GT: Federal Election

[EldrickOnIce]

Originally Posted by Hesla

So if i have my math right.

Someone earning about $220k will save $670 on the 45-89k tax bracket, but lose an extra $670 with the over 200k tax bracket. So really, those making more than 220k are the ones that will see increased income tax.

Math : 45k x 0.205 = $670
220k x 0.333 = $660

Well, the answer is close to right, but the equation wrong.
The 45k (between 45 and 90k) is taxed 1.5% lower, so 45000 x .015= $675
The highest tax rate, on money earned over 200k was 29%. Now it will be 33%, so an increase of 4%.
So $675 (the tax money you are ahead) divided by 4% is 675/.04 = 16,875

So is 200k is the kick in point of the higher tax, an income of 216,875 is basically the break even point of the new taxation policy. Anything above that, and you will now pay more tax. Anything below that and you will still pay a bit less.
One can't ignore other other changes when considering the entire tax burden (TFSA, UCCB, income splitting, etc) but strictly from an income tax perspective, those are the numbers: The middle class, between 45k and 216K (individual income), will get a federal income tax break through that plan.

[HockeyIlliterate]

Originally Posted by PepsiFree

Slightly higher?

Yes, slightly higher.

Originally Posted by PepsiFree

And we're talking about a 210K salary . . .

Actually, my hypo involved a $201K salary.

I thought that your first reference to $210K was just a typo, but if you really want to use that number, so be it.

Regardless, as evidenced by what I consider to be "slightly higher," aren't most debates and discussions regarding tax matters and what is fair or appropriate all relative to one's amount of current income or wealth?

[Bill Bumface]

Originally Posted by GGG

And to protect exports we should only tax carbon at the tail pipe. Oil that is exported outside of Canada should have the carbon implications go to who ever burned it. If the Saudi's aren't going to tax the lifecycle emissions of oil burned in the US we shouldn't either.

Any carbon tax should be attached only to the final user of the good.

The problem is there is a crapload of diesel and natural gas burned to produce a lot of AB oil. So should you not pay "at the smokestack" for the NG burned and at the tailpipe of generation equipment and various vehicles and machinery used by the industry?

I think having that mechanism in some form is a good thing, it encourages reduction in emissions, which has become a focus for a lot of companies who previously didn't care about it.

Past that point, I agree, there is no tax on the good you produce until it reaches the consumer.

I think this is sort of how it works already?

[Flamenspiel]

There is the question of weather the changes will be retroactive to 2015 or begin with the 2016 tax year. I believe they would have to have a parliamentary session and it would have to move pretty fast to get it in for this year. I any case, its important to get with your accountant and discuss any advanced(late) tax planning ASAP.

[GGG]

Originally Posted by Bill Bumface

The problem is there is a crapload of diesel and natural gas burned to produce a lot of AB oil. So should you not pay "at the smokestack" for the NG burned and at the tailpipe of generation equipment and various vehicles and machinery used by the industry?

I think having that mechanism in some form is a good thing, it encourages reduction in emissions, which has become a focus for a lot of companies who previously didn't care about it.

Past that point, I agree, there is no tax on the good you produce until it reaches the consumer.

I think this is sort of how it works already?

The diesel burned in the production of heavy oil should be tied to the tail pipe of the car that burns that gas and other products created out of the heavy oil. Essentially only consumers should pay Carbon taxes. (its why its a non starter)

If the US doesn't tax imported oil based on its carbon emissions then we shouldn't tax our exports. We should remain competitive otherwise someone else just emits the carbon.

[GGG]

Originally Posted by HockeyIlliterate

Which delays your ability to invest the amount going to your student loans by a month, which also delays your ability to buy a house, and perhaps start a family, and so on. The increase in taxation reduces the funds available that could--and often does---go to other things, which can, in the aggregate, stimulate the economy far more than the additional tax revenue would.

So your hoping the earnings will trickle down.

[Coach]

Originally Posted by HockeyIlliterate

Regardless, as evidenced by what I consider to be "slightly higher," aren't most debates and discussions regarding tax matters and what is fair or appropriate all relative to one's amount of current income or wealth?

