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PostPosted: Sun Sep 10, 2017 10:48 am
 


Public sector one-percenters are safe, but regular small biz owners take the hit

BY LORNE GUNTER , EDMONTON SUN


$1:
Did you go camping this summer? Did you stay, even one night, at a private campground?

Did the owner or her spouse check your family in, help you find your spot, sell you some basic supplies at the campground store, make change for shower tokens?

Did she or he seem “rich” to you?

Did you get the oil changed in your car at a neighbourhood lube shop before you left? Did the franchisee strike you as one of the “wealthy few?”

How about the guy who owned the diner and flipped those great burgers your family looks forward to every year on the way up to the cottage? Did he give off the vibe of a One-Percenter?

How about the growers you bought those amazing carrots from at the farmers’ market in cottage country. Did they seem like uncaring capitalists?

Sure, there are some small business people who have enjoyed tremendous success. They’ve taken risks, made some sacrifices, worked incredibly hard and enjoyed some luck. And now they are comfortable – some, very comfortable.

But before you start buying the class envy the federal Liberals are selling to justify their proposed massive increase in small business taxes, it’s important to know Prime Minister Justin Trudeau and Finance Minister Bill Morneau are deliberately trying to confuse the “rich” – the One-Percenters – and small businesspeople in our minds.

"Bill Morneau ✔ @Bill_Morneau
Replying to @Bill_Morneau
Our proposals are targeted only at specific loopholes. Most #smallbiz won’t be affected. Look for yourself: http://www.fin.gc.ca/activty/consult/tppc-pfsp-eng.pdf … 8/8"


To justify the largest tax grab on the middle class in more than a generation, the federal Liberal government is only too happy to mislead Canadians into believing that small business owners are wealthy tax cheats and greed monsters.

The truth is, two-thirds of Canadian entrepreneurs make less than $73,000 a year before taxes. That’s what a lot of teachers, nurses and police officers make.

One-third make less than $33,000.

There is nothing fair and compassionate about Justin Trudeau’s tax increase and @CPC_HQ will fight this every step of the way!

And unlike public-sector workers, these ordinary Canadian entrepreneurs don’t have great pensions, paid mat leaves, paid vacations, a dozen paid sick days a year and a host of other perks and benefits.

Out of the $73,000 they make before taxes, they have to save enough to enjoy a reasonable retirement. Do they sound like tax thieves to you?

Trudeau and Morneau haven’t, themselves, tried to confuse the small business owners they are about to squeeze with the infamous One-Percenters, but they have been only too happy to have others perpetuate the myth that small businesspeople are super rich.

Yet here are two realities that fly in the face of myths many resentful voters harbour towards entrepreneurs and the “rich.”

Most One-Percenters work for salaries – meaning they are executives or senior bureaucrats. They are not small business owners, nor do they live off investments, stocks and bonds.

And here’s the real shocker: They are almost as likely to be in the public sector as the private.

George Fallis, an economist at Toronto’s York University points out that in addition to senior partners in large law firms, specialist doctors, dentists and other professionals “most judges are in the one percent.” So are “the senior administrators of our hospitals and our universities.”

The largest provinces’ health care systems will all have dozens of One-Percenters on staff, perhaps hundreds.

“They are also the senior civil service and the top people in many quasi-public agencies,” Fallis points out. “The leaders of big-city museums, opera and ballet companies and symphonies are also One-Percenters.”

But only a tiny fraction of the true One-Percenters are about to get whacked for considerably more taxes the way the Liberals plan to hit the campground owner, diner owner, auto shop owner and farmers you met this summer.

