39YUXIKrOFk

#153 Leo Trollstoy on 08.27.17 at 10:22 pm

#144 Lee on 08.27.17 at 10:04 pm
Teachers for example start at about 25 and retire at 60.

The teachers in my family retired at 55. Say it’s common. Sorry to dispute your comment.

#154 Spock on 08.27.17 at 10:22 pm

#147 Keith in Calgary on 08.27.17 at 10:10 pm

So easy to buy votes in Canada. Supposedly a businessman with $5-6M of income and leaning right sells his vote for ability to get high. Sure.

#147 Keith in Calgary on 08.27.17 at 10:10 pm
I ran a small business for five and a half years. Average annual revenue was 5-6MM.

My wife had her own full time job (as probably 75% of spouses do) and did not have any risk due to my self employment, nor did she work for my corporation…….ergo setting her up for income sprinkling would have been immoral and fraudulent, as I suspect 90% of such arrangements are.

Income is income……tax everyone the same. That is what is fair and what it looks like is being done here.

In my case I kept all the profit of my labor and paid my taxes accordingly, rather than working for someone else, doing the exact same thing, and making 1/4 of what zip did in my business.

Having said that, the rewards to running a successful business are more than just financial as well, regardless of the tax rate.

In the interests of full disclosure I lean so far to the right that I often walk in a circle, but, I voted for Trudeau simply because he said he would legalize weed.

#155 Chris on 08.27.17 at 10:22 pm

Gee, I wonder if Trudeau’s various ‘companies’ will be impacted by these tax changes…(I know. Of course not)

Assets: Receivable from 7664699 Canada Inc.
Trusts: Co-beneficiary of the Pierre Elliot Trudeau Trust
Private Corporations:
Co-owner of 90562 Canada Ltd. which owns publicly traded securities
Sole owner of 7664699 Canada Inc. which owns publicly traded securities
Affiliated Corporations:
176078 Canada Ltd.
3323561 Canada Inc.
Activities:
Vice-President of 90562 Canada Ltd.
President of 7664699 Canada Inc.
Board Member at Pierre Elliot Trudeau Trust

#156 Fake News Again on 08.27.17 at 10:23 pm

Several years ago Garth said that 500K people were going to retire every year for many years. Well….in BLOATED Govt Canada….150K of those people are going to be Govt Workers. And when Garth said that I said to myself “Self…whom is going to pay for all those Govt workers who retire at 60 and go buy their 250K RVs or their house in Mexico with pensions”.

Now you have your answer. The “new tax” next year is just a taste of things to come. 500 billion dollars is owed to these govt workers. Someone draw me a map as to how they will get paid without jacking up taxes.

#157 Mark on 08.27.17 at 10:26 pm

No sympathy whatsoever for the banker, finance, or quasi-government-employee types (doctors) who are going to be subjected to tax fairness under these proposals. And IT contractors, in most cases, aren’t really arms-length of their employers, and hence, shouldn’t really be considered independent contractors/corporations either.

Morneau has my support in implementing tax fairness. The tax system is severely flawed if, by employing an fancy accountant or fancy tax lawyers, one can structure their affairs to reduce tax.

The Canadian economy desperately needs tax fairness so that employment opportunities can be increased for all, not just a select few in a few specific sectors that have the ability to exploit the loopholes.

Accounting firms claim the measures will likely reduce employment. Did you just make that benefit up? — Garth

#158 Mark on 08.27.17 at 10:33 pm

“Combine these changes with the increase in minimum wage in Ontario and a lot of employees are going to have a shock when their employer reduces their hours or number of employees. “

Scare tactics. Who’s going to do the work? If the work needs to get done, then the employers will hire people to do it. Employers don’t hire people to sit around, even with generous tax policy. A fair tax system may very well create even more economic growth, which will improve both demand and supply.

If anything, if you increase taxes on many of these occupations/professions that extensively use the loopholes, they’ll probably work even harder to maintain their income and lifestyle. Working harder, from the perspective of a small business owner, might mean expanding a business, investing in technology, employing more people (presuming they can be productively employed. There is little evidence to suggest that high tax rates cause people to work less hard. If anything, the economy’s performance in this era of lower tax rates has been absolutely awful compared to that of the higher-tax rate eras.

#159 BC on 08.27.17 at 10:36 pm

Taxes are the price we all pay to live in a civilized society. You want roads and infrastructure? Be happy you can pay taxes to get them. . .or avoid paying and let’s all go back to the dark ages.

#160 SI2K on 08.27.17 at 10:39 pm

The IT people doing this are middle class. Under six figs is usual, and corps like the big six banks force them to incorporate, so as not to have to hire them onto pensionable jobs. There is a ton of risk, no employment security, no benefits. Large numbers of new Canadians occupy these contract/self incorporated IT jobs, also, in a way where I’ve had a sense that racial bias is a factor. It does seem like an overreach into classes of people that are purportedly supposed to benefit.

Personally, I gave up my doctoral level career to do books for a spousal business, bc the income was better than university teaching, and there was no daycare available in the GTA at the time. Minor detail, the Great Canadian Daycare Debacle, still not fixed despite blowing a lot of hot air. Someone has to hire talented women and have it be okay that we literally can’t leave the baby, Ph.D. in hand, due to no available child care.

Women should have choices and flexibility. I understand that this is at least on the table with these changes, but I’m not seeing where this doesn’t ultimately force many in precarious positions based on other precarious positions into unemployment.

This is a Liberal viewpoint, imo. I simply don’t think these guys are of an economic class or gender to truly understand the issues on the ground for women and new Canadians.

#161 Irish Stew on 08.27.17 at 10:41 pm

Soon, it may be easier to just be poor and stay at home or work that minimum wage job for $15 per hour.

#162 Entrepreneur on 08.27.17 at 10:41 pm

I am not in favour of income sprinkling when the spouse does not work. If I was the one handing out the money I would not want my money misused.

Bwts, one has to be careful that the spirit of small business is not killed as they are the engine of an economy.

The leaders have to give incentives to encourage small business not abuse them to extinction like with more taxes.

This is another reason why T2 should not be in power as he does not understand how the economy grows and blossom.

#17 Dan T…Liberals have been in power for 16 years here: Gordon Campbell 8 years; Christy Clark 8 years. And small businesses have been closing and leaving the province for about that time. And our economy has been on the hot housing market. That tells you everything about the Liberals.

Will never vote for a Liberal and did not vote for T2 and never will. Nor will vote for Conservative. Both the same control freaks.

Nice of the Accountants to speak up.

#163 45north on 08.27.17 at 10:45 pm

That’s not just the opinion of this pathetic blog. Most tax experts and accountants studying the proposed legislation have tossed their cookies. They cannot believe any sane government would launch a wholesale attack on the risk-taking entrepreneurs who create 50% of all jobs.

in other words: government is launching a wholesale attack on the risk-taking entrepreneurs who create 50% of all jobs

I’m afraid Bill Morneau has done his homework. He’s probably done focus groups. You know people sit around a table and listen to “middle class tax fairness” and then the moderator asks them their opinions:

do you think tax fairness is important?
do you think that the government could do more to improve tax fairness?
do you personally know any small businesses that do not pay their fair share of taxes?
do you support a move by the government to improve tax fairness?
would you be more likely or less likely to vote for such a government?

there’s a kind of deception with these questions: the people sitting around the table don’t know much about taxes – they buy Turbo Tax, plug in a few numbers and then hit submit. But as far as Bill Morneau is concerned, it’s a winning strategy. “winner winner chicken dinner”

sending emails to Bill Morneau is kind of dumb – he already knows it’s a winning strategy. Worse it doesn’t address the real problem: most people know very little about taxes, less about the proposed changes and less again about their impact. That’s the way he likes it.

How about an education campaign:

scene: an office, a dozen people in the office, a guy in the office, in his fifties, balding, he’s reading a paper: “small businesses will no longer be eligible for the lower tax rate”. He says it again. Then he says: “we’re not going to bid on the next subway contract. It’s just not worth it. In fact once we finish with Downsview Park. We’re going to close down”. Camera pans around the room. Nobody’s happy.

scene: small factory, a dozen people. Guy in a suit reads a paper: “small business can no longer invest its profits into new equipment”. Says it again. He goes on: “So we can’t buy the 3D printer and pay the taxes. Basically we’re out of business. The big companies have them and we don’t.”

#164 Entrepreneur on 08.27.17 at 10:48 pm

I think a lot of the voters came from legalizing marijuana and that is how T2 got in. So all the other leaders just have to “I will legalize marijuana” and if that get in before election time say “I will legalize all street drugs.”

#165 Jas on 08.27.17 at 10:53 pm

Language alphabets are symbols to express ourselves….
But sometimes, even they fall short of expression….
So dear readers I like to use additional symbols for expressing my views:

F#@* all that.
Get the [email protected]$&*&!$ out in the next election.
The F!#$&^@# kid we have elected…. oh !! Kick his effing Butt in the next election.
There !!!

#166 bob on 08.27.17 at 11:02 pm

It is not true that Canadian Tax payers heavily subsidize doctor training after medical school. As it is, the school already costs about $20K/year.

Residents get paid $35K/year… but they work about 80 hours a week… providing a service (e.g. night-time call at hospitals)… that without them, you’d have to pay a full-time doctor 5X more to do.

It would be interesting to see the math on this, but I’m willing to best, tax payers break even. At worse, residents may actually be saving tax payers money.

I mean, why would hospital doctors who can work 9-5 be willing to work the graveyard shift without substantial increase to benefits? There’s a huge difference being on call versus being at the hospital 24-7 for 1-2 weeks at a time. It just isn’t possible. You’d then need all specialist to work like ER doc shift work.

as Garth would say… good luck with that.

#167 BC on 08.27.17 at 11:04 pm

#102 Big Heart on 08.27.17 at 8:43 pm
The spouse of a risk-taking small businessperson is intimately involved in all aspects of the enterprise by virtue of the household and family sacrifices involved. Paying her $16 an hour as you might a casual employee is improper. — Garth

You almost made me grab some tissues. I have to think really hard when was the last time you were so poetic.

When you and your wife have lived such experiences you will realize how petty your words sound. — Garth
__________________________________________

As a civil servant (police officer) do you know how much my wife has had to sacrifice for all the crap I bring home from work? She gets paid $0 for this. So cry me a river Garth. Ambulance drivers wives, soldiers wives, teachers wives, the list goes on and on. Get real. The “small business owners wives” do not hold any exclusivity over sacrificing for free. You try to preach women’s rights and are too short sighted to see this glaring inconsistency in your reasoning?

When you mortgage your house to buy a cop car, let me know. The thread is about financial risk. Thank you for your service, though. Seriously. — Garth

#168 M-cube on 08.27.17 at 11:09 pm

Not really a con job. The money goes into the public coffers.

The real financial con job is the government regulators who allow systematic front-running of orders to buy or sell stocks, bonds, and derivatives by the likes of those computerized pirates called High Frequency Traders.

They are in nasty cahoots with the so-called prestigious exchanges and the alternative trading venues – all with the goal of draining capital from the people who actually put their capital at real risk.

Billions and billions of dollars of wealth is drained every year from all of us through our pension funds and our investment portfolios.

This con job makes the tax changes your complaining about look like amateur hour.

#169 BoomerKid on 08.27.17 at 11:09 pm

There are people who net benefit from taxpayer money and people who net pay taxes. Naturally, those who benefit (“Benefiters”) want more taxes and those who pay (“Payers”) want less taxes.

“Benefiters” include:
– government workers, MPs, civil servants
– seniors and students
– poor or unemployed

“Payers” include:
– wealthy elite
– working, upper middle class
– middle class
– working poor

To appease the large voting population of benefiters, the government overspends on pet projects. To pay for this they need to increase taxes to the payers.

The wealthy elite are untouchable because they include Justin and Morneau and their friends and people (and the large corporations they control) that donate to politicians.

So they tax the working, upper middle class (eg. successful entrepreneurs, lawyers, doctors, accountants). Eventually the upper middle class shrinks as taxes are a major disincentives to work.

The government still needs more money as the growing number of benefiters want more benefits and the shrinking number of payers stop working as much. They don’t have enough upper middle class to tax, so they move onto the middle class…And so forth until they eventually get to the working poor.

Then everyone is poor and doesn’t work and wants benefits that we can’t afford to pay for because no one works.

Voila – Venezuela!

