Canada’s richest one per cent tax payers saw the country’s total income remain the same in 2013 and there average total income grow by the same amount as everyone else’s. The economic controversies is how the tax system affects the behaviour of the wealthy and the impact of these behavioural changes on economic performance is still controversial questions for the design of tax policy amongst the top 1-10 percent. To be considered into the top one percent of tax filers, a worker had to earn $222,000 a year. In Canada that group included 264,030 according to Statics Canada. To be included in the top five per cent, the income cut-off was $115,700 while to be in the top 10 percent required $89,200.The average one percentage of citizens paid $151,900 …show more content…
Sherry Cooper of Dominion Lending Centres has different views than Prime Minister Justin Trouto. Dr. Cooper believes that taxing the rich more is a very inefficient way to raise revenues or to address income inequality. It will shrink the economic pie. This increased taxation of the rich will make it very hard for Canada to attract and keep the most productive talent. Canada will lose this talent because the talent will move to the United Sates because of their lower tax rates. This increased taxing rate will discourage business and personal investment in Canada and provide an immense hindrance for innovation and job growth. Not only will Canada not be able to keep talented workers, it will also be more difficult to attract foreign talent, especially given the depreciation in the Canadian dollar The tax rates in Canada are already highly progressive and will increase when the federal government reduces tax rates for the middle class. The reduction of the taxes on the middle class in Canada will increase disopoasal income and spending for this group of individuals. This will be benfifitical because the middle class has experienced little income growth in recent years. The higher tax rate for high-income earners is not desirable. The higher the tax rates, the greater reason to avoid paying them. There is already a large amount of planning by the wealthy taxpayers to adjust there fances to avoid or minimize the effect of proposed tax increase on individuals earning in the top 1% of Canada’s population. With such an action the revune gain will be far lower than the government expected. Tax planning’s included; rearranging sources of income, changing jurisdictions, changing the timing of the sale of capital assets. These actions by the high- income earners will do little to increase tax revenues or reduce income
Our company will be opening an office in Nunavut this year. All the employment income are subject statutory deductions, CPP contributions and EI premiums from employees and the employer’s portion, income tax from employees, employees in Nunavut must be remitted the payroll tax. Here are from five aspects to explant:
Under Canadian Tax Law, there is an election for companies to defer recaptures and capital gains of property that was involuntarily or voluntarily disposed of. In this research paper, we attempt to prove that the election is a useful taxation strategy for businesses so that they are not subject to pay taxes on capital gains or recaptures until such a time where they may acquire an eligible replacement property that will help them earn business income. We will provide facts, definitions, and examples to illustrate the use of this election throughout the paper by explaining the capital cost allowance system, the offset available to business for capital gains and recaptures, the election process, the rules regarding replacing former business
In a recent interview in the Ottawa Citizen, Justin Trudeau spoke on his decision to increase taxation on the wealthy upper class in order to redistribute money to the middle and lower class. This is in response to the issue of stalled median household income where Canada’s GDP has doubled yet household income has only increased by 15% (Kennedy 2015). This hints at income inequality in Canada, as it sheds light at the struggle of middle class families to provide for their families. Parents are having to choose between their retirements or providing education for their child (Kennedy 2015). To Justin Trudeau, this means that “something isn’t working anymore” (Kennedy 2015). Most likely, he senses that the way money is earned and distributed in Canada is highly unbalanced, leading to a income gap between the rich and the poor. Trudeau’s solution to middle class worries is to increases taxation on upper class
Many people believe that because wealthy citizens have more money they are not paying their fair share in taxes; however, this is quite the opposite. According to an article by Jason Russell, he claims that the top one percent pay
In today’s society it is unfortunate to say that a person’s income does reflect their value to society. Classism, it affects all of us. The government has classified you based on your yearly income. For example; if your income is between $18,000 - $23,000 you are classifed as a lower class Canadian. If your income is between $35,000 - $55,000 you are the average middle class Canadian. To be classified as an upper class Canadian your income would need to be anything above $55,000. The government has also classified those with combined income so if you are common - law, or married. Have you ever wondered why a doctor gets paid more than a construction worker? A doctor gets paid roughly $360,000 a year compared to the $63,000 a year income a
The issue of economic inequality has ruined the economy of the United States completely. This issue is making its way to Canada, which is causing more of its citizens to go into poverty. When this problem first started to arise, it was strongly ignored by the government because they believed it would not cause a problem. However, over the past twenty years, it has increased rapidly which caused the gap between rich and poor to became enormous. Moreover, the wealth of the rich strongly depends on the disadvantage of the poor. The only way the rich will stay rich is if the poor stay poor. The top one percent of Canadians receive 318,000 dollars on average whereas the bottom ninety percent receive only 28,000 dollars. If the poor start getting high