The Trudeau-Morneau tax grab is all about government greed for revenues; nothing at all about fairness for the middle class.


http://www.torontosun.com/2017/09/09/pu ... ke-the-hit


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PostPosted: Sun Sep 10, 2017 12:01 pm
 


More on how the Trudeau tax plan targets small businesses here:

http://globalnews.ca/news/3726971/comme ... um=Twitter


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PostPosted: Sun Sep 10, 2017 12:41 pm
 


I thought Shit for Brains Sunny ways said budgets balance themselves [huh]


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PostPosted: Sun Sep 10, 2017 1:05 pm
 


In spite of the fact a lot of small business owners don't get the opportunity to use these loopholes and in spite of the fact it seems a lot of foregone revenue, these are the incentives to drive small business.
I'm partly self-employed and was 20 years fully self-employed and only ever got to use a few of those loopholes. That kept a service in our small town for 20 years, several people in jobs and me making enough to not give up and go work in a mill or something.
Hardly anyone considers self employment, everyone wants someone else to hire them.
Now there's an 800 number for the people running my old business.
And I still 3 years later get at least 1 call a day from ppl who can't read what Google pulls up and call me looking for them.

Dumb move JT


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PostPosted: Sun Sep 10, 2017 4:20 pm
 



________________

When Federal and Provincial leaders fail you. 8O


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PostPosted: Sun Sep 10, 2017 6:59 pm
 


Of course Lornes rant, like most right-wing rants doesn't provide you any actual facts or details of just what exactly these tax changes are. Like so much of the hot air that comes from the right these days, it's all just empty rhetoric trying to appeal to emotions. It's like one of those magazine ads that just has the brand name and a picture of a sexy chick but doesn't give you any idea of what product or service they're trying to sell or who they're trying to sell it to. They're just trying to invoke a Pavlovian response.

In fact the government has explicitly said the changes won't affect anyone earning less than $150k.

What exactly are the details of this tax plan? The government is closing 3 tax loopholes, which apply to all "self employed" taxpayers- every doctor, lawyer, dentist, high-priced consultant, investors, and realtors mostly benefiting high income earners. Don't let Gunther'a misdirection fool you- the impoverished businesspeople scraping by don't benefit much from these loopholes.

1) Pretending a poorer family member earned your income, aka "Income Sprinkling": This is the practice where business owners in high income tax brackets are currently alllowed to "sprinkle" some of their taxable income among family members in lower tax brackets on their tax return, even if those family members aren't involved in the business in any way. Does that sound like a struggling small business owner making less than $33k to you? Or even the two thirds of business owners who make less than $73k?

Here's the technical explanation of that rule:

$1:
If a business owner were to pay a spouse or child a straight salary, that salary has to face a reasonableness test to ensure that the pay they receive is earned.

"If a three-year-old child doesn't work in your business you can't really pay them a $10,000 salary, but there is no such provision for a dividend for a three-year-old child, because dividends never had a reasonableness clause," explains David Steinberg, an accountant and partner at Ernst & Young Canada.

Under the new rules, Steinberg says, a dividend paid to a child aged 18 or older, or a spouse, would now face the same reasonableness test that has traditionally been applied to family members receiving a salary. Business owners, however, can still pay a dividend to a child under the age of 18, even children as young as three years old, without that dividend being subject to a reasonableness test, but that dividend would be taxed at the maximum dividend rate.


Oh from now on if I pretend that my business profits were earned by my three year old I won't get a massive tax cut and the amount would be tested for reasonableness? The horror!

2) Pretending your income is capital gains: Capital Gains are taxed at a much lower rate than regular income such as salary or dividends . Some corporate owners currently convert what would otherwise be taxed as salary or dividends into capital gains using a complex set of transactions involving selling of some shares to another company that is also related to them. The government plans to close the loophole in section 84.1 of the tax law, which was always intended to prevent this type of gaming but is currently lacking.

Oh from now on I can't use technicalites to violate the spirit of the law to get away with money laundering? The horror!

3) Pretending that your investments in the market are actually investments in your business, aka "Passive Investment Income": Say you and I both read in the newspaper that now is a good time for people buy certain investments - stocks, bonds, mutual funds, whatever, and we eachdecide to take advantage. You earn a wage or salary for a living meanwhile I own a business. Your investments are taxed at the regular rate however I get to exploit a tax loophole and funnel the investment money through my business. and get taxed at a much lower rate than you The tax provision I'm exploiting was meant to encourage business owners to invest and grow their own business, not to play the stock market From now on, business owners' these "passive investments" (investments an owner makes through, rather than to their company) will be taxed at the same rate as anyone else's investments. Seems pretty fair to me.