Taxes are disincentives. We need to tax things we want less of in society (eg. cigarettes, alcohol, flipping houses) and incentivize things we want more of (eg. hard working people, entrepreneurs). If Bill and Justin truly want to address the wealth gap, tax inheritances. Inheritance is a major way in which the wealth gap is perpetuated and often doesn’t encourage people to work/produce more. But of course they wouldn’t do that because they both benefit from that.

Taxing entrepreneurs and professionals is simply a tax grab built on the politics of tax warfare.

#170 BoomerKid on 08.27.17 at 11:12 pm

Sorry typo – I mean “class warfare”.

#171 Bob dog on 08.27.17 at 11:23 pm

Corporations in Canada pay half the income tax actual people do. Thats also far less than us companies pay.

Sounds like the 1% are getting uppity because they can’t exploit the system as much as they usef to.

Companies pay taxes at a combined federal-provincial rate of about 30% on the money left after paying employees like you, who pay tax on it. The profits are are then reinvested in the operation or paid out to the shareholders, who pay tax on it. — Garth

#172 #nomoretaxesmorneau on 08.27.17 at 11:31 pm

hey, happy to send Mr. Morneau an email but wondering who else I can CC on it for some extra oompf?!? let’s harness the vast reach of this blog & social media to let Morneau, Trudeau and pals know we are not pleased, not pleased at all.

#nomoretaxesmorneau

#173 Edmonton on 08.27.17 at 11:40 pm

CONGRATULATIONS Mr. Morneau! Finally, it’s about time!!!

I emailed him to offer my full support and Thanks!

#174 hawkeye on 08.27.17 at 11:49 pm

Most Canadian business people are honest and pay there taxes as laid out by the government tax system 50 years ago. The planned changes will result in and force many deals to go underground and the result will be very little tax gain for the government. I will Fix your toilet do you need an invoice or cash

#175 ww1 on 08.27.17 at 11:51 pm

#166 bob on 08.27.17 at 11:02 pm
It is not true that Canadian Tax payers heavily subsidize doctor training after medical school. As it is, the school already costs about $20K/year. Residents get paid $35K/year… but they work about 80 hours a week… providing a service (e.g. night-time call at hospitals)… that without them, you’d have to pay a full-time doctor 5X more to do. It would be interesting to see the math on this, but I’m willing to best, tax payers break even. At worse, residents may actually be saving tax payers money. I mean, why would hospital doctors who can work 9-5 be willing to work the graveyard shift without substantial increase to benefits? There’s a huge difference being on call versus being at the hospital 24-7 for 1-2 weeks at a time. It just isn’t possible. You’d then need all specialist to work like ER doc shift work. as Garth would say… good luck with that.

As I pointed out earlier, there is no shortage of very qualified people wanting to get into Canadian medical schools. And yes, while Canadian tax payers do in fact subsidize a lot of the cost of medical school and undergrad degrees, IMHO it’s a good use of tax payer money.

So no matter how much they might hate me saying so, Canadian doctors are civil servants and the only difference is how they are get paid. So no tax breaks for them. Bonafide entrepreneurs deserve the tax breaks – they are getting screwed as the government goes after the more egregious examples of tax evasion.

#176 Lee on 08.27.17 at 11:57 pm

#153 Leo,

Not on a full pension. She probably knew with a full pension she’d lose some OAS so she retired a bit early. At five years early the pension is 10% lower which is probably the money she’d get clawed back on OAS if she was fully funded. Or she paid 2-3% more into the plan each year to retire early. Or maybe she started at22-23. My point is at a start date of 25 you’re fulky funded at 60. Either way, I have no pension so in working to 70.

#177 Caleb Landry on 08.28.17 at 12:04 am

#98 – Creating new business activity that didn’t exist before and collecting $20,000 in GST off my own efforts is still a tax benefit to the treasury. What part of creating something out of nothing do you not understand?

Would you rather my business not exist and not pay forward the $20k in GST? Is that what you are really trying to say?

#178 Another Albertan on 08.28.17 at 12:09 am

It seems to me that a lot of people simply aspire to a lifestyle beyond their normal means’ ability to pay. As a result, lack of past enforcement incentivized game-playing. In flipping properties. In structuring corporate and personal taxation. Ad nauseum.

Did anyone really think that the government wasn’t going to eventually extract their pound of flesh? As long as the economy kept on moving upward, enough people continued to get fattened up. Over-heated economies yield high velocities of money. Housing did that. Oil did that. Lack of enforcement or correction emboldens…

This is a shearing after the animals have been gathered in an inescapable corner of the pen.

There will be collateral damage, to be sure. But there always is… Wrong place at the wrong time. Not wearing any clothes when the tide goes out. A dollar short and a day late.

If there was ever a bell that was rung at the top, this is it.

This will crush some people. It was also, conversely, open up a new set of opportunities, as the landscape changes. I’m betting on my company’s ability to capitalize as this unfolds.

Everyone else’s mileage may vary.

#179 Pete on 08.28.17 at 12:17 am

I don’t understand this madness by attacking small businesses. There has to be a reward for taking a risk and working hard. I would of expected this move by the CONs even though Liberals are CON lite. I sent Bill another email. Amazing that they do reply back in time. If you stay civil.

#180 Leo Trollstoy on 08.28.17 at 12:17 am

Nice separation of poor wage slaves and the wealthy in the posts today

#181 fishman on 08.28.17 at 12:22 am

There seems to be a few people on here that have never incorporated or run a company. They seem to be pretty knowledgeable about how once one is incorporated one can dodge, lie, steal their way to prosperity by cheating the CRA. Having my original company over 30 years & incorporating a couple more along the way I can assure any neophytes out there that this is entirely possible. Just follow Al Capone’s advice & find yourself a crooked CA.

#182 Angie in Victoria on 08.28.17 at 12:27 am

My doctor is in his mid 50’s and works only 3 and a half days a week and I have to wait a month or longer for an appointment. I know of other docs (GPs) who work 4 days a week. With these new tax changes, perhaps he’ll have to put in a full week, like the profession used to, and I’ll not have to wait so long to see him. Just a thought…

#183 domain on 08.28.17 at 12:29 am

Well at lest the Marxists didn’t need a violent revolution – the millennial SJWs just simply voted in the Bolsheviks this time. I knew they were going to be a dangerous lot with their demographic dominance.

I have no idea what the plan should be now, but I will do what I can to pass this assault on my finances directly to my local economy through austerity in my household and knock out about 20-30k of discretionary spending.

There needs to be proper feedback so that the idiots who voted for these guys who are willing to execute the postmodern agenda can feel the pain as the malicious consequences of their agenda take hold.

This is happening so much faster than I thought. God help those of us who earn our living the risky way when the next crisis rolls ashore while the liberals are torpedoeing small business at the same time they are running 30 billion dollar deficits.

I don’t have a cynical enough imagination to picture what a federal response to a crisis in these conditions would look like other than even more confiscation of private property via taxation, or maybe just a friendly bail-in to finish off those with some capital left in the banks.

#184 meslippery on 08.28.17 at 12:31 am

“Combine these changes with the increase in minimum wage in Ontario and a lot of employees are going to have a shock when their employer reduces their hours or number of employees. “
——————
Ok look
Did this job 45,years I always loved it back in the day Worked for a oil company was $14.75 a hr in 1975 good money in the day no rules no problems just went too work did or jobs people even liked us then. Not so much anymore they hate us now they just seem to get stupider & stupider must be the air retired now wasn’t by choice but I can’t say that I miss it much
———————
eslippery says:
Your comment is awaiting moderation.
August 27, 2017 at 9:46 pm

Check this out $14.75 in 1975 is worth ??
Wait for it $68.62
So driver shortage? Ok
I think I am not there yet.
That’s not a raise that’s just inflation (Cost of living)
https://www.saving.org/inflation/inflation.php?amount=10&year=19

#185 Jon B on 08.28.17 at 12:34 am

Just read the comments being posted here. Truly polarizing. Clearly class warfare is on the horizon. Hating the wealthy and successful among us is a long time cherished Canadian value.

#186 Kilt on 08.28.17 at 12:39 am

Not really surprising Accountants are against the change, they will likely lose business.
Maybe they should leave the system the way it is, and give the middle income earners a 10% reduction in taxes. We all pay too much anyway.
So, what if your small business is a corporation? Do these new rules only apply to sole proprietors and partnerships?
Kilt.

#187 Pete from St. Cesaire on 08.28.17 at 12:48 am

“whom is going to pay for all those Govt workers who retire at 60 and go buy their 250K RVs or their house in Mexico with pensions”
—————————————————————
Govt workers should beware that in the not too distant future it will become politically expidient to change tax laws again to reduce pension payouts to people who spend much of their time outside of Canada. Hey, all the liberal folks will consider them to be the ‘rich’; and by then they will truly be the only ones with much money left so they will be forced to pony-up their “fair share”.

#188 aa3 on 08.28.17 at 12:54 am

Keep working.. millions of Canadian government workers are depending on you for their next raises.

#189 Niko Sheppard on 08.28.17 at 1:03 am

The responses from fellow blog dogs that approve of this proposal isn’t surprising… it’s concerning nonetheless.

Over the last few years there has been a great deal of “evil corporation” talk. People don’t realize that some of the largest companies in the world started out only a few decades ago as a bunch of buddies with a dream (Apple, Google, Microsoft,…). It worked out for them… they now employ thousands of people, stimulate the economy to no end.

Thousands of small business across the country are no different… just smaller, local, growing and hiring. .. paying taxes and committing millions to other businesses.

If businesses (small and large) were people they would be called “heroes”.

Now because of this anti-business sentiment it has given birth to stupid policy in the womb of unthinking liberal “do gooders”.

As a final point:

To the police officer who argued his wife has to put up with his stress. … I don’t disagree. Remember police pensions are some of the most generous in Canada… the incorporated professional has none. Taxing a business owner like a police officer makes little sense if the goal is equitable taxation.

Likewise, to the people who say “cry me a river” to the person making 400k / year … remember it takes a lot of hard work, they don’t go home at 4:30 and work 37.5 work weeks with a pension. Even if they can take vacation, it isn’t four weeks per year. Finally, they didn’t enter the work force at 19 or 20… often a decade later.

So if you want equitable taxation you really need to lower business taxes.

#190 Vancouver in the Rearview on 08.28.17 at 1:10 am

#166,

You are flat out wrong. The Canadian taxpayer heavily subsidizes the cost of physician education. Average tuition for Canadians is closer to $13,000 per year (AFMC 2015), and the actual cost is closer to $50,000 per year. That is a pretty heavy subsidy.

You are also wrong about wages for residents. In BC, residents are represented by a union – wages start at $50K per year, plus benefits, and top out at $80K per year for an R7. It is not $35K per year.

You are also wrong about what hospital management would do without residents. It’s already happening in the US, and to a far lesser extent, here in Canada. You hire Nurse Practitioners at 1/3 to 1/4 the cost. They can do 80% of the work with the same outcomes, and you can hire way more of them. More doctors aren’t the answer. More providers who offer services at a lower cost are the answer. The evidence convincingly shows that NPs can do the same work as a GP at far lower cost. So in an era of strained health budgets, why aren’t we doing this? Follow the money….

#191 Lookinin on 08.28.17 at 1:16 am

Garth, I’m rather sickened by the lack of understanding that so many posters have for entrepreneurs. Thanks for taking some of these morons back-of-the-envelopes calculations to task. Sheesh.

#192 Viorelli on 08.28.17 at 1:27 am

Robert from Richmond: ” I know a commie when I see them, just closed my warehouse, let go five floor guys and two office girls. Moved the whole operation to Taipei, cheaper to operate, less taxes, less rent, access to more consumers, more profitable, less headache and without commies after me! Lucky I stayed a dual citizenship, my kids will continue living here as they still need English and fresh air, after that goodbye. I wish luck to Canadian people and their government, they are nice people but many will see themselves turn into Cuban or venesuelean unfortunates within a decade or two. We, however in Asia will be just fine.

#193 jim on 08.28.17 at 1:37 am

#82

“you get a TN Visa, simple and easy, and could become even easier with the new Trump lead Nafta changes.”

Not likely. There is a lot of political pressure here to make it more difficult to get these visas. Given that Trump has been screwing over his base (or rather, the turncoat fake republicans like Paul Ryan), he isn’t likely to drop the ball on something that he actually has control over.

“then you amend your status, with an option to come back and forth,”

You do realize that this is not easy, right?

If you go the H1B route, you have to contend with the massive lottery in place. Not every applicant is guaranteed an H1B. You could spend 2-3 years just getting one of those, if at all.