Many are, but they shouldn't be. Discussion about tax should revolve around what society stands to gain from the policies in place, and should really only enter the realm of what it means to you personally if the difference in tax rates is keeping you above or below water. If that 3% off the top is going to cause you to default on bills, then you need to look at how much you're spending on everything and what, not just tax.

If someone's life doesn't change at all with the 3% increase (and no, taking an extra year to payoff your student loan while pulling in over 100K doesn't count, sorry.), but that increase ends up providing proper education for 1000's of kids, or keeps food on the table for 1000's of families, you're just a selfish dickhead if you want to hold onto that cash that literally won't make a difference to you.

Agree with your point about net worth though. It would be better to tax based on that and I would be interesting in seeing a proposal for such a system. As you have alluded to, there are people entering high-paying markets out of school, or high-paying high-turnover markets, that shouldn't be taxed as high as those who have been in those markets for generations and have amassed huge wealth because of it. It's not really fair to lump them together. But it's also not very fair to lump those making 50K in with those making 90K. Or those making 100K with those making 1m+. Or those making 1m+ with those making 5m+, regardless of how few there are.

[PepsiFree]

Originally Posted by HockeyIlliterate

Yes, slightly higher.



Actually, my hypo involved a $201K salary.

I thought that your first reference to $210K was just a typo, but if you really want to use that number, so be it.

Regardless, as evidenced by what I consider to be "slightly higher," aren't most debates and discussions regarding tax matters and what is fair or appropriate all relative to one's amount of current income or wealth?

At this point maybe I'm not sure what your point was since we're not discussing fairness/relativity here, so I'll restate mine:

People who make over 200K can feel free to complain but they'll get no sympathy from 99% of Canadians if they try to play the "money is tight!" card. You have no excuse. Almost all of the rest of the people in Canada live well making a lot less.

Being in the 1 or 2% of top earners in the country and complaining about money being tight? Get a financial advisor, yesterday.

[jammies]

Originally Posted by HockeyIlliterate

Net worth.

So your solution is for people to avoid taxes by not investing in anything. That sounds like a great economic plan, I wonder why no one has thought of it before.

Not to mention, say you're Donald Trump. You owe more than you own, but you owe so much the banks can't let you go bankrupt. You pay no taxes on your $10 million executive salary, because you - and this is your "reliably objective" measure - are clearly not privileged.

Or, say you are elderly and your net worth is tied up in your home. Sure, you "theoretically" have half a million dollars, but your pension, under the HockeyIlliterate fair taxation scheme, is taxed heavily enough that you end up selling your home because you are eating cat food and week-old bread scavenged from behind the local Mac's.

I think you haven't really thought this through. At all.

[Izzle]

Originally Posted by jammies

So your solution is for people to avoid taxes by not investing in anything. That sounds like a great economic plan, I wonder why no one has thought of it before.

Not to mention, say you're Donald Trump. You owe more than you own, but you owe so much the banks can't let you go bankrupt. You pay no taxes on your $10 million executive salary, because you - and this is your "reliably objective" measure - are clearly not privileged.

Or, say you are elderly and your net worth is tied up in your home. Sure, you "theoretically" have half a million dollars, but your pension, under the HockeyIlliterate fair taxation scheme, is taxed heavily enough that you end up selling your home because you are eating cat food and week-old bread scavenged from behind the local Mac's.

I think you haven't really thought this through. At all.

Lol, Jammies proving HockeyIlliterate is also MacroeconomicsIlliterate.

[jammies]

Originally Posted by MattyC

Agree with your point about net worth though. It would be better to tax based on that

No, it wouldn't. It's a very bad idea. Perhaps the least sensible taxation scheme other than the "shoot the rich and take their stuff" system the early Soviets tried out.

[Fuzz]

Originally Posted by GGG

The diesel burned in the production of heavy oil should be tied to the tail pipe of the car that burns that gas and other products created out of the heavy oil. Essentially only consumers should pay Carbon taxes. (its why its a non starter)

If the US doesn't tax imported oil based on its carbon emissions then we shouldn't tax our exports. We should remain competitive otherwise someone else just emits the carbon.