Whilst William McBride, chief economist for Tax Foundation website, sided with tax cut policy saying that to strengthen the financial state, “we should lower taxes on the earnings of capital,” “workers and the businesses that hire them,” Chye-ching Huang and Nathaniel Frentz, both are senior Tax Policy analysts, completely debunked the evidence McBride provided to support his argument, which includes the review of twenty-three among twenty-six studies he thought to advocate the idea. Indeed, as one conducts research, regardless of what sources it comes from, agreement over tax issue should never be found as a unanimous answer. One of the reasons why it is so difficult to reach a definite conclusion rests on the fact that although some statistics may show economic growth was in step with tax cut, correlation does not mean causation: just as ice-cream sale and murder rate increase during summer time, it is baseless to assume that higher ice-cream consumption leads to higher odds for crime. Moreover, because there is a great amount of research has been done on taxes, different interpretations from these data are understandable. Before concluding that “nearly every empirical study of taxes and economic growth published in a peer reviewed academic journal” finds cutting taxes improves the financial status quo, thus, people need to consider
There is no doubt that wealth inequality in America has been escalating quickly; the portion of total income earned by the top one percent has doubled since the beginning of the 1970’s. The wealthy are the main beneficiaries
Although Canada is a rich country there are still people who live in poverty, “In 2011, the government classified about 4.7 million men, women and children –– almost 15 percent of the Canadian population –– as poor” (Macionis, Janson, Benoit, & Burkowicz, 2017) but Canada calculates its poverty rate by “one popular measure known as the LICO, a family has an income below the low income cut-off of it spends more than 63 percent of its after-tax income on the necessities of food, clothing, and shelter, including corrections for different family sizes and the cost of living in particular communities.”
However, raising taxes on the rich and corporations is not as helpful to our economy as most people think. Although raising taxes on the top percent of people and companies appears to create more income for the government, the result will make it harder for middle class and lower class citizens to grow. Some argue that by combining several key changes, including the simplification of the tax code to avoid loopholes and the decrease of taxes on the rich and corporations, there will be an improvement in the national economy. Although this may seem a bit counterintuitive, it makes more sense when looked at closely. By lower taxes and remove all loopholes, smaller businesses are given further opportunities to grow instead of facing financial roadblocks and government
At this point of time, the minimum wages are at a good rate because otherwise if the wage is increased too much the companies will go into debt. Not everyone earns the minimum wage but in fact most people earn more than that hourly. Since Canada is in debt, it’ll be a good thing if people have a higher income from these type of basic jobs because then they’ll have to pay more taxes. In my opinion, rich people should have higher tax rates depending on how many people they have in their household. It would make more sense if the people who have a lot of family members living with them in the same house should have a lower tax rate even if they are rich. Then, rich people with less members in their household should have a higher tax rate. This
Heavily desired tax cut wishes have been granted by him, giving more people more money. Upscale aristocratic Canadians have been presented with much higher taxes than the majority because they can afford to provide more tax dollars than the majority of the people. This benefits people with less money making it easier for them to live comfortably.
The United States is can be considered as a rich country. It is rich in culture, it is rich in individualism, it is rich in productivity, and it is rich in inequality. The “top 1%” is often spoken about in the media and in referred to in the daily lives of Americans. The 1% are usually executives, politicians, doctors, and lawyers. Their average income is about $717,000
Inequality in Canada is not as prominent as many other places around the world, although it does remain in certain segments of Canada. There are many forms of inequality in Canada and internationally, although this papers main focus is going to be the inequality of wealth. According to Steven Kerstetter “Canadians may view their country as a land of opportunity, but it is also a land of deep and abiding inequality in the distribution of personal wealth” (Kerstetter 2002). The “gaps between the rich and poor remain evident in Canadian statistics” (Kerstetter 2002), Canadians have always kept financial security as an essential element of life and have tried to obtain and sustain it within their lives. Frank Cunningham’s article, “What’s
This fact remains accurate after government attempts at wealth redistribution such as taxes. This shows that the government is not successful at helping to redistribute wealth and the dramatic increases in wealth of the rich while the poor barely improve show the inefficacy of the “trickle-down economy” model. To figure out why the 10% is gaining wealth so quickly, the people that make up this small group must be analyzed. The top 10% is essentially comprised of three main groups: superstars, CEOs, and high-income professionals. However, the incomes of superstars and CEOs are increasing more rapidly than those of the high-income professionals (Belsie). While the incomes of high-income professionals and superstars are market driven, they do not benefit from the same rate that CEOs do.