(Hint: Trump has cracked down on H1B applications).

The other routes can be arduous as well, and time consuming.

“the process takes start to finish 5 grand, and 3 years”

3 years? Is that on average? You can’t put a firm number on this, as it depends on many factors beyond your control.

Have you actually achieved US permanent residency? You don’t appear to have gone through the process. (I have).

#194 jim on 08.28.17 at 1:41 am

#167

“When you mortgage your house to buy a cop car, let me know. The thread is about financial risk. Thank you for your service, though. Seriously.”

Don’t thank a police officer for their ‘service’.

They are, along with other public sector union members, the biggest opportunists around. California, Ontario, Illinois (etc) are in deep financial straights because of their ilk. I suggest you check out what they can make in California. (Hint: they can easily outearn engineers and lawyers).

Policing isn’t even in the top 20 most dangerous jobs in the USA. Farming, fishing, and natural resource extraction are all far more dangerous. Thank a farmer who feeds you, not a public sector union member who racks up his pension to obscene levels by claiming tons of pointless overtime.

#195 Looney Baloney on 08.28.17 at 2:10 am

Dear Leader,

Thank you once again for showcasing to the world, and especially to our neighbours down south, how a glorious, progressive and forward-thinking nation built on social justice, gender parity and carbon taxes thrives.

We dodged the GFC. Our housing market is insatiable. Our cities are world class and everyone wants to find refuge here. Our currency is strengthening even as oil & resources, the lifeblood of our economy, is crashing.

And now, nearly 50 years later, we are nearing the final stages of realizing daddy’s vision and cleansing our nation of its filth – those rich parasites masquerading as entrepreneurs and sucking the life blood out of our loyal voting block – deadbeat single moms, drug addicts, money launderers, and welfare bums. Nothing can stop us now.

My only regret is these archaic dinosaurs who are the final roadblock to our utopia of achieving a 100% (state run) economy, true gender equality and wage parity based on needs, not abilities, are not being taxed at 110%, yet.

Forward, comrade! (over the cliff)

#196 Concerned on 08.28.17 at 2:13 am

How about they tax the middle class LESS! And they ACTUALLY budget what they get from all sorts of taxes. It scares me how many geniuses approves of this!

#197 Suburban Guy on 08.28.17 at 2:27 am

$70,000 electrician? Are you kidding? Try 2x or 3x that. No contractor that I know of takes cheques (who even uses them these days) or credit cards. Contractors are paid in cash. In addition, every expense imaginable is put on the company’s tab. A friend ran an aesthetic studio for years. High end Oakville. Yup, facials, pedis, etc, all expensed on company credit cards.

#198 Suburban Guy on 08.28.17 at 2:35 am

I’ve read some several interesting analyses that with a small tax (1%-5%) on all financial transactions, income tax could be eliminated.

#199 AfterTheLion on 08.28.17 at 3:04 am

Trudeau seems not to know this quote from Teddy Roosevelt:

It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.

#200 Freedom First on 08.28.17 at 3:27 am

The squeeze is on for Canadians. I’m doing everything I can to help. More and more all the time. This is also getting more and more interesting. There is many very clever people out there.

#1
Freedom First
Master of Freedomonics
Its my life

#201 George Hampton on 08.28.17 at 3:30 am

I’m young. I can’t wait to leave this country. They’d rather promote transgenderism in children and Marxism in universities than leave people alone to spend their own money as they please.

#202 Dave from Kincardine on 08.28.17 at 4:54 am

Thank you for Bill’s email address. Accountants complaining about their clients being unfairly treated. That is a laugh. Talk about unbiased opinion. Nice try. I praised Bill for having the guts to put things correctly with a level playing field. Who do you think pays for all our wonderful social programs!!! As for making it look like the entrepreneur is making minimum wage like his employees, some are making much more so screw that argument. You have holes in every one of your points and it shows. A strong middle class is key. Corporate loop holes do not make a level playing field.

#203 Canuck on 08.28.17 at 5:34 am

Can’t wait to see just how bad things get under Trudeau.

All this just for pot. The tattooed, foot/sock fetish #selfie PM is in over his head.

#204 Stan Broock on 08.28.17 at 5:35 am

Any consulting contract with federal or provincial governments, either direct or through an authorized agency (specially these that require RFQ and RFP) requires by law incorporation as independent consultant.

This is reflected in the actual contracts.

This comes with lawyers fees, independent liability insurance, lots of liability actually, provision of tools at own expenses etc.

The same for doctors and professional corporations.
The additional expenses and nature of these Businesses as well as the lack of benefits requires incorporation.

The very suggestion that corporations are established in order to avoid taxes are laughable and Bill M knows it.

Is he trying to get rid of independent incorporated consultants so the big consulting firms occupy the space in an oligarchy (including his own firm, NO CONFLICT OF INTEREST HERE I guess dear brain-frozen brainwashed tundra dwellers?)

The disturbing part is that they go beyond that, they want to tell the owners of small private corporations to whom and how much to pay in salaries.

The lie-berals.
1. the above does not apply to large private or public corporations, i.e. Bill M and Trudope buddies.
2. There is no increase in taxes for stock options (again not to distress Bill M and Trudope buddies.
3. Mister fairness does not say a word about the lack of capital gains taxes on private residences.

Fairness, my behind.

As for the general lie-beral depending on handouts public: if you believe that somebody will wash your behinds and provide you with cheap quality services, your are deeply mistaken.

90 % of the government projects (the real work) is driven by independent consultants.

That will be outsourced to big companies Like the one that screwed the Obama Care health site (a big Canadian company) due to lack of competence so they were booted out and Accenture had to fix the miss.

Good luck in getting government and health services in the future.

#205 Happy with Moeneau on 08.28.17 at 5:39 am

I have noted many “corporate” folks from Alberta who own cottages in BC have the cottage in their “corporation ” and the mtgs to buy the cottages has been written off as a corporate expense against earnings. Other people not in a corporate holding situation, but just a regular cottage owner must rent the cottage, take out a business license, do all the proper accounting for the rental in order to get just a few legitimate costs tax reduced. Mir ray is finally levelling the tax field. The families within corporate writeoffs get way too much money compared to to families not within that particular structure.

#206 Nortel on 08.28.17 at 5:40 am

Not sure why people get so excited over this. Canada is a socialist wasteland. Anyone with ambition goes to the USA. Canada just doesn’t matter. Never has never will.

#207 ANON on 08.28.17 at 6:38 am

…or it could be simply those pesky diminishing returns, per dude Occam.

#208 David Hawke on 08.28.17 at 6:56 am

WOW!!! From perusing the above comments it is apparent that Canuckistan is screwed!

As #123 wrote “Harper’s arrogance followed by $enator Duffy’s arrogance …..led to their political downfall in the last election….” means the Cons have only themselves to blame for this current idiocy.

Sure glad that after 30+ years as a small business owner employing up to nine people at any one time, I had the smarts to leave for the tropics where one doesn’t need a million $+ to live a decent life.

Just want to thank all the above commentators who have no clue what a small business owner goes through for the heads up that my minuscule OAS/CPP payments will likely be history before I croak so that I can rank up my small business hobby of running a B&B/hostal to take up the slack.

#209 ArcticOutback on 08.28.17 at 7:32 am

Disgusted to see the disdain of some posters (trolls) applauding the upcoming tax grab. It clearly displays that people just can’t do math. A big side effect will be the talented leaving and the underground economy growing.

#182 Angie in Victoria on 08.28.17 at 12:27 am
My doctor is in his mid 50’s and works only 3 and a half days a week and I have to wait a month or longer for an appointment. I know of other docs (GPs) who work 4 days a week. With these new tax changes, perhaps he’ll have to put in a full week, like the profession used to, and I’ll not have to wait so long to see him. Just a thought…
——
You do realize that if self-employed Doctors have to spend around 10-15 hours per week doing admin work such as updating charts/notes/requisitions. Plus billing/chasing rejected billing/ accounting&general business operation stuff. Plus many run clinics/Emerg call,etc at different locations. Even if your Dr doesn’t do this, if they want to have a somewhat regular work week they need to earmark time for the admin stuff

#159 BC and #167 BC:
You do realize that we are already taxed to the hilt with income, property and sales taxes. Self-employed people generate and pay plenty of tax already. Plus we all pay PST/HST on everything we buy. People like you don’t worry about paying high taxes and not having enough left over to save for retirement though, as you are set with your 40 hour work week, generous vacation/sick day/indexed pension/benefit package.

#210 Dharma Bum on 08.28.17 at 7:39 am

WOW!

A lot of hand wringing, drooling, jealous readers coming out of the woodwork to comment on this post.

It’s sad how misinformed and ignorant so many people are.

Typical though. These low-end scumbags don’t care about elevating their own economic and financial circumstances, as long as they can see the hard-earned incomes of those that are smarter and more ambitious than they are being dismantled by a corrupt and spendthrift government.

#211 ArcticOutback on 08.28.17 at 7:48 am

The response below is done so well – the only things missed is that the underground economy/black market will thrive, some will work less while they wait for a real Government to return to power and their will be a brain drain/capital flight to more reasonable jurisdictions. The ‘fair share’ Liberal narrative is very scary to me.

—–
#97 Justtiredandretired on 08.27.17 at 8:35 pm
This sums it up quite nicely

Dear Mr. Morneau,

I’m curious to know why you believe it’s in Canada’s best interest to discourage business and encourage socialism.

It is my opinion that your discussion paper proposing changes to the taxation of small businesses completely misrepresents the facts, and it’s hard for me to imagine what your objective is. Hundreds of thousands of Canadians have spent their entire working lives building this country, and yet under the banner of “fair” you set out to destroy their businesses, and ultimately, their retirement plans. In many cases you’re not simply changing the rules; you’re changing the entire game.

In your discussion paper you talk about what the government stands to gain from eliminating income splitting and increasing the tax rate on passive income within corporations, but nowhere do you quantify the cost. Have you and Mr. Trudeau thought about what the cost of your proposals will be?

We’ve heard from business owners all across Canada and regardless of the business, they all agree that higher taxes means higher costs. Higher costs that will ultimately be borne by consumers — it’s just that simple!

In the discussion paper, you use an example of neighbours who each earn $220,000 per year. Have you looked at the statistics? According to Statistics Canada less than 2.35 per cent of Canadians make $220,000 or more per year.

What you have failed to do is describe the difference between an employee and someone who’s taken a chance and gone into business for themselves.
You are trying to convince the Canadian public that all business people are rich and that they use all these tax loopholes to reduce or avoid. What you have failed to do is describe the difference between an employee and someone who’s taken a chance and gone into business for themselves.

In the discussion paper, on page 13 you introduce us to Jonah and Susan. Jonah has a private corporation and Susan is an employee. You state that Susan’s household pays $35,000 more income tax than Jonah’s, and that just isn’t fair.

I’ve taken the liberty to outline the differences between being a self-employed private business owner and employee. Let’s look at the job description for a private business owner:

Variable income not guaranteed
No job security or workplace accommodation
Must personally guarantee company/business debt
No Employment Insurance (EI) coverage
Canada Pension Plan (CPP) coverage at twice the legislated employee cost
Hours extremely variable (can vary from 0 to 90 hours per week). Must be willing to work additional 20 hours or more a week without notice. No overtime pay.
No paid holidays
No paid parental/maternity leave
No paid bereavement leave
No extended health, dental or insurance benefits
No employer matching retirement program
Statutory holidays will not be covered
Should you require additional employees for completing your work, you shall be personally liable for:
guaranteeing they have a steady and reliable minimum income
covering 58 per cent of their EI cost
covering 50 per cent of their CPP cost
meeting all statutory labour requirements for work hours, overtime hours and pay, holiday leave and pay, statutory holidays and parental/maternity leave.
accommodating them for any limitation preventing them from completing the work they are providing you
damages should you no longer require their assistance

Now let’s talk about Susan the employee. Let’s say she’s one of your deputy ministers. A federal deputy minister makes about $220,000 per year. What else would they be entitled to? Correct me if I’m wrong, but I think it looks something like this:

Employer’s pension contribution up to $25,000
Employee benefits $6,000
Employer CPP contributions $2,569
Employer EI contributions $1,170
Up to eight weeks of vacation (worth) $33,846
10 statutory holidays (worth) $8,461
Up to 15 sick days per year (worth) $12,692
All of these entitlements add up to $89,738.

Did I miss anything? I’m not sure if I should add anything for employer paid parties, food and drinks.

