Happy Friday! Sign up for Morning Brew (today's sponsor) using the following link to start reading up on the daily happenings in business, finance and technology: morningbrewdaily.com/theplainbagel
@ZelenoJabko
5 ай бұрын
Canadians really are Cool, United, Creative, Kind, Stable. Now read the first letters.
@ropro9817
5 ай бұрын
In Canada, for how long do you have to live at a property for it to be considered your principal residence?
@Ronglar
5 ай бұрын
As a public CPA, our office was receiving calls all week long from clients asking about the new budget. This video was so well put together, we may start sharing it ourselves! Thanks for spreading hard info for a poorly-understood subject!
@paulkalupnieks
5 ай бұрын
The fact that the inclusion rate wasn't explained in any main stream news source I read on this, i think might have added to the confusion. I'm grateful for a proper, sane explanation of this.
@mat3714
5 ай бұрын
Channels and individuals not explaining correctly probably exploit specific angles for engagement purposes...or political goals.
@nlz1
5 ай бұрын
i wonder why media properties owned by investors living off capital rather than holding a job want to paint capital gains taxes as bad for the average non-millionaire 🤔
@Dgnmuse
5 ай бұрын
Cause they’re all owned by the right 😅
@uncomplicatedi
5 ай бұрын
@@nlz1I am also confused by this. Do you think they are only interested in their own selfish interests?
@samsonsoturian6013
5 ай бұрын
Idiot reporters aren't accountants.
@Kublai_the_dog
5 ай бұрын
I’ll tell my parents that according to Loonie doctor’s calculator, We can save $8 on the cabin tax if they die before the end of the financial year
@subspace666
5 ай бұрын
try not to tell them about m.a.i.d. :P
@foxxygearreviews7754
4 ай бұрын
I think they only have until June 25
@Direblade11
4 ай бұрын
Hilarious
@TooBadToBeAway1
2 ай бұрын
Kafkaesque. Glad someone still has a sense of humour.
@Cosmic_Hobo
5 ай бұрын
Proof that most finance influencers are idiots. They don't even know the difference between a tax rate and an inclusion rate 😂
@MillennialMoron
5 ай бұрын
Somehow I get the feeling that those influencers who don't know the difference might not be clearing 250k in taxable capital gains per year anyway 😉
@nathanlevesque7812
5 ай бұрын
@@MillennialMoron safe bet
@jamesbaxter222
5 ай бұрын
@@MillennialMoron Or they do know the difference, but they spread misinformation anyway in order to get outrage likes and follows.
@johanneskurz7122
5 ай бұрын
Which leads me to the question: why do you even have inclusion rates? Wouldn't it be easier to simply have a different tax rate?
@MatthewSmith-wv5fi
5 ай бұрын
That's utter nonsense. You didn't understand it.
@christopherthompson9578
5 ай бұрын
Please keep doing what you're doing, your channel has been of great value to me, being a young professional in Canada who doesn't work in the financial sector but still wants a sane explaination to have a passing understanding of how these changes impact me. Much respect, thank you. - PS The Peak is the Canadian equivalent of morning brew and have also found that valuable.
@SinisterLynch
Ай бұрын
Brother move to the usa, marry a american woman you find in detriot or your closest us city and become a us citizen. I make 50% more in the usa as a 23 year old than i did as a canadian at the same job while gettibg taxed 40% less. Literally taking home 75k usd a year and in Canada id get like 40k usd after taxes. I wejt from paying 38% taxes and free healthcare to like 22% taxes and i get my full coverage health care for 36$ a week. So lol yeah free healthcare aint worth 2-3k a month lmao
@hollyhollems4234
5 ай бұрын
Thank you for offering a level-headed explanation of this! It's been all over the news but until this video I had no idea the actual situation.
@la.zanmal.
5 ай бұрын
Also worth considering: everyone knows this change is coming, so if you sell now to realize capital gains you'll be selling into a market that likely won't offer you the same price it would otherwise. Simple supply and demand.
