Will the Liberal Budget increase Capital Gains tax from 50% to 66.67% or 75%?


In the days before the Federal budget is revealed, rumours continue to swirl that the Liberals are going to raise taxes in a roundabout way, by reducing the tax break Canadians receive from capital gains.

In the 2007 Federal budget, the Conservatives increased the lifetime capital gains exemption 50% to $750,000, which means that the first $750,000 of the sale price of each shareholders company “Shares” will have a capital gain which is exempt from all income taxes.  The rate has changed over the years, so its’ not without reason to believe it might change again, especially in light of the money the Liberals promised to spend.

Currently, under the Income Tax Act, 50% of capital gains, on everything from property to stocks and mutual funds, are taxed.  The effective tax rate is therefore half of the marginal tax rate.  In some provinces, the current capital gains rate means tax of more than 25% on investments for high income investors.

Speculation is that the Liberals might move that taxable amount to 2/3’rds or 75% while they pay for all their election promises, and then eventually returning that to 50% near election time to encourage voter support.

With capital gains being taxed less heavily than dividends, there is little incentive for business owners to take cash out of their business and pay the taxes via dividends when they can just sell the company, pay the capital gain, and then start again.

The Liberals want to be more friendly to small business owners and the middle class, it will be interesting to see if they change this rate in the budget since they did not mention this in their election campaign.

A change of this magnitude might trigger an asset sale, or cool the real estate market for people who buy assets, then flip them within a short-term period of time, realizing a gain on the sale.

 

Ontarians Open Your Wallets… Wide! Liberal Budget 2016.


Nine years, Ontario has elected Liberal governments and for nine years, the taxpayers in this once mighty province are facing a budget whiledeeply in debt.

In fact, when the Ontario Liberals unveil their budget today, it’s going to include some really fancy talking and no mention of increasing taxes, yet it’s the only way they can eliminate the deficit and put a stop to the massive debt.

How massive is the debt?

Ontario has the largest debt of any sub-national government in the world!

The world!

Taxpayers pay an astounding $11-billion dollars a year on interest on the debt. Think about how many unions could be paid off with those funds, gas plants moved or documents shredded…

The Wynne Liberals will likely blame the Ontario Conservatives, or the Federal Conservatives, but they have already started to leak the “tax” increases coming down the pipe for Ontarians, including 4.3 cents to the price of a litre of gas plus an increase of $5/month to our natural gas bill – in order to protect the environment, no less…

Where the rest of the “savings” come from is unknown at this time, however, healthcare and education are likely to take a big hit.

Additionally, while it’s great that grocery stores are able to sell wine, the Liberals are likely to set a new minimum price for that bottle through this budget and add additional taxes on top of it.

Here is a recap of the “highlights” of the budget:

  • Ontario’s net debt will hit $308 billion in 2016-17.
  • Ontario’s debt is the largest of any sub-national jurisdiction in the world
  • Ontario taxpayers are paying $11.8 billion in interest payments per year
  • Interest on Ontario’s debt is going to increase to $13.1 billion by 2018-19
  • University and college tuition will be free for students from families with incomes of $50,000 or less.
  • More than half of students from families with incomes under $83,000 will receive non-repayable grants (which exceed the cost of an average tuition).
  • A carton if cigarettes will increase by $3.00, effective at 12:01 a.m. Friday.
  • Taxes on tobacco rise at the rate of inflation each year over the next five years.
  • The minimum price for a bottle of wine rises to $7.95.
  • The LCBO will be increasing their mark-up on wine to compensate for the fact consumers can purchase them at grocery stores, so in June there will be a 2% hike, followed by 2% hikes in 2017 and 2018 with a 1% hike in 2019.
  • There will also be annual increases of about 10 cents in the tax on wine sold in private retail outlets, increasing from 16.1 cents to 20.1 cents over four years
  • The $30 fee for Drive Clean vehicle emissions tests will be eliminated in 2017-18 – not the test – just the out of pocket cost which taxpayers will be paying to the tune of $60 million/year.
  • Hospitals will get their first funding increase in five years, up $345 million, plus $12 billion over 10 years in capital grants for about three dozen major hospital projects
  • The threshold for seniors to be eligible for cheaper drugs rises from $16,018 to $19,300.
  • The Liberals have committed $333 million over five years to redesign and improve autism services.