Whether it’s a physician or a plumber, it makes no difference. All businesses take risks.
It looks to me like the extra $35,000 that Susan is paying in income tax might not represent the full picture. When including the almost $90,000 in benefits that she is entitled to that a business owner is not, she is in a much better position than the example you used to justify your changes and might actually be better off than Jonah.

You can’t and shouldn’t be allowed to compare an employee with an employer. What makes Canada great is having individuals who are willing to put their financial lives on the line to start businesses and employ those who chose not to take the chance. Whether it’s a physician or a plumber, it makes no difference. All businesses take risks. What you’re proposing strikes directly at the heart of small business. If Canadians really understood what the facts were I don’t think they’d be inclined to support your proposal.

I ask, on behalf of all Canadians, kindly leave the current integrated tax system alone and honour the system that was put in place by your party 45 years ago.

#212 2 Cents Canadian on 08.28.17 at 8:08 am

#187 Pete from St. Cesaire
“Tax pensioners who live elsewhere.”
They aren’t rich … Mexico is the closest place to us where a Canadian can exist on Canadian pension amounts. How does an adult live on $600-$1000 per month in Canada? And if in the GTA or YVR? …… fu-ged-abou-dit! …… even if your house is paid off?
And please don’t confuse living with existing.

#213 Ezzy on 08.28.17 at 8:14 am

All those people who gleefully support this bill belong in the Great Canadian Lobster trap (it’s a “joke” that defines the thinly veiled disdain many bitter Canadians have for those who are more successful than them). LOL LOL LOL GO TEAM CANADA!

#214 Reality 1 on 08.28.17 at 8:28 am

If implemented as envisioned, this new tax plan could be a real NEGATIVE for the value of residential real estate and smaller commercial buildings.

Some effects;

1) more income uncertainty = less confidence in buying (especially higher end homes and small commercial buildings)

2) more taxes paid = less after tax income = lower prices can that can be paid for housing

3) selling homes to lock in tax free gains to provide flexibility in their newly challenged business finances

4) rental smaller commercial buildings prices drop – fewer tenants in business or that can pay the overheads (surplus of commercial space)

5) owner occupied business premises price drop – businesses closing as owners retire earlier

6) business owners’ homes sold as business earnings drop necessitating lifestyle retrenchment

7) businesses down sized or closed = job losses = fewer qualifying buyers

That’s for starters.

#215 Ponzius Pilatus on 08.28.17 at 8:28 am

#38 Christopher Mewhort, EA on 08.27.17 at 6:02 pm
I have written to Mr. Morneau explaining that I am a tax accountant and that I fully support his proposals.

You are a accountant in the U.S. — Garth
—————-
This is getting silly.
Remember who accountants are working for.
Not the average Joe.
BTW, no more CAs, we’re all CPAs now.

By federal law, all accountants have as their primary client the CRA, not the taxpayer. This is why tax lawyers are thriving, since only they can promise confidentiality and a duty of care. — Garth

#216 Jay (not that one) on 08.28.17 at 8:38 am

Perhaps the tax rate for all small business owners ought to be lowered. However, keeping in tax loopholes creates two classes of people: those who are willing to be unscrupulous for tax reasons, and those who are not. It seems in total opposition to conservative values to say that people who are less scrupulous ought to be taxed less.

A fundamental tenet of Economics is that you tax things that you don’t want, and you don’t tax things that you do want. The message that you’re sending, and the message that the government is sending by continuing to have these loopholes is that the government wants fewer scrupulous business people, and more people who are willing to lie for a dollar.

If what you really want is to promote people to get into small business, then create a specific small business tax deduction and incentivize creating small businesses rather than lying on your taxes.

#217 Reality 1 on 08.28.17 at 8:51 am

If the delusional posters here supporting this confiscatory tax plan are indicative of the envy / jealously and dislike for those more successful than they, then it might be unwise to be displaying wealth and flaunting bling.

Years ago in Copenhagen on business, I asked some quite wealthy acquaintances why there were so few expensive vehicles there.

Every one of them told me it wasn’t the cost (246 % price of same vehicle tax free in Belgium !!!), but the SOCIAL APPEARANCE aspects that precluded them from personally buying. (They all loved cars and a few had vintage cars in their garages)

Top end BMW and Mercedes were regularly vandalized and the young women thought they were ostentatious and boorish, not emblems of ‘success’.

“Don’t stand out” I was told – it’ll only attract “unwanted attention and complications”.

#218 Eks dee Sipal on 08.28.17 at 9:23 am

Both sides of this debate are whiners. Sure, there are tax loophole cheats a-plenty. But there are also lazy, unambitious weed-monkeys a-plenty. I don’t really see the difference between them. One group has been accustomed to cheating on taxes (legally or illegally is of no substance to me) and the other cheat themselves more than anyone else but what’s the difference in the long-run?

Any economic system based solely on greed will ultimately fail. As we are witnessing right now, the divide between the rich and poor in this country is probably ‘terminal’.

The only solution is the same one that I started with on this blog many years ago: Stop electing banker puppets. It’s that simple. Everything else is noise.

#219 Eks dee Sipal on 08.28.17 at 9:27 am

Why doesn’t the government have no money? Who is it borrowing from? Why are these questions never asked and therefore never answered? Well, I know why. Do you?

#220 Eks dee Sipal on 08.28.17 at 9:28 am

*any* money

#221 Prairieboy43 on 08.28.17 at 9:28 am

Feds will collect < $$ Billion annually with this tax. Loose thousands of jobs, and votes. Government broke with $ 30 billion defecits annually. Liberals need to look in the mirror. You are the problem. Get out Government bonds ASAP.
Smokey has Right idea. Sell everything, leave observe from the beach. Wife and I are thinking about it. Year end in September. Accountant and I will long discussions.

#222 SpicyInTheBushes on 08.28.17 at 9:31 am

I’m reading through Moreau’s taxation scheme document, and despite my second coffee my eyes continue glazing over. Could someone smarter than me clear up a simple question:

If they do go ahead and tax investment income on retained corporate earnings… does this apply to new investments only (after 2017), or ALL investments held by the corporation, past and future?

All, of course. — Garth

#223 Lee on 08.28.17 at 9:42 am

#215,

By the time the lawyer gets the file the damage has already been done. The tax filings are the tax filings. The CRA has those. All the lawyer has is a file with some legal letters of advice in it and a photocopy of the accountant’s file (which is not confidential because the CRA can just get it from the accountant). Most people cannot do sophisticated tax filings using lawyers alone. Accordingly, once the CRA is on to you you are as good as screwed.

#224 2 Cents Canadian on 08.28.17 at 9:46 am

The government has stiffled big business ….. now they’re stiffling small business. Where are we all going to work? We all can’t work for the government. And if we’re all working in the food industry for $12/hr …. who’s going to come and buy our burgers? (besides people on gov’t assistance).
You have to create and environment where one will risk starting they’re own business. And if they do well …. tax them reasonably and leave them alone. The nay Sayers all have the same opportunity ….. and if you don’t have the guts, balls and drive to go it alone … then piss off and leave the ones who do (and did) alone. Most small business owners do not make a ton of money. So a few tax perks here and there sometimes keep them from giving up. They aren’t (and can’t be) collecting UI.
And don’t beat up the doctors …. every single one of us could have tried to be a doctor. its a hugely long, arguous and expensive process to get there …. and you had to be very good at maths and sciences in school.
Doctors represent less than .003% of Canada’s population. There is no amount of money you could take from doctors (even 101% of their income) that would make a dent in Canada’s tax raising needs.
You have to create and environment that spawns creativity and NEW business ….. not just going down the list of the few business and professions left who somehow are still making money and stripping dollars out of them.

#225 SWL1976 on 08.28.17 at 9:50 am

I don’t have the time to comment on here like I would as I am too busy juggling two small businesses and employing and handful of people.

It is sad to read the comments here and understand that some mindless brainwashed government serfs think that I am a tax cheat for doing so. Makes me think of the advertising pictures I seen in the bank (depositing cash – declaring my income no less) yesterday of all the mindless hipsters celebrating debt.

The idiots have clearly taken over the asylum

#226 BoomerKid on 08.28.17 at 9:54 am

#166
“You are also wrong about wages for residents. In BC, residents are represented by a union – wages start at $50K per year, plus benefits, and top out at $80K per year for an R7. It is not $35K per year.

You are also wrong about what hospital management would do without residents. It’s already happening in the US, and to a far lesser extent, here in Canada. You hire Nurse Practitioners at 1/3 to 1/4 the cost. They can do 80% of the work with the same outcomes, and you can hire way more of them. More doctors aren’t the answer. More providers who offer services at a lower cost are the answer. The evidence convincingly shows that NPs can do the same work as a GP at far lower cost. So in an era of strained health budgets, why aren’t we doing this? Follow the money….”

—–
Umm, a nurse practitioner starts at $80,000 and averages $100,000 or more with benefits and pension. So I’m not sure why that would save money compared to residents who you said yourself start at $50,000 and average around $65,000 (almost no one gets past $80,000).

Residents get extended health benefits (most are young and healthy so generally don’t benefit much from the benefits), but they do not have pensions.

Plus, a nurse practitioner will work 40 hours a week. Anything overtime is paid at time and a half. I haven’t met a single resident who works 40 hours a week. I would say 80 hours is the average. The “overtime” call stipend in Ontario is just over $116 for a 24 hour weekend shift “in-house” (means you can’t leave the hospital), which last time I checked was $4.83/hr.

And while NPs are well-trained in their own way and have an important role in the health care system, I don’t believe any can do surgeries, run a trauma or a code blue, intubate a baby who can’t breathe, or read an MRI…all services covered by residents. Sure, NPs are well-trained to see some patients and write reports and they do it very well, but as a hospital admin/government bureaucrat why not make the resident add 10 more hours to their 80 hour work week and do that for free?

#227 Stan Broock on 08.28.17 at 9:54 am

#211 ArcticOutback on 08.28.17 at 7:48 am

You are wasting your time.
The corrupted headstrong lie-berals have already decided on this one.

They are intentionally arrogant, part of the game folks, part of the game to show you (the upper middle class) your place.

Part of the larger game plan to divide and conquer for the benefits of the big Businesses/the real owners of this place only.

Around 1000 people in Canada.

#228 Manitoba Whale on 08.28.17 at 9:54 am

Caleb Landry on 08.27.17 at 8:00 pm
Why don’t we all pile on and tell her that she’s a piece of crap for having done something successful?
*****
The average person cannot relate to someone taking home 20-40 times what they themselves take home. But if you make 2-4 times more than they take home watch out: crabs in a bucket. They want you down to their level because of ‘fairness’.
If a hockey jock makes 8 mil, let’s get his card and sweater; if my plumber with the ill fitting pants makes 150 grand, well that’s just not fair!

#229 BC on 08.28.17 at 10:08 am

#167 BC on 08.27.17 at 11:04 pm
#102 Big Heart on 08.27.17 at 8:43 pm
The spouse of a risk-taking small businessperson is intimately involved in all aspects of the enterprise by virtue of the household and family sacrifices involved. Paying her $16 an hour as you might a casual employee is improper. — Garth

You almost made me grab some tissues. I have to think really hard when was the last time you were so poetic.

When you and your wife have lived such experiences you will realize how petty your words sound. — Garth
__________________________________________

As a civil servant (police officer) do you know how much my wife has had to sacrifice for all the crap I bring home from work? She gets paid $0 for this. So cry me a river Garth. Ambulance drivers wives, soldiers wives, teachers wives, the list goes on and on. Get real. The “small business owners wives” do not hold any exclusivity over sacrificing for free. You try to preach women’s rights and are too short sighted to see this glaring inconsistency in your reasoning?

When you mortgage your house to buy a cop car, let me know. The thread is about financial risk. Thank you for your service, though. Seriously. — Garth
___________________________________________

I know a teacher personally who spent $15,000 over several years setting up her classroom. She did not get back a penny of that money. I know a lot of other teachers who complain about having to spend their own money on classroom supplies too. Can the ambulance driver mortgage his house to get over PTSD too? Because I know a couple of them that would consider it.

#230 joblo on 08.28.17 at 10:09 am

Ya why waste time writing to your MP’s.
Even if they read them which I doubt, some flunky replies they don’t care.
T2, Mourno aren’t in control. The big money is.
Wake up folks, ya think the next election matters?
Spend your time wisely on work arounds. Try and stay one step ahead.

