Provincial Economies III

[Nashe]

This is what happens when, over time, via a thousand small tweaks, you build an overly complex tax system that is incredibly fragile, as every new change affects many other things in unanticipated ways. The simplest machines break the least often, IMHO. (Same applies for IT systems, oftimes)

[MonctonRad]

Originally Posted by WarrenC12

You have benefitted from this reduced tax rate for your entire career.

Not really. The professional corporation has just allowed for some tax sheltered growth of my savings. In truth however, all this has done is give me more capital gains on retirement. Now that I am to the point that I may actually be cashing in my investments and claiming capital gains to fund my retirement, they fuck me over and increase my tax rate.

You play by the rules for 20-25 years with certain expectations, but, then at the end, they change the rules. This will affect my retirement, no question.

But, no sympathy from you. I guess I'm just another greedy doctor............

[goodgrowth]

Originally Posted by whatnext

Imagine, politicians actually making decisions based on what the public wants and is best for the economy, rather than what some ivory tower planners want. The nerve!

Subsidizing an auto worker to the tune of millions is very questionable on it's face let alone the total contradiction on urban planning.

[WarrenC12]

Originally Posted by P'tit Renard

That's such a tone-deaf comment. At most the old policy buys doctors some tax deferral.

Given how vital and essential they are to our society and the keystone of our healthcare system, they should not be punished for this government's reckless spending.

Why not instead have capital gains inclusion rates bumped up to 66-100% for residential real estate investments only and capping the principal residence exemption like they do in the US?

Who says I wouldn't support this?

Small businesses, entrepreneurs, farmers, and others all have lifetime limits far above $250k for selling their businesses.

You want to tax the wealthy? This is what that looks like.

We had far higher CG taxes in the 90s.

Lots of people here and everywhere else who'll never get close to paying this new tax rate are once again holding water for the wealthy.

[P'tit Renard]

Originally Posted by MonctonRad

Not really. The professional corporation has just allowed for some tax sheltered growth of my savings. In truth however, all this has done is give me more capital gains on retirement. Now that I am to the point that I may actually be cashing in my investments and claiming capital gains to fund my retirement, they fuck me over and increase my tax rate.

You play by the rules for 20-25 years with certain expectations, but, then at the end, they change the rules. This will affect my retirement, no question.

But, no sympathy from you. I guess I'm just another greedy doctor............

Apparently protecting Canada's slumlords and RE speculators matter more to Trudeau than allowing doctors to save up for retirement.

[Acajack]

Originally Posted by Innsertnamehere

oof, jeeze. I mean I knew as soon as it was released that it would impact less than the 0.04% of people who they claim it will... Many more people make a capital gains posting large enough to qualify for it, but often it only happens once in a lifetime (sale of a cottage, business, etc.), so doesn't register on an annual basis.

Yeah. Among our best couple friends are two public servants who were very smart and extremely lucky with the real estate market and became mini Gatineau Lios over the past 10 years.

They are life-long Liberals but super pissed over this, but not for the same reason.

I think there are lots of people in their situation. They're upper middle class to upper class for sure, so not really your Average Joe.

Still these are the classes of people that *always* vote, whereas a lot of Averages Joes do not.

[WarrenC12]

Originally Posted by P'tit Renard

Apparently protecting Canada's slumlords and RE speculators matter more to Trudeau than allowing doctors to save up for retirement.

This tax will obviously hit slumlords who sell investment property.

[thewave46]

Originally Posted by Nashe

This is what happens when, over time, via a thousand small tweaks, you build an overly complex tax system that is incredibly fragile, as every new change affects many other things in unanticipated ways. The simplest machines break the least often, IMHO. (Same applies for IT systems, oftimes)

Accountants, CRA employees, and realtors send their love though. Complicated tax systems are just misery that people inflict on themselves for reasons.

Had MonctonRad not been so selfless and been a MD, he might’ve ended up as a realtor. Or as I made the joke to a doctor friend when he was grousing about something of the like: “If you had been a little dumber, you would have had a nice nursing defined benefit pension soon.” He jokingly told me to shut my hole and get back to my peon job, the big boys had real work to do. All in good fun.

[thewave46]

Originally Posted by Acajack

Yeah. Among our best couple friends are two public servants who were very smart and extremely lucky with the real estate market and became mini Gatineau Lios over the past 10 years.