 

So as the Liberals promised, the Liberals shall deliver.  Spend, spend, debt, deficit, spend…  To the highest debt in the world.

The Conservatives are going to have a huge headache cleaning this mess up in 3 years!

Liberal Majority Government! Stephen Harper Resigns. I Hope the Tax Increase Was Worth It!


Well, Justin Trudeau and the Liberal Party of Canada are forming the next government of Canada – a Majority government, no less.

I cannot help but feel deep down inside that there was so much hatred directed at the Prime Minister and that people voted to remove him from office and chose the Liberals over the NDP to do so.

Unfortunately, the electing of the Liberal Party also brings with massive debt and after the spending spree the Liberals intend to go on, the deficit is going to increase at a rapid rate, and as we all know, the Liberals need money to pay for their promises and that money comes from you and I, the taxpayers of Canada.

UGH.

I hope the desire to remove Harper is worth the headaches we’ll be suffering with Justin in command, and I’m not just talking about their out-of-control spending.

Here are some great Justin oops which hopefully will not be occurring as leader of the country;

Unlike Ontario Premier Kathleen Wynne who has made MANY mistakes but covered them up with flat denial, avoidance and threats of lawsuits, Justin Trudeau has not appeared to understand the importance of thinking before he speaks.

During the controversy surrounding Bill C-51 – a bill where by the Canadian Security and Intelligence Service (CSIS), and 17 other government agencies are granted the authority to combat threats to Canada’s national security, preferably without infringing on Canadians’ Charter of Rights and Freedoms, the Liberal leader who voted for the Bill, has now admitted that his support for the Conservatives Bill might have been a mistake…

During the Maclean’s Magazine leaders debate, Trudeau responded to the conversation around the Liberals’ support of C-51, with these four words: “Perhaps it was naive.”

Here is how he voted on the Bill;

https://openmedia.ca/blog/whos-our-side-heres-how-your-mps-voted-bill-c-51

To give Trudeau the benefit of doubt, it was a tough decision to make, I’m sure. I heard him stumble and bumble over the easy questions about which shampoo he uses and which Avenger was his favourite, so maybe this way just a difficult question for him to answer.

He does like to go (vote) with the crowd… He knows legalizing pot is popular with the kiddies.  Personally, I believe pot should be legalized and taxed because the government can use the revenue to counter the health care costs associated with medical issues stemming from drug use.  Heck, they should legalize it and then increase EI funding and the length of time EI benefits are in effect to accommodate all the happy people…

He knows taxing the “rich” or the “1%” is popular with the other 99% of Canadians, and he knows that increasing spending to get stuff done is super-popular.  What he will soon realize is that whatever tax increase he throws towards the “1%” is not going to be enough to offset their massive spending increase which is coming down the pipe.

Oh, and the 1%… Who are these awful rich people who get all the tax breaks according to Trudeau?!? In Canada the highest Federal tax paid is 29% for those making over $138K per year. Add that to the provincial rate, and in Ontario, for example, someone making over $138K can pay over 42% of their income in tax. (http://www.cra-arc.gc.ca/tx/ndvdls/fq/txrts-eng.html). Are these the people he will be targeting? Or, is Justin going after the REALLY rich people who based on very basic mathematics make the most money, but also pay the most back in taxes!

Trudeau hates small businesses, and this should become very evident in the Liberals first budget.  Trudeau believes small business owners create businesses as a vehicle to hide their massive incomes.  Doesn’t every 1%’er want to have to deal with the Canada Revenue Agency on a daily basis, be responsible for the income of their employees and paying taxes to keep the economy ticking so the Liberals can come in to power, increase taxes and call them frauds… Don’t think so.  I predict he’ll stop the small business tax decrease that the Conservatives brought in.  Even though the Liberals and the NDP have agreed to keep it, if elected, it’s a certain no go in my opinion.

I believe in discussing facts, so I went to the Liberal Party of Canada’s website, to the link for “My platform”, to make sure I presented his promises in a fair and reasonable manner. Unfortunately, because I was unwilling to click that I would be / or might be voting for Justin, I was not able to get in to the secret Liberals playground. Instead, I had the option to use a search option to add what I want from the Liberal Party.

I entered this; “Fiscal responsibility, Responsible spending, Respectful spending, Respect for Taxpayers money, Lower taxes, Do not raise taxes, accountability for words and actions.”

The search engine was not able to find a match for any of these items in the Liberal’s platform!