#231 KLNR on 08.28.17 at 10:10 am

#116 Mattl on 08.27.17 at 9:12 pm

HAHAH, well put.

#232 Ace Goodheart on 08.28.17 at 10:33 am

We now have the very interesting problem in Canada of government sponsored deflation.

Earnings are worth less due to never ending tax increases. Houses are worth less due to price killing measures. Everything you buy today will be cheaper tomorrow.

This seems to be what happens when interest rates rise. Taxes go up (to service the debt) and prices go down (people can’t afford to borrow as much due to being taxed more and paying more interest).

In a high interest rate environment stuff is cheap but no one can afford anything.

#233 Tazi Bnu on 08.28.17 at 10:39 am

I think a possible workaround to continue sharing income with your spouse is to divorce and then remarry. Most Family and divorce law would would allow the spouse to take ownership of half the business. You would just have to hope that family and divorce law supersedes tax law, but I’m not a lawyer and this should be read with a grain of salt.

#234 Manitoba Whale on 08.28.17 at 10:44 am

#151 Spock on 08.27.17 at 10:19 pm
If Justin applied for a job at my business he will not even get minimum wage due to lack of employable skills and I doubt most employers would hire him because last time I checked “able to take selfies” is not a qualification which most businesses require.
*****
Maybe we can start a new meme for our esteemed PM. He does have some strong qualities.
-Would you hire Justine Trudeau?

#235 nick on 08.28.17 at 10:47 am

#159 BC on 08.27.17 at 10:36 pm

Roads existed before tax. Pick up a book.

#236 Karlhungus on 08.28.17 at 10:52 am

I’m shocked to see so many commentors so jealous of small business owners. You think it’s such a walk in the park? Try it for yourself then….such backwards thinking to make it even riskier to start small businesses.

#237 WUL on 08.28.17 at 10:53 am

I am buckling down to try and pull the fat from the fire for my retirement. I have a bunch of carry forward RRSP room and with some fancy footwork, this might work. I won’t bore you with the details.

Brave and uninformed opinion here. I am keeping my powder dry for a while as the markets will slide, in particular the Dow. Much of what we have seen in terms of its gains since November 8 are due only to the Trump Bump and his proclaimed legislative agenda. First and foremost was the lowering of corporate taxes.

Hah. He will fail completely on all of his legislative initiatives and folks are waking up to that.

Elect a clown? Expect a circus.

#238 Manitoba Whale on 08.28.17 at 10:56 am

BC on 08.27.17 at 10:36 pm
Taxes are the price we all pay to live in a civilized society. You want roads and infrastructure? Be happy you can pay taxes to get them. . .or avoid paying and let’s all go back to the dark ages.
*****
Yes…but are you not at all concerned about why we are so far in debt as a nation? With lack of restraint of the public purse by any party, will this not lead to crankiness about how much one has to pay for it? Lack of confidence in a leader and their policies does not yield in a desire to pay more taxes.

#239 Jesus on 08.28.17 at 11:00 am

As much as I like Trudeau for his socially progressive ideas, electing a former teacher was a mistake.

Trudeau had everything handed to him via his father. He’s never had to make payroll once in his life, or take a financial risk.

#240 Old Ron the Realtor on 08.28.17 at 11:03 am

TO BLOG DOG JAKE

“So, here I am – what do I do now. Frankly, if you push this through, I’m packing my bags and won’t be looking back.”

Please don’t let the door hit you on the way out. After another vacuous political rant from a $400,000 a year refugee, I have to wonder if perhaps we can dispense with some of the guest columnists. Just a suggestion Garth.

By the way JAKE, higher taxation is going to get worse, not just in Canada, but everywhere in the G-7, and it has nothing to do with political party , and everything to do macro economics. Your Mecca (The USA) depends on Trillions of Dollars of Government and Fed support to keep the lights on. The difference between them and us is that they are slightly more willing to kick their $20 Trillion can down the road. At some point revenues will have to catch up to expenditures, then presto, you have appropriate levels of taxation.

Hate to step outside of my normally mild “Old Ron” personality, but this political partisan stuff is getting as old as me.

#241 nice while it lasted on 08.28.17 at 11:06 am

Canada is from public servants and for public servants. It is a communist country where entrepreneurs were allowed to setup shops.

Someone wrote further up that public service “workers” get to retire from age 50 onwards.

If you’re not on that gravy train, I suggest to get on it or leave.

#242 Cool story, Bro on 08.28.17 at 11:26 am

Jake – Cool story, bro. So you say you “muddled along” for 400K/yr? Interesting. That’s over 7 times the average Canadian salary. What praytell are the rest of us doing for 55K/yr?

#243 aa6 on 08.28.17 at 11:29 am

If you compare Canada’s economy to say Britain or France, let alone Germany or America.. Canada looks more like a developing country.

We do low end outsourced functions for multi-national corporations, and we sell resources, but besides that its not like we have a bunch of multi-national corporations based here.

#244 TJ on 08.28.17 at 11:31 am

#55

Agree totally. Have seen many instances of corporations unfairly avoiding taxes, especially medical and dental practices– this blog’s categorization of this measure as an eat the rich tax grab is disingenuous. Corporations that already play within the rules will not affected. Sorry Garth, everyone should pay their equal share.

Corps that ‘play within the rules’ will indeed be seriously affected, since the government is arbitrarily changing those rules. Imagine if that happened to your paycheque, or if your RRSPs were suddenly made taxable. — Garth

#245 changes are confusing on 08.28.17 at 11:32 am

The biggest issue with these proposed changes is that once government singles out a group for alleged fiscal benefits, they are opening the proverbial box of Pandora.

How more changes will be coming? Who would expand an existing business let alone start a new business with the very real threat of a government looking for ways to increase taxation on the profits of that business?

If Canada was a “real” country, there would be one health care act across the nation. Not every single Province doing their own thing. The physicians, nurses and staff would be paid according to a set federal tariff.

ALL Doctors are paid from one single employer as it is now. Why give them the option to setup a corporation to avoid taxation. Just pay the Docs their fair wage according to a competitive pay scale.

The Feds are just creating more problems with their proposed tax changes. This could have been addressed allot quieter and within the group of tax payers who are affected by this.

But ultimately the question remains.

Where does it end? Who else are they after?

Doctors were allowed to incorporate in some provinces in lieu of a pay increase, not to ‘avoid taxation.’ Do a little research. — Garth

#246 aa6 on 08.28.17 at 11:32 am

One bright spot for you guys.. here in BC I would say 90% of people who make over $100k in total compensation work for the government, or work for a subcontractor to the government.

So each year the government decides to give each other generous salary increases. But the only people that have money to tax to pay for those increases, are the government workers and subcontractors.

#247 Cool story, Bro on 08.28.17 at 11:36 am

Do you know why average Canadians decide to quit being wage slaves to major corporations and the government? Because they realize they can make more than 55K/yr (that’s 33K after taxes!!! And NO PENSION!). Considering it myself!

#248 Matt on 08.28.17 at 11:39 am

Focusing on the income splitting with one’s spouse aspect:

This reminds me of the same change the Conservatives did where they allowed income splitting for households where one spouse earns the lion share of the income. The Liberals were quick to remove that when they got into power but now they are bringing back the much less palatable version where everyone gets taxed!

Like everyone on here, I want a fair solution and I saw the equity in the way the Cons did it. I feel like that was a simpler and better approach. This solution is too complicated and over-reliant on bureaucracy.

#249 Alex Brothers on 08.28.17 at 11:39 am

Hey Garth – Bill shut down his email address. Blahaha

#250 Ace Goodheart on 08.28.17 at 11:42 am

One of the biggest shorts in history currently developing down in California. Not sure if people can see this. The options market prices are leading me to believe that they don’t.

What is the one thing a company needs to remain on the plus side of market valuation?

Answer: earnings per share.

There is no way in this universe that they can ever make even a dime of profit. I’ve run the numbers again and again. There is just no way. The most massive tech wreck in the last 20 years is spinning up into the mother of all crashes.

#251 Timberrr on 08.28.17 at 11:56 am

#131 Spock

You should be thankful the contractor gave a person of your intellect a job due to which you and family (if you had anyone dependent on you) could survive. So instead of calling the contractor names be thankful you are in a position to post your pitiful thoughts on this blog.

————————————————————

Typical right wing cheapskate ahole. The contractor got a sweetheart deal from a government insider buddy and screwed the workers who were all experienced tradesmen except half the team were retired double dippers who were happy with 25% less the going tradesman rate and wouldn’t step up and demand proper wages or walk.

This “you should be happy to have a job” bullshit is why they are now going after small businesses who scam the system. I was about to underbid the contract renewal and give everyone a raise until the government took the jobs back into the union where they should have never left and we got a 30% raise plus full benefits etc.

#252 George on 08.28.17 at 11:59 am

Yes, I have a corp. I do split income with wife, who is taking care of home but she had to give up her job so now there is a spot in the market for someone else to take it. We are considering she will go and work again if we have to pay more taxes. It is a nonsense proposal from this government./

#253 45north on 08.28.17 at 12:06 pm

Reality 1: If implemented as envisioned, this new tax plan could be a real NEGATIVE for the value of residential real estate and smaller commercial buildings.

1) more income uncertainty ✓

2) more taxes ✓

3) selling homes to lock in tax free gains to provide flexibility in their newly challenged business finances
✓ ( never thought of that )

4) price drops on smaller commercial buildings – fewer tenants in business or that can pay the overheads (surplus of commercial space) ✓

5) businesses closing as owners retire ✓

6) business owners’ homes sold as business earnings drop necessitating lifestyle retrenchment

( after some thought, you get the check )

7) businesses down sized or closed = job losses = fewer qualifying buyers ✓

I think the Liberals don’t have a clue. We’re talking 50% collapse in real estate prices. Minimum.

#254 Victor V on 08.28.17 at 12:06 pm

Toronto detached homes dip below $1M, but will it lure buyers back?

http://business.financialpost.com/personal-finance/mortgages-real-estate/toronto-detached-home-prices-dip-below-1m-but-will-it-lure-buyers-back-to-the-market

#255 Vancouver in the Rearview on 08.28.17 at 12:07 pm

#226,

You are right – I conflated residents with hospitalist physicians and that was a mistake. There is no comparison between NPs and residents. Totally different setups, roles, and responsibilities.

#256 Keith in Calgary on 08.28.17 at 12:10 pm

Our tax rate should be cut to 15% of gross income for everybody. Individuals, corporations, trusts……everyone.

Remove every and all form of deductions. Have a simple three line form.

Put consumer price controls in place, and watch economic growth go thru the roof.

#257 Tazi Bnu on 08.28.17 at 12:10 pm

“The last time Canada brought in huge tax code changes they were researched and debated for six years. This time it’s 75 days. In the summer. When people are on holiday. Including all the MPs.”

This is the biggest problem with this tax reform/grab, that they are not adequately consulting any experts with any debate or time to digest it. They have woefully underestimated how many people this will effect, and consequently woefully underestimated the effect on the economy. This will be a burden on far more than just the professionals, doctors, lawyers, accountants, as they have currently predicted. It will effect:
• Electricians
• Pipefitters(They do natural gas pipes in your house)
• HVAC Installers
• Movers
• Plumbers
• Contractors
• Odd job workers
• Electrical and Telecommunications Contractors
• Line Men
• Restaurant owners
• Franchise owners (almost every big business you buy from is probably on a franchise model)
• Guys like those on Deadliest Catch, if domiciled in Canada
• House Inspectors
• Engineering Inspectors
• Yoga Instructors
• Personal Trainers
• Dog Walkers
• Animal Kennel owners
• Daycare owners
• Crop Dusters
• Farmers (every item of food was touched by a small business)
• All freelance workers
• Mechanic shop owners
• Auto dealers
• Tool and die shops
• Owner Operators (Truck Drivers)
• Surveyors
• Dietitians and Nutritionists
• Naturopaths and Health store owners
• Physiotherapists
• Gas station owners
• Everyone who showed up on Dragon’s Den
• Window cleaners
• Landscapers
• And many more but I think the point has been made
They are rushing this large tax reform with no proper consultation or committee, and no beneficial impact for the “middle class,” which they still have yet to define. To act on this scale without knowing the impact that it will have just shows an incompetence that no Canadian Government before them had, with regards to taxation. I think fantastically irresponsible is an understatement, willful blindness doesn’t seem to fit either.