I'm not sure how you would manage that system, since every producer is going to have different levels of emmisions associated with production. I agree with you no principle, I just don't know how you could do it.

[GGG]

You could just have the burner pay for the emissions but you get a rebate on any product exported outside of Canada to a country without fair environmental policies. And have import tarrifs on all goods based on estimated carbon emissions from countries without fair environmental policies.

Essentially you raise the cost of everything for Canadians without crippling our energery and manufacturing industries and it incentivises the consumer to choose the lower carbon options.

[ernie]

Originally Posted by peter12

Maybe. I don't have a background in STEM, but I have found myself more than capable of working with STEM graduates in various marketing, planning or communication initiatives. I believe that I am compensated quite well, and that my skill-set is more or less always in demand.

You are right. Education acts as a signalling mechanism for the most part.

Sorry, this post came across as a bit too preening. What I meant was that high income based on high abilities that are probably inherited doesn't excuse you from paying taxes on your income to a degree that an increasingly jobless, and less capable majority can be take care of by a reasonable social safety net.

Don't get me wrong but those are typically quite highly paid areas and areas that people point to as where the "smart" people are (I missed law, medical doctor I consider tied up in science). That isn't to say other vocations aren't also highly paid as they can be. But many aren't or the jobs are more limited in number. And it doesn't mean those people aren't "smart" or hard working. I just feel that society gets locked into "hey you are a scientist you must be really smart!". Sure..at that science. But that person is going to be smarter than me at something...well several things. As a whole I don't like how we really do label people, starting at young kids, who is smart and who isn't smart because of what they may excel at. The kid that can compose music isn't smart...he's just talented. No he's smart.

Unless he's in Nickelback then he's neither talented nor smart.

[opendoor]

Originally Posted by PepsiFree

No and Yes.

Let's take your situation, and say you wanted to pay back your entire loan in 5 years (aggressive!).

You are looking at about 5100 a month.

You make 210K.
Your monthly NET income in Alberta would be about 9600. Taking student loans off, that leave you with 4500 a month.

If money is tight at 4500 a month, you didn't plan well.

Unless my numbers are wrong it'd actually be closer to $11K a month at $210K after deducting tax, CPP, and EI. And then when you factor in the tax deduction you get from student loan interest that adds another $500 a month or so. So with a $5100 student loan payment that person would be taking home somewhere in the $6200 range after everything.

[Coach]

Originally Posted by jammies

No, it wouldn't. It's a very bad idea. Perhaps the least sensible taxation scheme other than the "shoot the rich and take their stuff" system the early Soviets tried out.

Yeah, thinking about it deeper, you made good points above.

Really things like capital gains taxes and estate taxes try to capture what I think HockeyIlliterate is trying to expose.

[polak]

Originally Posted by HockeyIlliterate

Which is, I note, just slightly higher than the under-"privileged" person who earns $40K a year. I guess that person didn't plan well either.

If you're making 200K I'm going to be so bummed considering you don't know the difference between Gross and Net.

4500 a month Net puts you around 70K Gross. Super comfortable.

[PeteMoss]

Originally Posted by opendoor

Unless my numbers are wrong it'd actually be closer to $11K a month at $210K after deducting tax, CPP, and EI. And then when you factor in the tax deduction you get from student loan interest that adds another $500 a month or so. So with a $5100 student loan payment that person would be taking home somewhere in the $6200 range after everything.

And you'd exceed the CPP/EI maximum's on the majority of that income so won't have to pay that for most of it.

[peter12]

Yeah, so wages are obviously hyper-dependent on a lot of other factors, but they tend to be higher when you are smarter.

[peter12]

Originally Posted by jammies

No, it wouldn't. It's a very bad idea. Perhaps the least sensible taxation scheme other than the "shoot the rich and take their stuff" system the early Soviets tried out.

I didn't read anything that he said, but he knows we have capital gains and estate taxes here, right?