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PostPosted: Sun Sep 10, 2017 7:25 pm
 


The first loophole was great. When my business was a proprietorship I paid my kids $100 a month. Sometimes they even did the chores they were supposed to.
Saved me tens of dollars in income tax.... :mrgreen:


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PostPosted: Sun Sep 10, 2017 7:34 pm
 


herbie herbie:
The first loophole was great. When my business was a proprietorship I paid my kids $100 a month. Sometimes they even did the chores they were supposed to.
Saved me tens of dollars in income tax.... :mrgreen:


Yeah but if you're a corporate CEO who has set up the terms of his employment to receive his compensation in the form of invoice payments to the CEO's personal consulting firm, that savings could be tens of thousands of dollars.


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PostPosted: Sun Sep 10, 2017 7:42 pm
 


BeaverFever BeaverFever:
Of course Lornes rant, like most right-wing rants doesn't provide you any actual facts or details of just what exactly these tax changes are. Like so much of the hot air that comes from the right these days, it's all just empty rhetoric trying to appeal to emotions. It's like one of those magazine ads that just has the brand name and a picture of a sexy chick but doesn't give you any idea of what product or service they're trying to sell or who they're trying to sell it to. They're just trying to invoke a Pavlovian response.

In fact the government has explicitly said the changes won't affect anyone earning less than $150k.

What exactly are the details of this tax plan? The government is closing 3 tax loopholes, which apply to all "self employed" taxpayers- every doctor, lawyer, dentist, high-priced consultant, investors, and realtors mostly benefiting high income earners. Don't let Gunther'a misdirection fool you- the impoverished businesspeople scraping by don't benefit much from these loopholes.

1) Pretending a poorer family member earned your income, aka "Income Sprinkling": This is the practice where business owners in high income tax brackets are currently alllowed to "sprinkle" some of their taxable income among family members in lower tax brackets on their tax return, even if those family members aren't involved in the business in any way. Does that sound like a struggling small business owner making less than $33k to you? Or even the two thirds of business owners who make less than $73k?

Here's the technical explanation of that rule:

$1:
If a business owner were to pay a spouse or child a straight salary, that salary has to face a reasonableness test to ensure that the pay they receive is earned.

"If a three-year-old child doesn't work in your business you can't really pay them a $10,000 salary, but there is no such provision for a dividend for a three-year-old child, because dividends never had a reasonableness clause," explains David Steinberg, an accountant and partner at Ernst & Young Canada.

Under the new rules, Steinberg says, a dividend paid to a child aged 18 or older, or a spouse, would now face the same reasonableness test that has traditionally been applied to family members receiving a salary. Business owners, however, can still pay a dividend to a child under the age of 18, even children as young as three years old, without that dividend being subject to a reasonableness test, but that dividend would be taxed at the maximum dividend rate.


Oh from now on if I pretend that my business profits were earned by my three year old I won't get a massive tax cut and the amount would be tested for reasonableness? The horror!

2) Pretending your income is capital gains: Capital Gains are taxed at a much lower rate than regular income such as salary or dividends . Some corporate owners currently convert what would otherwise be taxed as salary or dividends into capital gains using a complex set of transactions involving selling of some shares to another company that is also related to them. The government plans to close the loophole in section 84.1 of the tax law, which was always intended to prevent this type of gaming but is currently lacking.

Oh from now on I can't use technicalites to violate the spirit of the law to get away with money laundering? The horror!

3) Pretending that your investments in the market are actually investments in your business, aka "Passive Investment Income": Say you and I both read in the newspaper that now is a good time for people buy certain investments - stocks, bonds, mutual funds, whatever, and we eachdecide to take advantage. You earn a wage or salary for a living meanwhile I own a business. Your investments are taxed at the regular rate however I get to exploit a tax loophole and funnel the investment money through my business. and get taxed at a much lower rate than you The tax provision I'm exploiting was meant to encourage business owners to invest and grow their own business, not to play the stock market From now on, business owners' these "passive investments" (investments an owner makes through, rather than to their company) will be taxed at the same rate as anyone else's investments. Seems pretty fair to me.