#258 BoomerKid on 08.28.17 at 12:25 pm

#55

Agree totally. Have seen many instances of corporations unfairly avoiding taxes, especially medical and dental practices– this blog’s categorization of this measure as an eat the rich tax grab is disingenuous. Corporations that already play within the rules will not affected. Sorry Garth, everyone should pay their equal share.

Corps that ‘play within the rules’ will indeed be seriously affected, since the government is arbitrarily changing those rules. Imagine if that happened to your paycheque, or if your RRSPs were suddenly made taxable. — Garth

——

This is something employees can’t seem to understand. Because contractors and small businesses do not have pensions, etc. the government gave them the ability to defer taxes to create pensions for themselves through incorporation tax laws. This was both legal and intentional. Now the government is suddenly saying that they are going to tax those incorporations at the highest marginal personal tax rates.

The equivalent for an employee would be if you’ve been saving for the last 20 years into an RRSP with the plan to retire with them. Now the government says “hey, I know you’ve been saving into your RRSPs but it’s not fair that small businesses and contractors don’t get those, so in the name of ‘tax fairness’ we’re going to tax everything you’ve saved in your entire RRSP at the highest marginal personal tax rate of 53.5%”. Your retirement savings would be effectively decreased by a little more than half. If you were planning to live off $50,000/yr in retirement, you would now be living off $25,000/yr. That is why entrepreneurs, professionals, and contractors are understandably upset.

#259 BillyBob on 08.28.17 at 12:29 pm

Every day, more vindication for leaving the country. It’s kind of nice.

Life is short. It’s not about the money, but it sure is about the time these Liberal fools are stealing from people by their reckless policies.

I derive great satisfaction from the fact that I have not paid income tax in Canada in many years and never will again.

What I find bizarre is the Stockholm-Syndrome weirdos actually applauding this. How pathetic and frightened does your life have to be to think that trying to take from the bold so the mediocre can prosper, is a positive thing?

I’m not against paying taxes. But when a government is overspending by tens of billions a year, they can look elsewhere for their spending money, thanks.

You have my sympathies. This will not end well for the government or the country. I don’t mean this one set of measures, I mean this kind of loser mentality. Smoking Man nailed it: the status quo jobbers will never defeat the entrepreneurs. They just leave, find ways to overcome the measures, or stop trying. So all you’re left with is the weakest, the most unoriginal, the laziest, the most mediocre.

Perhaps this could be a new national slogan.

Oh, and Justin. Just come out of the closet, already! It’s 2017, no one cares if you’re gay.

#260 Gulf Breeze on 08.28.17 at 12:40 pm

I am a partner in a small incorporated business in the U.S and planning to remarry soon. My fiancé will be getting OAP and CPP. I haven’t looked into this issue with my accountant, so I don’t know if it will effect me or not.

To all other small business owners who bemoan the unfairness of it all, take a good look around. There are so many young people trying to stitch together a life working 2 or 3 part time jobs, in areas where prices have gone through the roof. They have zero chance of ever getting ahead.

I happily support Morneau’s fair tax measure. Anything I can do to help those stuck in economic chaos that they have little control over, I WILL do.

Ask yourself, you miserly AND ignorant few, where you would rather live, in the U.S or in Switzerland, Sweden, Denmark?

There is tremendous social cost if you choose the U.S. And remember, too, that the lower federal and state tax is often recouped through higher property taxes.

By all means, move to the U.S and enjoy living in a country with a death penalty, private prisons and a national debt that is unsustainable and consider the consequences.

#261 Mike on 08.28.17 at 12:42 pm

Garth,
>90% of Docs/Accountants/Consultants have no “small business”. It’s a professional corporation whose SOLE purpose is tax cheating and avoidance!!!

These so called ‘small businesses'(which they are NOT) have ZERO employees, except fake kids/spouse employees to issue FAKE paychecks and avoid taxes.

Truth is me as employee making $150k, pay more in taxes than the doc out there making $350k. I have no issue with them making more – but if I cannot sprinkle my income among my kids and spouse, nobody should. Cant even expense gas for going to work, but these ‘professional corps’ can expense their car payments and private dinners.

Good job Morneau!! Fairness.

Again, they are not small businesses. They are professional corps with ZERO real employees.

When have you ever been to a doctor’s office where there was no receptionist/admin person? Employees. Overhead. Such a load of crap on here today. — Garth

#262 For deleted much misaligned stock picker on 08.28.17 at 12:55 pm

#192-3……Right…..I left years ago…..I’ve been out CaNada so long and I still hear Canucks still bitching about getting ripped off . So leave already. In the past ten years alone I have been in Texas and Thailand…fantastic lifestyle. It’s true….being happy and successful drives Canadiansnutz…..I have lost friends and relatives over pool shots and beach resorts. Canada is a toilet for the truly idiotic who don’t have the balls to wake up and get out. Life is so much better elsewhere….are you just stupid? Anyway…..I going to Malta next…..same deal….15% tax……bottle of good wine in a nice restaurant is a fifth what you pay in Aca Nada….why……no TAX. What’s going to happen when taxes get to 100%……who’s the greaterfool…..the guy who calls it and does something…..or the guy who let’s himself get Trudeaued?

#263 dangeresque2 on 08.28.17 at 12:57 pm

Thank you Garth for highlighting the lack of consultation and for raising the awareness. I sent a message to Bill.

#264 Stan Broock on 08.28.17 at 12:59 pm

Corps that ‘play within the rules’ will indeed be seriously affected, since the government is arbitrarily changing those rules. Imagine if that happened to your paycheque, or if your RRSPs were suddenly made taxable. — Garth

———————————–

This act is just preparation for much more to come.

Imagine an announcement few year down the road, some other schmuck (maybe the same one) comes on TV one evening and says:

RRSP? It is gone folks. Expropriated/Nationalized or collapsed and taxed on marginal rate immediately.

Not gonna happen?

Watch and see people, watch and see…

They are coming for your money.. they think it is theirs….

#265 TJ on 08.28.17 at 1:08 pm

Corps that ‘play within the rules’ will indeed be seriously affected, since the government is arbitrarily changing those rules. Imagine if that happened to your paycheque, or if your RRSPs were suddenly made taxable. — Garth

——————–

Depends what you mean by arbitrary. If you mean that the Government did not think this out then I disagree….certainly the Dept of Finance studied this in depth and calculated the likely tax losses by maintaining the current system. If you mean that it was arbitrary by virtue of the fact that there was insufficient public debate then I think that is a fair point. The Libs likely saw an easy win with voters and wanted this implemented quickly to avoid the angry lobbying of those with vested interests…..

#266 Darryl on 08.28.17 at 1:13 pm

#169 BoomerKid on 08.27.17 at 11:09 pm
There are people who net benefit from taxpayer money and people who net pay taxes. Naturally, those who benefit (“Benefiters”) want more taxes and those who pay (“Payers”) want less taxes.
“Benefiters” include:
– government workers, MPs, civil servants
– seniors and students
– poor or unemployed
“Payers” include:
– wealthy elite
– working, upper middle class………………. ….shortened
——————————————————–
Well said . You are one smart boomer kid

#267 Spock on 08.28.17 at 1:20 pm

#158 Mark on 08.27.17 at 10:33 pm

I have my own business with employees and most businesses I know run on small margins. As I said before every action has a reaction.

Same like 2008 – a lot of companies laid off workers and never hired them back afterwards. 10 people were doing the work and now 7 people do 10 people’s work.

Time will tell but I have already let go 2 employees. Makes the other people work harder if they want to keep their jobs. Employees also now have to contribute 50% to the health benefits.

You are living a pipe dream if you think more taxation and cost for businesses is going to make business owners take more risk in order to keep their existing lifestyle.

————-

#158 Mark on 08.27.17 at 10:33 pm
“Combine these changes with the increase in minimum wage in Ontario and a lot of employees are going to have a shock when their employer reduces their hours or number of employees. “

Scare tactics. Who’s going to do the work? If the work needs to get done, then the employers will hire people to do it. Employers don’t hire people to sit around, even with generous tax policy. A fair tax system may very well create even more economic growth, which will improve both demand and supply.

If anything, if you increase taxes on many of these occupations/professions that extensively use the loopholes, they’ll probably work even harder to maintain their income and lifestyle. Working harder, from the perspective of a small business owner, might mean expanding a business, investing in technology, employing more people (presuming they can be productively employed. There is little evidence to suggest that high tax rates cause people to work less hard. If anything, the economy’s performance in this era of lower tax rates has been absolutely awful compared to that of the higher-tax rate eras.

#268 Spock on 08.28.17 at 1:23 pm

From all the comments on this topic – the conclusion that I draw from the people who are happy with T2 and Morneu is that they are jealous that their employers are making a lot more money than them (so yes – go ahead and tax them more) but do not have the guts or the capability to start their own ventures (would rather stay an employee) while hoping that they make same as what their employer does.

As an employee, you need businesses and employers around or you will be out of a job. So think twice before hoping that your employer makes less money because that petty mindset will cost you dear in the long run.

#269 Spock on 08.28.17 at 1:29 pm

#234 Manitoba Whale on 08.28.17 at 10:44 am

Maybe Garth can run a poll here -would you hire T2. I did hear he dances pretty well at the events. Also he is magician – give him a $ and it turns into zero . . . err.. negative . . *poof* and just like that it was gone.

#234 Manitoba Whale on 08.28.17 at 10:44 am

#151 Spock on 08.27.17 at 10:19 pm
If Justin applied for a job at my business he will not even get minimum wage due to lack of employable skills and I doubt most employers would hire him because last time I checked “able to take selfies” is not a qualification which most businesses require.
*****
Maybe we can start a new meme for our esteemed PM. He does have some strong qualities.
-Would you hire Justine Trudeau?

#270 AGuyInVancouver on 08.28.17 at 1:33 pm

#239 Jesus on 08.28.17 at 11:00 am
As much as I like Trudeau for his socially progressive ideas, electing a former teacher was a mistake.

Trudeau had everything handed to him via his father. He’s never had to make payroll once in his life, or take a financial risk.
_ _ _
Do you really think Trudeau is making up tax policy? he might give the go-ahead but this obviously comes from recommendations at Treasury and/or Finance. They’ve identifies a loophole, so it’s clear there has been some abuse of this.

BTW, with all the moaning about leaving Canada, I’m curious how the Excited States treats the same issue. Anyone know?

#271 Victor V on 08.28.17 at 1:44 pm

New mortgage rules could depress housing demand by another 10%: TD

http://business.financialpost.com/personal-finance/mortgages-real-estate/new-mortgage-rules-could-depress-housing-demand-by-another-10-td

#272 Stan Broock on 08.28.17 at 1:47 pm

#269 AGuyInVancouver on 08.28.17 at 1:33 pm

Here is an article on hiring your kids under 18th (Ouch child labour!)

https://www.forbes.com/sites/garrettgunderson/2016/02/20/see-the-irss-incredibly-generous-tax-benefits-for-hiring-your-own-child-part-two/#351c87472433

Does the strategy of setting up a separate family management company to pay your children add a little extra complexity to the strategy? Sure. But no more complexity than having to withhold and submit payroll tax. And if you have multiple children, the cost savings can be significant.

Is this an aggressive tax strategy? A so-called “conservative” CPA might say yes. However, it’s also perfectly legal if you do it right. You’re just changing the facts to match what the IRS code allows. Remember, the tax courts agree that individuals have the right to strategically use the tax code to their advantage and lower their tax burden.

The IRS doesn’t care if you refuse to use the tax code to your full advantage. And they aren’t going to help you find the strategies either. That’s up to you. The key is to have a qualified tax strategist set up the plan and show you the rules to follow. Then, as long as you document everything carefully, there is nothing to fear when using legitimate tax strategies.
————————————–
Hope Bill ‘the deaf email account’ takes notes.

#273 Stan Broock on 08.28.17 at 1:55 pm

When have you ever been to a doctor’s office where there was no receptionist/admin person? Employees. Overhead. Such a load of crap on here today. — Garth

—————————
A message to all entrepreneurs/risk takers/doctors:

These are the people (#260 Mike on 08.28.17 at 12:42 pm and Co) that you supporting with your hard work, employment positions and risk taking, including taxes.

Sigh.

#274 X on 08.28.17 at 1:57 pm

I thought the budget was supposed to balance itself.

Then I thought the 1%ers were going to pay more to cover everything.

Now the MD’s.

Next McD’s?

#275 Stan Broock on 08.28.17 at 2:12 pm

#260 Gulf Breeze on 08.28.17 at 12:40 pm

Nice try.