They are life-long Liberals but super pissed over this, but not for the same reason.

Ooof. There’s a constituency overlap that won’t get much sympathetic airtime.

Flashback to this Simpsons moment.

[thewave46]

Originally Posted by goodgrowth

Subsidizing an auto worker to the tune of millions is very questionable on it's face let alone the total contradiction on urban planning.

Yeah, but the cost of losing our auto sector will be huge.

The auto industry knows this, too. They play the game in a serious way with government now.

Doing the right thing is cold comfort when one becomes substantially poorer.

[P'tit Renard]

Originally Posted by WarrenC12

This tax will obviously hit slumlords who sell investment property.

Individual slumlords retain access to the $250K exemption. The tax situation is far more unfavourable for doctors who generally incorporate for professional liability reasons.

[MonctonRad]

Originally Posted by P'tit Renard

Individual slumlords retain access to the $250K exemption.

I guess physicians are worse than slumlords - truly despicable individuals deserving nothing but contempt.

[P'tit Renard]

Originally Posted by MonctonRad

I guess physicians are worse than slumlords - truly despicable individuals deserving nothing but contempt.

That's the message Freeland & Co is sending with her distasteful 2024 budget. She has just proven again that she's the worst Canadian Finance Minister in modern history.

[theman23]

I think it works out to an extra $2k for every $100k in cap gains in Ontario at the corp level? Not the end of the world, but death by a thousand cuts and all that given their 2017 reforms.

[MonctonRad]

Originally Posted by theman23

I think it works out to an extra $2k for every $100k in cap gains in Ontario at the corp level? Not the end of the world, but death by a thousand cuts and all that given their 2017 reforms.

I'm pretty sure it's more than that, at least according to my financial advisor. I have an emergency meeting with my accountant next week. I'll know more then.

[whatnext]

Originally Posted by WarrenC12

Who says I wouldn't support this?

Small businesses, entrepreneurs, farmers, and others all have lifetime limits far above $250k for selling their businesses.

You want to tax the wealthy? This is what that looks like.

We had far higher CG taxes in the 90s.

Lots of people here and everywhere else who'll never get close to paying this new tax rate are once again holding water for the wealthy.

Lot of people here and everywhere else in Canada who will never get a family doctor...

[MonctonRad]

Originally Posted by whatnext

Lot of people here and everywhere else in Canada who will never get a family doctor...

As I mentioned previously, I came within a hairs breadth of moving to the States in 1995. If I had known then just how far down the shitter things were going to go by the time I was planning to retire, I would have followed through.

I would be in good company. 25% of my med school class eventually moved to the US to practice, including some outstanding academic stars. A tremendous loss to Canada.

[Innsertnamehere]

Originally Posted by MonctonRad

I'm pretty sure it's more than that, at least according to my financial advisor. I have an emergency meeting with my accountant next week. I'll know more then.

In New Brunswick, assuming you are at the top marginal tax rate, it'll be an extra $7k per 100k of capital gains (going from $26,250 in taxes on $100k to $33,250 on $100k). I mean really you are only paying 33% effective taxes on it still. A lot higher than the 26% effective rate before, but both rates are still lower than the top marginal rate for someone making $60,000 a year for their income taxes.

[Truenorth00]

Originally Posted by goodgrowth

Subsidizing an auto worker to the tune of millions is very questionable on it's face let alone the total contradiction on urban planning.

I'd have less of an issue with this argument if we weren't resorting to protectionism and economic support in so many other sectors. Also, avoiding subsidies would be a defensible argument if the US wasn't engaging in economic warfare. Sorry, but I'm sick of the country's industries being digging shit out of the ground and selling cardboard skyboxes to reach other and foreigners.

[MonctonRad]

Originally Posted by Innsertnamehere

In New Brunswick, assuming you are at the top marginal tax rate, it'll be an extra $7k per 100k of capital gains (going from $26,250 in taxes on $100k to $33,250 on $100k). I mean really you are only paying 33% effective taxes on it still. A lot higher than the 26% effective rate before, but both rates are still lower than the top marginal rate for someone making $60,000 a year for their income taxes.

Yes, but it's important to remember that you have to pay tax again even after you redeem your money from your professional corporation. It becomes personal income after that, and, subject to personal income tax (over and above capital gains tax).