Oh my.

Deep down inside, I feel that the Liberals and their leader know that only in Ontario will citizens tolerate out of control spending and corruption by continuously voting in the same government which increased taxes, delisted services and has caused absolute chaos with teachers and soon doctors.

I believe there really is a left-wing media bias in Canada and sadly, I even predict that in their first (or second budget) the Liberals will even restore funding to the CBC, but not extend any funding to any other media outlets, especially to any who do not share their rosey view of the world.

When Trudeau said, “The budget will balance itself”, he believed it.

He also has very poor judgement. He accepted Conservative hand-off Eve Adams, who was being dropped by the Conservative party, and who then lost her nomination bid to Marco Mendicino. Where were the questions surrounding his judgement as has happened to Stephen Harper regarding his appointment of Mike Duffy and Pamela Wallin to the Senate.

Trudeau also publicly mistook Russia’s opposition leader Boris Nemtsov (who was shot dead in Russia) with former Russian Prime Minister Mikhail Kasyanov (whom he had met with), in a press release.

Or when he called a Conservative member a “Piece of Shit”, then went on a potty mouthed tirade where you can see that he actually enjoyed it without thinking for a moment about the implications down the road (http://operationmaple.ca/laugh-out-loud/justin-trudeau-swears-house-of-commons.html)

So much like his Dad…

Or, when being interviewed on Les francs-tireurs, Trudeau said, “Canada isn’t doing well right now because it’s Albertans who control our community and socio-democratic agenda.”

He also said Canada would be better served if there were more Quebecers than Albertans in charge.

Trudeau did apologize, and then tried to explain away his thoughtlessness by saying he didn’t hate Albertans but that his comments were directed the Prime Minister, Stephen Harper, who rose to power as an MP from Calgary, which he really thinks makes it all okay…

But he doesn’t just hate Alberta… He hates all of Canada, except Quebec. As a MP, Trudeau told Radio Canada; “I always say, if there came a point where I thought Canada really was Stephen Harper’s Canada … maybe I’d consider making Quebec a country. Oh yes. Absolutely. I know my values very well even if I no longer recognized Canada.”

(http://www.torontosun.com/2012/02/14/trudeau-says-hell-help-quebec-separate-if-harper-gets-his-way)

There is even a story – recently removed from the Internet – where Justin Trudeau declared that if aliens came from outer space, they would have the same rights as human beings, and would be granted Canadian citizenship…

Now I’m sure that the puppeteers pulling the strings of Trudeau are in full spin control, teaching Justin how to correct his oops and explain that clearly each and every comment has been taken out of context or manipulated by the evil Right-Wing media in Canada – wait, we don’t have that option so much anymore – then it must be Stephen Harper’s fault for forcing Justin to speak this way.

He’s young… ish.

He’s hip… ish.

He’s trying to keep up with the success of Ben Mulroney, but he’s just going to promise himself into a corner and ask every Canadian to Ben Dover.

On October 19th the Canadian public have made a choice, and I have a few words for voters in Canada… Caveat Emptor. Let the buyer beware!

I hope PM Trudeau v2.0 doesn’t embarrass the country, because after all the selfies have been taken, he still has to do the right thing.  Having former PM Stephane Dion as his Minister of Foreign Affairs is laughable and quite frankly frightening…

Time will tell.  Wait until his first budget and we’ll see how these predictions stand up!

Monday Musings and More


Monday Musings and More

Exercise:

So my wife found a 21-day exercise program for us to do.  My first question to her was, “will there be fat people in the video?”, because I am not doing any exercise program where every person is 20-years-old, has 1% body fat and muscles where I didn’t know muscles could be.  It is those workouts where I feel my age and more afterwards.

After one workout, I have to say that I can still move, and yes, there was a “less-fit” person in the video.

If you have never seen me, I have to explain that I am a fairly big guy, bone-wise, and I hide my weight well considering how much I actually weigh, probably because I’m active – play ball-hockey in a league at least once a week – and I try to get active a couple more times per week.

In fact, I hide my weight so well that I always win in a guess-your-weight contest, the last couple of times the “expert” was off by 70lbs. I even gave him a second and third chance but he just got more and more upset, then was embarrassed once I stepped on the scale… Oops.