Good points!!!


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PostPosted: Sun Sep 10, 2017 8:24 pm
 


Did anyone expect Beaver to not support a Liberal-based policy?

You can be sure if this came from the Harper Tories, he'd be crying the blues about how this is bad policy.

It's bad policy. There's no other way to spin it.


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PostPosted: Sun Sep 10, 2017 9:23 pm
 


Coach85 Coach85:
Did anyone expect Beaver to not support a Liberal-based policy?

You can be sure if this came from the Harper Tories, he'd be crying the blues about how this is bad policy.

It's bad policy. There's no other way to spin it.



R=UP


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PostPosted: Mon Sep 11, 2017 4:25 pm
 


Coach85 Coach85:
Did anyone expect Beaver to not support a Liberal-based policy?

You can be sure if this came from the Harper Tories, he'd be crying the blues about how this is bad policy.

It's bad policy. There's no other way to spin it.



There you go with empty ad hominem attacks. I explain my argument thoughtfully and all you can come up with is empty personal attacks. Don't become another Martin.


You don't have to look too far into my posting history to see I've been consistently supportive of taxes and ending tax loopholes for and the wealthy. INCLUDING an exchange you and I had just days before this announcement. To say I would oppose this id it came from a different party is FUCKING LUDICROUS and you should be ashamed of yourself for having to resort to such a pathetic empty canned and false rebuttal.


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PostPosted: Mon Sep 11, 2017 5:52 pm
 


BeaverFever BeaverFever:
Coach85 Coach85:
Did anyone expect Beaver to not support a Liberal-based policy?

You can be sure if this came from the Harper Tories, he'd be crying the blues about how this is bad policy.

It's bad policy. There's no other way to spin it.



There you go with empty ad hominem attacks. I explain my argument thoughtfully and all you can come up with is empty personal attacks. Don't become another Martin.


You don't have to look too far into my posting history to see I've been consistently supportive of taxes and ending tax loopholes for and the wealthy. INCLUDING an exchange you and I had just days before this announcement. To say I would oppose this id it came from a different party is FUCKING LUDICROUS and you should be ashamed of yourself for having to resort to such a pathetic empty canned and false rebuttal.


Yawn.

It's not an attack. It's a conversation in an open forum. The only pathetic thing here is your whining. If you can't handle opinions about your opinions I suggest you grow a pair and come back with your big-boy pants on.

We recently had an exchange about the legalization of pot. Zero discussion about higher taxes or closing loopholes.

I have looked into your posting history and 99.9% of the time, you've come to the defense of any political policy coming from the Provincial and Federal Liberals. Granted, you'll offer a glancing criticism of a policy while simultaneously praising it and then have the gall to claim you're somehow offering up a non-partisan opinion.


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PostPosted: Mon Sep 11, 2017 6:20 pm
 


BeaverFever BeaverFever:
Of course Lornes rant, like most right-wing rants doesn't provide you any actual facts or details of just what exactly these tax changes are. Like so much of the hot air that comes from the right these days, it's all just empty rhetoric trying to appeal to emotions.


Hang on there Beave, before you get too swelled up with pride and break the back of the high-horse you're riding in on, did you notice the piece you're blasting as being nothing more than an opinion was posted in the "Opinions" section of the Sun? Did you think to wonder why the OP is posted in the "Columns" section here and not in "Current Events" proper?

Also there was a second link. I think it showed pretty clearly how a small business owner's tax breaks were only leveling the playing field with say a unionized employee bringing in a similar take home pay.


Last edited by N_Fiddledog on Mon Sep 11, 2017 7:25 pm, edited 5 times in total.

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PostPosted: Mon Sep 11, 2017 6:27 pm
 


$1:
“I want to be clear,” Prime Minister Justin Trudeau said at the Liberal party’s recent caucus gathering in Kelowna. “People who make $50,000 a year should not pay higher taxes than people who make $250,000 a year.”