Switzerland, Sweden, Danmark, Germany all have family taxation. Income sprinkling or whatever idiocy Bill M and his bit advisers are coming up with do not make any sense and are unknown as topics/subjec in Europe.

No one else has the retarded canukistan taxation system where you are always at fault/at discretion of the auditor from CRA.

#276 World Traveller on 08.28.17 at 2:15 pm

The Trudope government, trying to turn Canada into Spain in 4 short years.

#277 Mike on 08.28.17 at 2:20 pm

Garth,
>90% of Docs/Accountants/Consultants have no “small business”. It’s a professional corporation whose SOLE purpose is tax cheating and avoidance!!!

These so called ‘small businesses'(which they are NOT) have ZERO employees, except fake kids/spouse employees to issue FAKE paychecks and avoid taxes.

Truth is me as employee making $150k, pay more in taxes than the doc out there making $350k. I have no issue with them making more – but if I cannot sprinkle my income among my kids and spouse, nobody should. Cant even expense gas for going to work, but these ‘professional corps’ can expense their car payments and private dinners.

Good job Morneau!! Fairness.

Again, they are not small businesses. They are professional corps with ZERO real employees.

———————————————
When have you ever been to a doctor’s office where there was no receptionist/admin person? Employees. Overhead. Such a load of crap on here today. — Garth

———————————————

Garth,

Please. Only person who employee that front desk and nurse is the clinic owner. Clinic owners are small(or big) business in real. Doctors working there are NOT “small businesses”, but professional corp owners who fake employee spouse/kids at home.

Front desk/Nurse is NOT employed by professional corp doctor. But is employed by clinic owner. Individual doctors who employee ZERO people(except spouse/kids for fake paychecks though) are not to benefit from “Small Business” title.

That is fairness.

Due respect. That’s what happens. Right or wrong.

#278 Can business owners have RRSPs? on 08.28.17 at 2:22 pm

Keep hearing that Dr.s and business owners don’t have pensions but can they contribute to RRSPs? Many employees don’t have pensions either BTW.

#279 Can business owners have RRSPs? on 08.28.17 at 2:29 pm

never mind, I asked google

http://business.financialpost.com/personal-finance/retirement/rrsp/why-business-owners-shouldnt-bother-with-an-rrsp

#280 n1tro on 08.28.17 at 2:53 pm

#100 Dr. Talc on 08.27.17 at 8:42 pm
I’m call BS on 90% of these comments supporting Morneau. It is impossible that this blog can mobilize so many lick lick, kiss kiss grovelling shits to email Morneau their support. These comments are paid shills, CRA employees; Morneau will soon be on TV that no one watches saying
“The public support is overwhelming”
———————————
I disagree. These are real people. Idiots. But real.

#281 crapload on 08.28.17 at 3:01 pm

When have you ever been to a doctor’s office where there was no receptionist/admin person? Employees. Overhead. Such a load of crap on here today. — Garth

How many of them are spouses?

If they perform the job, what business is it of yours? Sheesh. — Garth

#282 Stan Broock on 08.28.17 at 3:06 pm

#277 Mike on 08.28.17 at 2:20 pm

You are stupid and persistent, arn’t you?

Every doctors I have seen has its own receptionist.
Most family doctors have nurses.

Every dentist has its own receptions/few of them.

Stop trolling.

#283 Stan Broock on 08.28.17 at 3:12 pm

#281 crapload on 08.28.17 at 3:01 pm

My dentist receptionist was his wife. Pretty good at that, Family Business.

#284 NoName on 08.28.17 at 3:15 pm

Interesting stats and nice table and pi charts

http://www.ic.gc.ca/eic/site/061.nsf/eng/h_03018.html#point2-1

professional, health, accommodation and construction sector are only tree sectors that are growth net positive in small business category, table Births and Deaths of SMEs, 2013.
it will be interesting to compare this table to “new” table few yrs from now.

side note
That 70k electrician dude is only working casual part time.

What do electricians chant when they meditate?
Ω

#285 Ace Goodheart on 08.28.17 at 3:16 pm

It would appear to me that taxation functions on the hermit principle.

In any society when you are dealing with adults, there is a certain amount of things that we all say “that is the adult person’s own fault. We are not helping them with that”.

The more liberal the society the less we say that. In some cases it is simply unacceptable to say that so we never do.

The hermit principle would simply state that everything is the adults fault, no matter what and they’re not getting any help from the hermit. No shelter from the rain in this hermit hovel.

Taxation is the opposite of that. You earn money? Good. Other people need it more than you. The more liberal the government, the more money they will transfer from those that can to those who need with the ultimate left leaning form of government being communism (from each according to their ability to each according to their need).

Communist societies usually have little to no production of goods (because why bother if the government is just going to take everything you produce and give it to those in need?).

So the question is always how much can we force the hermit to become civilized and give away some of her stuff to those in need?

The principle breaks down of course if you have a hermit who is a global citizen, with an education recognized around the world and who is very mobile.

In that situation the hermit just leaves and finds a place that is less taxing to live

#286 Mike on 08.28.17 at 3:18 pm

To #268 Spock

Which grand venture is an individual doctor/accountant/lawyer starting…… except fake employing their own family to deduct on taxes?

So much for venture. Individual person doing their job is not a Venture.

#287 Gulf Breeze on 08.28.17 at 3:27 pm

#275 Stan Brook,

Nice try…but YOU missed the point. Sweden has very high income tax, as does Switzerland, Germany, etc…all civilized societies. My point wasn’t specifically about how they structure their taxes, just that personal income taxes are high relative to our own.

Those who want to avoid fair taxation by moving to a third world country, like the U.S, have to be prepared for all of the social ills that go along with being an unjust society, including their abominable health care system.

If your taxes are low and your food is cheap, where you choose to live, someone is getting screwed over and that could easily show up in crime stats, social unrest.

Be very careful where you choose to relocate while persuing what I (and many others) consider a very self serving definition of ‘fairness.’ It’s a motivator that has unintended consequences written all over it.

#288 mouldyinYVR on 08.28.17 at 3:29 pm

#250 Ace Goodheart
…right on the money – gone crazy
“One of the biggest shorts in history currently developing down in California…….
There is no way in this universe that they can ever make even a dime of profit. I’ve run the numbers again and again. There is just no way. The most massive tech wreck in the last 20 years is spinning up into the mother of all crashes.”
…..looks just like run up to dot.com crash……..

#289 X on 08.28.17 at 3:31 pm

#182 Angie in Victoria on 08.28.17 at 12:27 am
My doctor is in his mid 50’s and works only 3 and a half days a week and I have to wait a month or longer for an appointment. I know of other docs (GPs) who work 4 days a week. With these new tax changes, perhaps he’ll have to put in a full week, like the profession used to, and I’ll not have to wait so long to see him. Just a thought…

My guess is the opposite. Why work so much, when you keep less. Look at other countries like Denmark that are heavily taxed, the incentive isn’t really there to make more, or work more.

If Trump can ever get lower business taxes passed (or anything for that matter) why would a company want to operate in Canada with a rising tax burden?

#290 fancy_pants on 08.28.17 at 3:47 pm

to all the jack a$$e$ that voted in the circus, I hope you are all first to go bankrupt

#291 Ace Goodheart on 08.28.17 at 3:50 pm

#288 mouldyinYVR on 08.28.17 at 3:29 pm

“…..looks just like run up to dot.com crash……..”

Totally. I’m shorting forward to January 2019.

Just hoping when it blows up someone will actually be able to pay me. The options pricing is nutty.

By my calculations, the product cannot be produced for under around 60K US per unit. It is going to bleed money like it’s head just got cut off. This is going to blow sky high.

#292 Mike on 08.28.17 at 3:57 pm

#282 Stan Broock

No need to throw personal insults. I can call you the same. No issues.

Receptionists are employed by clinic owner, not doctor. Maybe one off, but mostly the clinic owner- not doctor.

If you dont know how it works, dont comment. I personally know people who work in the system, including clinic owners who are real businesses i agree and should get all tax benefits of running business.
But not individual doctors who just exploit it. They are not small businesses.

#293 fancy_pants on 08.28.17 at 3:57 pm

as I’ve said before, hard work is for losers. whoops. another coffee break calls, gotta run :)
thanks to all for voting me job security

#294 Stan Broock on 08.28.17 at 3:57 pm

#287 Gulf Breeze on 08.28.17 at 3:27 pm
#275 Stan Brook,

Nice try…but YOU missed the point. Sweden has very high income tax, as does Switzerland, Germany, etc…all civilized societies. My point wasn’t specifically about how they structure their taxes, just that personal income taxes are high relative to our own.

Those who want to avoid fair taxation by moving to a third world country, like the U.S, have to be prepared for all of the social ills that go along with being an unjust society, including their abominable health care system.

If your taxes are low and your food is cheap, where you choose to live, someone is getting screwed over and that could easily show up in crime stats, social unrest.

Be very careful where you choose to relocate while persuing what I (and many others) consider a very self serving definition of ‘fairness.’ It’s a motivator that has unintended consequences written all over it.

———————–

You be careful when spewing stupidities.

There is not fair taxation. Fair is subjective and I won;t accept it when it comes from you or Bill M.

There is just taxation, i.e. you get what you paid for including access to base services – health care, education, housing, ability to retire.

1. Switzerland has very low taxes. It is a capitalist country. very high pay, everything expensive. Top health care in the world. The nicest place on earth is not BC but Switzerland. See what the Alps are, drive to France or Italy, even Spain/Barcelona in a day.

2. Germany has higher taxes for individuals but much lower for families. Education is free, you have excellent health care, good pension, nobody works on the weekend, laid back culture where drinking beer in public is not a crime.

3. Denmark is expensive with highest taxes but again you get everything you need. Free education.

For none of the 3 countries above I have not heard about a single case where:
1. A smart person can not complete university
2. Retirement is mission impossible as is health care (how are these waiting times working in Ontario?)
3. People live in glass condos, moldy basements.

Come and see it yourself.

#295 n1tro on 08.28.17 at 4:07 pm

#182 Angie in Victoria on 08.28.17 at 12:27 am
My doctor is in his mid 50’s and works only 3 and a half days a week and I have to wait a month or longer for an appointment. I know of other docs (GPs) who work 4 days a week. With these new tax changes, perhaps he’ll have to put in a full week, like the profession used to, and I’ll not have to wait so long to see him. Just a thought…
————————–
You are so dumb. So if I wait a long time in line at the DMW for my renewal sticker, reducing the pay of the staff that services me will make them work harder?? Please don’t reproduce and spread your idiocy to the next generation.

#296 Stan Broock on 08.28.17 at 4:08 pm

#292 Mike on 08.28.17 at 3:57 pm
#282 Stan Broock

No need to throw personal insults. I can call you the same. No issues.

Receptionists are employed by clinic owner, not doctor. Maybe one off, but mostly the clinic owner- not doctor.

If you dont know how it works, dont comment. I personally know people who work in the system, including clinic owners who are real businesses i agree and should get all tax benefits of running business.
But not individual doctors who just exploit it. They are not small businesses.

—————————–
Excuse me, but stupidity has limits.

You can call me whatever you want, when I see stupidity I call it out.

Clinics? What clinics are you talking about?
If you work at a hospital as a doctor, you have salary.

Every doctor/dentist who has his own practice has receptionist/s on his payroll. Many family doctors have nurses.

They pay for office, insurance, cobsumatives, etc

#297 tccontrarian on 08.28.17 at 4:11 pm

“The last time Canada brought in huge tax code changes they were researched and debated for six years. This time it’s 75 days. In the summer. When people are on holiday. Including all the MPs.” -GT
—————————————————————-

Either this administration is a lot smarter (than the one which took 6 years), or this is short-sighted and agenda-driven with little consideration of what’s good for the average Canadian.

All I can say is, “I didn’t vote for them monkeys”.

TCC

#298 Smoking Man on 08.28.17 at 4:11 pm

Wow all the commies coming out of the woodwork

#299 Stan Broock on 08.28.17 at 4:12 pm

I really feel like in the movie ‘Idiocracy’ this evening. Even worse.

#300 James on 08.28.17 at 4:18 pm

#290 fancy_pants on 08.28.17 at 3:47 pm

to all the jack a$$e$ that voted in the circus, I hope you are all first to go bankrupt
____________________________________________
Which Circus the Northern one or the Southern one? Both are quite entertaining.
The Northern Circus is all about love, love , love, peace and pass me that joint! All the time your wallet is being raped by some smiling circus clown who will do selfies with you while he is screwing you. At the same time your asking yourself WTF did I actually vote for this clown!