 

Sports:

Does NYY DH A-Rod deserve to be an all-star? No, but I have to say that I was sure I would NEVER be able to forgive this cheater for being such an arrogant asshole while cheater the entire time, but with all the crap the Yankees heaped on him, I actually feel that if he is clean, he has worked very hard to earn his playing time and I’m actually kind of rooting for him.

TNA / Impact Wrestling:
Because of the dumbass decision to have their program on The Fight Network, one of few stations we do not get in our massive cable package, I have to resort to watching it on YouTube.  The YouTube broadcasts are worse than awful, the program is still very confusing and with rumours of wrestlers leaving en mass, I’m watching less and less.

Even worse is Josh Matthews pretending to be at the event when we all know the show is taped and the commentary is being recorded after, but why does it look like he’s in a bee hive and does it sound like he has his hand over his mouth when he is speaking.

Again, I’m thrilled that Mike Tenay is not on these shows, but the quality of these broadcasts make Impact look more like Ring of Honor.

Why can’t TNA just finally drop the TNA, merge with a legit brand or bring back a real name and get back to basics. Fewer wrestlers, more stories, and get fans excited about the brand again rather than having us rush to be watch the death of the show.

Before it’s too late…

 

Coffee:
The Second Cup’s Butter Pecan coffee might just be one of the best coffee’s available. It’s fantastic, and requires less sugar than other coffees.

It was nice to see my new favourite coffee company, Javaworks, is the official coffee supplier for one of our favourite breakfast joints, Steve’s on Bathurst Street, just north of Wilson Avenue, in Toronto. The coffee there is always delicious, and now I know why!

 

The Urban Daddy:
If you’re looking to be more involved in The Urban Daddy, now might just be your chance! I’m looking to get back blogging on a more frequent timetable and to have some time to address the pitches and requests which come my way daily.

I cannot get to them all, and as of right now, I’m giving preference to the local (Toronto and surrounding area) ones.
If you are interested in writing a post her and there, or attending an event on behalf of The Urban Daddy, and then writing up a post, with some pictures, please let me know by email to: realurbandaddy@gmail.com

I’m not just looking for one person, to be honest, the more the merrier.

 

Children:
With 2 of my 3 kids away at sleepover camp, I have found that the 3rd and youngest really seems to be growing up fast!

I also cannot believe how much she talks! It seems like it’s been non-stop and while I felt this way last year, I find this year is even more tiring.

Anyone else have similar experiences?

 

Tax:
As many long-time readers will be aware, I’ve been operating a tax consulting business for a few years now, and I thought it might be interesting to point out in a parenting / family blog, that the most common question asked of me this past week had to do with divorce.

More specifically, what happens when a husband and wife are in the process of divorcing and the husband either has not filed, nor disclosed his accurate income to the courts. Is there any recourse on the wife’s side, or should the Canada Revenue Agency (CRA) be made aware of this?

Furthermore, if the husband has a debt owing to the CRA, can the CRA take actions against the soon-to-be ex-wife and / or seize and sell the house.

The answer is… Maybe.

It depends on the details and I’m more than happy to listen to a situation and provide my thoughts.

My email is info@intaxicating.ca

An urban daddy get out of debt tip…


My friend and neighbour – the genius behind 17 years of http://www.supernova.com, Elliott Hurst, suggested I post this quick story (tip) we used for getting me out of debt.

When I first met my wife I had an okay entry level job and with that came an entry level wage. I had recently purchased a car – A Saturn SL1 and was paying down the car loan.

Besides that $300 a month, I was racking up credit card debt – which I could always pay for (or I would not buy something) but my bank account was dwindling, because I was buying junk like hockey cards for me, going out for lunches (treating people) and buying stuff for her, like an engagement ring.

I could not resist. Man I loved Shoppers Drug Mart and Pusiteri’s…

But one morning I came to the kitchen, grabbed my lunch, kissed her goodbye at which point I realized that my wallet was missing.

I turned around and saw it sitting on the counter.

Inside the wallet was a $20.00 bill, but none of my credit cards were present. I asked her if she knew where they were and she responded by telling me to look in the freezer.

Puzzled, I opened the freezer only to find them frozen solid in a giant block of ice.

The plan was to use that $20.00 for the whole week and not buy anything.

Guess what…

6 months went buy without me charging anything. My debt went down and I learned to say no to temptation.

So if you are struggling or in debt, or a friend is…freeze the culprit on the spot! It works, it really, really works… Brrrrr…