Trudeau was defending the government’s proposed small business tax changes, which would eliminate such practices as business owners paying themselves dividends, sprinkling income among family members or holding certain investments — such as real estate — through a corporation.

These proposed changes have touched off a firestorm of protest from small business owners — and Liberal MPs are feeling the heat. So the PM and Finance Minister Bill Morneau are attempting to douse the flames by talking up “tax fairness” — something they figure most Canadians would agree upon. After all, taxation is supposed to be progressive — the more you make, the more you pay, right?

But that’s where they’re actually dead wrong.

What matters isn’t how much you make. What matters is how much you take home — after expenses are factored in. For some professionals, these expenses are considerable. Doctors pay overhead, staff salaries (like Mr. Trudeau, they need someone to answer the phone) and other operating expenses. Female doctors even finance their own maternity leaves — a rich irony, given how this PM prides himself on creating policy through a lens of gender equity.

“You move the goal posts in the middle of the game,” Dr. Anita Sana recently told Trudeau, “and expect me somehow to be able to plan for my retirement, plan for maternity leave — which I will not be able to afford at this time — and I’m having to choose between having a family and being able to actually practise as a physician.”

Take-home pay also has to include the benefits received by workers — which, particularly if they are unionized, can be considerable, even for people in the middle of the income scale. Independent professionals don’t get any of these — a fact which makes Trudeau’s numbers game even more disingenuous.

For argument’s sake, let’s compare two taxpayers. The first is an unionized Ontario teacher making $90,000 a year. She benefits from two months’ annual paid vacation, 11 fully paid sick days and one of the most generous pension funds in the country. She gets other perks as well: personal development training, free parking and the biggest perk of all — job security. She can retire with a full pension when her age and qualifying years add up to 85, which means that a teacher who has taught for 32 years since age 21 can hang up her Smartboard at 53.

The second taxpayer is a freelance communications professional making $90,000 a year. She benefits from … nothing. She has no paid sick days, no paid vacation, no pension plan. She has to pay for every paper clip, every computer upgrade, every tank of gas and every parking spot she needs to do her job. This takes a considerable chunk out of her take-home pay. She has no job security; she needs to hustle for work, fighting for clients and gigs in the real and virtual world, maintaining a web presence, networking constantly. She is staring 50 in the eye and doesn’t see herself retiring anytime soon.

But she’s not griping. Instead, she incorporates, which allows her to pay less tax. She deducts the items she needs to conduct her business. She pays herself dividends, which are taxed at a lower rate. She leaves some money in the corporation, which also is taxed at a lower rate. Those funds are directed to savings she puts away so that, like the teacher, she has security for a rainy day, or for when she retires. And whenever that day comes, and the money is taken out, it will be taxed, as income — with the government again getting its cut.

This taxpayer is not hypothetical. She is not part of the platinum-card 1 per cent. She is the voter Justin Trudeau claims to care about: middle class, raising a family, contributing to her community. Trudeau’s tax changes will not only make her worse off than her teacher counterpart (which is unfair), they also will hurt all the people and businesses she spends money on, from the computer repair guy to the lunch place she takes clients, because she will have to cut spending to make ends meet under the new rules.

Which is exactly what the government will not have to do. Make no mistake: The real motivation here is feeding the spending Leviathan that is the federal government. After pledging “modest” deficits of $10 billion, Trudeau has racked up $30 billion in deficits as far as the eye can see. So rather than buckle his belt, he wants Canadians to buckle theirs, under the guise of fairness.

But only some Canadians. The millions of taxpayers affected by the small business rule changes are low-hanging fruit. They’re easy to find and the Canada Revenue Agency will have no problem shaking them down.

The real big earners — the 1 per cent, people with deep pockets and clever lawyers, people who can move money to the sunny jurisdictions now flattened by Hurricane Irma — will carry on unscathed. If that’s this government’s definition of fairness, it needs a better dictionary.


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