The Southern Circus is all about hate, hate, hate war, and pass me that ammo! This orange coloured clown smiles a lot and tells you lies while you can actually see the truth behind him in living colour. When the truth behind him contradicts his lies he just lies more and smiles. Kinda creepy. At the same time your asking yourself WTF did I actually vote for this clown!
Either way they are both scary circuses.

http://www.express.co.uk/entertainment/films/836324/IT-movie-trailer-Pennywise-voice-The-Leper-Stephen-King-Skarsgard

#301 jess on 08.28.17 at 4:22 pm

intentional variation?
Alcohol content of Carling is lower than advertised, owner tells tax court (28 Aug 2017)

beer brewed at 3.7 per cent = less taxation than 4%
http://www.independent.co.uk/news/uk/home-news/carling-alcohol-volume-lower-than-advertised-tribunal-tax-hmrc-a7914731.html

#302 Mike on 08.28.17 at 4:28 pm

#296 Stan

After taking few insults from you, let me finally declare your stupidity has no limits. I call it out.

My close friend is a doctor(single so no chance of family paychecks, is all for Morneau rules). He has no receptionist on his payroll. None of the doctors in the clinic he works has any receptionist on their payroll. They are on clinic’s payroll, which is owned by 3rd party business owner who well deserves the tax benefits.

#303 Stan Broock on 08.28.17 at 4:38 pm

#298 Smoking Man on 08.28.17 at 4:11 pm
Wow all the commies coming out of the woodwork

—————————–
This is nothing.

Just wait until the next cultivated couch potato generation, product of the ”progressive” educational system comes out of school and/or universities.

But hey, they will know all 3/47/108 genders and the biggest prize in the Lottery would a selfie with the dear leader!

And we will be the biggest producer and exporter of transgender washrooms in the world, pretty good Business Eh?

#304 Entrepreneur on 08.28.17 at 4:39 pm

My stance on the hiring of T2: He would not get pass the resume pile and will get tossed aside. Too full of himself.

#305 Spock on 08.28.17 at 4:41 pm

#251 Timberrr on 08.28.17 at 11:56 am

The intellect level certain matches the name Timberrr.

I think living under union protection and off taxpayers money may have affected what happens in the real world.

#251 Timberrr on 08.28.17 at 11:56 am

#131 Spock

————————————————————

Typical right wing cheapskate ahole. The contractor got a sweetheart deal from a government insider buddy and screwed the workers who were all experienced tradesmen except half the team were retired double dippers who were happy with 25% less the going tradesman rate and wouldn’t step up and demand proper wages or walk.

This “you should be happy to have a job” bullshit is why they are now going after small businesses who scam the system. I was about to underbid the contract renewal and give everyone a raise until the government took the jobs back into the union where they should have never left and we got a 30% raise plus full benefits etc.

#306 Spock on 08.28.17 at 4:46 pm

To #286 Mike on 08.28.17 at 3:18 pm

If you have the guts and the brains, why dont you ask them yourself.

I would recommend asking the:

(i) doctor when you visit them for help with your treatment or getting well. I would suggest be forceful so that they give you the true answer. Demand it. Tell them that you thieves are just not paying your fair share of taxes. Make sure that the prescription receipt is signed off at the end.

(ii) Same for accountant but you would need income for getting an accountant to do your taxes.

(iii) Same Qs to the lawyer who is defending you in court.

Demand an answer.

#286 Mike on 08.28.17 at 3:18 pm
To #268 Spock

Which grand venture is an individual doctor/accountant/lawyer starting…… except fake employing their own family to deduct on taxes?

So much for venture. Individual person doing their job is not a Venture.

#307 Spock on 08.28.17 at 4:47 pm

#304 Entrepreneur on 08.28.17 at 4:39 pm

I think T3 has more than enough qualification and experience to be hired as a quality tester (QA) for the weed companies.

#304 Entrepreneur on 08.28.17 at 4:39 pm
My stance on the hiring of T2: He would not get pass the resume pile and will get tossed aside. Too full of himself.

#308 jess on 08.28.17 at 4:48 pm

bidding wars for data centers tax incentives…after reading this one might reconsider!

http://www.goodjobsfirst.org/sites/default/files/docs/pdf/datacenters.pdf

http://www.latimes.com/business/hiltzik/la-fi-hiltzik-apple-iowa-20170825-story.html

Do we consider whether it’s worth competing in the bidding wars between states for data farms, which have inflated incentives? A study last fall by the Good Jobs First nonprofit showed that the governments who lured data centers were spending roughly $2 million per job created.
http://www.desmoinesregister.com/story/opinion/editorials/2017/08/25/apple-data-center-tax-breaks-waukee/600606001/

#309 greyhound on 08.28.17 at 4:51 pm

Watermelon Man w/ woman’s face in hands is my favourite image of yours for months! I burst out laughing

#310 T-dog on 08.28.17 at 4:51 pm

I’ve worked for three small businesses, two were absolutely milking the tax system: Spouses that never stepped foot in the office. Hundreds of thousands of unreported income. Cash deals. Misreported income. Yeah, they took a lot of risk and worked long, profitless hours to get started. They earned their millions, but a spade is a cheating spade and this legislation will claw some of that back.

Hardly. Tax cheaers will continue to cheat. — Garth

#311 Sue on 08.28.17 at 5:07 pm

Hey wait a minute. Maybe this is part of nafta. We get the illegal immigants and refugees from the usa and they get our doctors lawyers and anyone else who has any ambition to succeed from us? Yes! Thats it. Trudeaus negotiating skills are showing….
Was it that good ol Maggie Thatcher that said something like the thing about others people money is that eventually you run out of it? I think we have run out. This is the tipping point for us. We will be raising our fees and cutting our hours. People need to step back and see the real problem. Government is a disaster. It hurts us all. We will all pay. First they will come for us but eventually government will have to take a cut too as we have run out of other peoples money.
God help us all.
We should be trying to solve this together as taxpayers instead of allowing the government to manipulate us to turn on each other.

#312 Spock on 08.28.17 at 6:19 pm

#310 T-dog on 08.28.17 at 4:51 pm

These new rules will not catch your former employers.

You should have called up CRA and told them about it once you left. Not sure if there is a reward for being a whistleblower.

#310 T-dog on 08.28.17 at 4:51 pm
I’ve worked for three small businesses, two were absolutely milking the tax system: Spouses that never stepped foot in the office. Hundreds of thousands of unreported income. Cash deals. Misreported income. Yeah, they took a lot of risk and worked long, profitless hours to get started. They earned their millions, but a spade is a cheating spade and this legislation will claw some of that back.

Hardly. Tax cheaers will continue to cheat. — Garth

#313 Robbie Mac on 08.28.17 at 6:47 pm

Great Blog Garth!

Sorry, I can only read through about 100 comments before my eyes glaze over…

1) I would never want a doctor’s life! They are earning their pay! – Especially if you include the bureaucratic medical systems (Alberta) that they have to work with… (It is Sick!)

I would rather see Doctors make more money – if that means that I get a few more minutes when I visit…

2) A guy quits a job paying $400K… That takes intense balls of steel… He can earn whatever he makes!

3) I have seen the inner workings of government close-up, in detail. Sometimes policy is planned. Often though, it is driven by the whim of an uninformed politician or senior bureaucrat – and then bureaucrats must jump through hoops to make it all look nice and somehow function – however badly… (I am not kidding…!) (This new policy appears to be driven by whim…)

Closing unfair loopholes is a good idea however, this policy looks more like a drowning man grasping at any branch – and finding the one that is just holding a big bolder back from falling…

When is the next election?

#314 OotDer Hoos on 08.28.17 at 7:01 pm

#285 Ace Goodheart

You said two dimensions and you completely missed a third dimension, which is Christian charity and decentralization, where the family is the cornerstone of welfare, and discipline against poor behaviour.

In this dimension, the “hermit” looks after his own immediate family and even his extended family, and does charity, and disciplines the drunks and lazy, and does not allow the communist government to replace all his responsibilities.

The atheist liberal-communists get away with not caring by wanting a central distance government to do the caring, instead. It is satan replacing the family and Christian responsibility with such a burden of taxation that everything must be done one way, the government’s way.

#315 DebtFree on 08.28.17 at 7:36 pm

You’re entirely correct on your views Garth… The Liberal government is quickly removing any incentive to create any sort of business in Canada.

Why risk it here when the rules are so much better abroad?

The comments on here crying for equality and fairness are laughable, and it really saddens me to know that these people have the ability to vote.

Skilled labour earns the benefit of earning MORE then non-skilled labour, simple economics. Risk takers, if successful, should earn more then their counterparts.

Keep up the good fight.

#316 Al on 08.28.17 at 9:51 pm

“Someone wrote further up that public service “workers” get to retire from age 50 onwards.

If you’re not on that gravy train, I suggest to get on it or leave.”

Yes you can start collecting db at 50 yo of age if you’re willing to flirt with the poverty line for the next 30-40 years (the remainder of your life) after living on $0 dollars for the previous decade while waiting for the db pension to kick in. Somewhat of an unrealistic scenario, especially the $0 between 40-50. The term gravy train might be a bit optimistic.

#317 Waldguy on 08.28.17 at 11:40 pm

Of course accountants are bitching. They’re losing their raison d’être. They pushed way too many people into situations where they take $1500-$2000 a year to fill out a fancy corporate return without good justification for doing so.

#318 AGuyInVancouver on 08.28.17 at 11:53 pm

OMG over 300 posts? Who knew there were so many whiny doctors, lawyers and CPAs! Newsflash, ordinary Canadians don’t feel bad for you losing your tax avoidance schemes.

#319 Buford Wilson on 08.29.17 at 6:03 am

The plural of Lexus is Lexi, Garth.

#320 Realitybytes on 08.29.17 at 9:02 am

“#52 Kallamazoo on 08.27.17 at 6:46 pm
#13 and Garth:

some of these so called entrepenuers

i know an engineer who created a corporation

has had the same sole client for 25 years so is essentially a defacto employee

client (i.e. employer) dodges payroll taxes, engineer dodges payroll taxes, writes off his truck and many other so called business expenses, shelters his defacto wages in his corporation and only takes out what he needs at a greatly reduced tax rate

where is the risk

and this same engineer whines about so called “cash for life” public empoyees and their pensions and that he pays too much in taxes

oh yeah and he lives in his parents basement and he is 60 years old

Not credible. Any contractor with a sole client is taxed as an employee. — Garth

Uh, maybe Garth. But I know several people who carefully keep two or three clients, two of which they are paid peanuts by, so they can benefit in all the ways this gentleman suggested. Indeed, one of them derives 90% of his $200K+ a year salary from two companies, and actually gets a rebate on his 13% tax rate from his incorporated firm because he charges his beer and skittles to his company, whether it’s for business or no. meanwhile my wife pays 40% of her 100K salary in tax and you are telling me it’s OK cos she’s a wage slave, where the other guy is a hell-for-leather, damn-the-torpedoes entrepreneur? Get over yourself.

Nobody makes a salary of $200K and pays tax of 13%. Get over yourself. — Garth”

Why are you being obtuse about this? (that means wilfully misunderstanding in order to deflect or mislead.)
I don’t like the proposed changes either, but denying that there are people who do take advantage is disingenuous.
I’ve been working with IT contractors for 20 years. The vast majority sole source their income, bill out over 150K per year, and pay far less than 20% back in tax all things considered.
Them’s just facts jacks.

Nope, wrong. The corporate tax rate is not the personal one. Learn more. — Garth

#321 Maxwell C. on 08.29.17 at 11:04 am

The bias here is ridiculous.

There is nothing, NOTHING, stopping the self-employed from contributing to their RRSPs in the same manner and rate as anyone else.

Also, the author acts like every single employee in the private sector has some sort of juicy pension (like the one he is sucking from the Canadian taxpayer as he writes it). This isn’t the 1950s, and that isn’t the case. Most Canadian employees have no, or a very scant, pension.

#322 Rebs on 08.29.17 at 11:20 am

To nail down the “cheaters”, what about just making more funds available for good old-fashioned auditing?

I’m completely honest on my tax returns (mostly due to ingrained/spiritual values) but also because I don’t want to have any audits being done. Look into the books of any suspicious small corporation and it should be easy to find the cheaters. Then, they can “pay their full share”, plus penalties and interest.

Seems to me that makes more sense than a full out crackdown on all business owners.