@michelchamoun9967
5 ай бұрын
That applies to canadian assets. But if you have international stocks, they wont be affected by the canadian tax changes
@NLuck-eh5cd
5 ай бұрын
Somewhat cynically, I'm wondering if that was part of the plan of this tax change. If a bunch of investors decide to dump their stock of housing onto the market, that could push prices lower in the short term, just in time for the election. Still a good policy, and I don't think we should be giving capital gains a free pass, but the timing is a bit interesting.
@meneldal
4 ай бұрын
@@NLuck-eh5cd Bursting the housing bubble is long overdue.
@Zraknul
4 ай бұрын
@@NLuck-eh5cd I'm confused by your suspicion of timing. The change is approximately 16 months before an election needs to be called by. June 2024 vs October 2025.
@sheldrake1111
5 ай бұрын
Thank you for such a great explanation. I wish all medias and channels were as clear and detailed.
@JohnnyCoulthard
5 ай бұрын
So disappointed every time I have to explain the basics of our taxes here to people. The light bulbs I see come on after explaining tax brackets alone is blinding!
@Fenriren
5 ай бұрын
Unfortunately, clear and detailed news doesn't increase viewership. Sensationalism has killed journalism
@gc.96
5 ай бұрын
Most mainstream media have no incentive to be clear given the fact that they are owned by billionaires who have their own political agenda.
@davianoinglesias5030
5 ай бұрын
😅Being clear and detailed won't generate views, people want sensationalism and drama.
@maxweinbach3996
5 ай бұрын
Which media outlet was not clear on this?
@adam872
5 ай бұрын
It seems the Canadian CGT framework is very similar to ours in Australia and there are economists here agitating to make a similar change to the discount level. I can see how a small reporting error or piece of misinformation could lead people to believe the tax rate is going up dramatically. These explainer videos are important for that reason alone.
@Xi-op7gg
5 ай бұрын
An additional thing to realize is that a couple of decades ago, Ontario doctors were not allowed to incorporate. That ability to incorporate was then offered to doctors so that in return, they would accept lower payments from OHIP. So in essence, the government said ok we will pay doctors less but they get to incorporate and save some money that way, but now we are taking that away. Doctors have no pension, sick leave, paid vacation…etc. It feels like a betrayal.
@jiecut
5 ай бұрын
The value of this tax deferral over 20 years is quite impressive. Doctors will continue saving in corporations after this change due to the power of tax deferral. Especially if they have a timeline over 8 years. Doctors can also lobby the Ontario government for more pay.
@Xi-op7gg
5 ай бұрын
Yes, I agree the tax doesn’t completely negate the advantages of incorporating, and doctors can still save and get some benefit from tax deferral and compounding. However, it still feels like a betrayal of the good faith of the original deal, like a bait and switch. Back in the day, doctors could have said no to the offer of the ability to incorporate, and just asked for higher fees up front. Also, the increased rate affects any capital gains you want to realize in the future. If a doctor has been compounding for 10-15 years, then this isn’t just more tax going forward, you are being retroactively taxed for the last 10-15 years of financial planning.
@jiecut
5 ай бұрын
@@Xi-op7gg They have a couple months to still take advantage of the old inclusion rate.
@Xi-op7gg
5 ай бұрын
True. However, realizing a huge amount of capital gains all at once has other tax implications. For example, that eats into the small business deduction limit. The more capital gains you realize, the less of your corporate income is taxed at the more favourable rate, so you lose out either way.
@RuffinItAB
5 ай бұрын
It's on capital gains over 250K a year... If you are cashing out over 250K a year just on capital gains I don't feel sorry for you having to pay an additional few thousand dollars in taxes.
@danguee1
5 ай бұрын
This is staggering that there's so much confusion and misunderstanding about such a simple concept/change.
@dpachecomartins
5 ай бұрын
Thank you A LOT for this video… no other place I saw this explanation and I did think it was 66% tax 🤦🏽♂️
@oldmanlearningguitar446
5 ай бұрын
Any business person who thinks they can just move to another country and start a business there as easily as doing so in the country they are familiar with are dreaming. Different countries have so many differences that emigrants are unaware of and/or don’t fully understand you are increasing your real risks that can easily outweigh any imagined benefits of this one thing.
@sor3999
4 ай бұрын
The rich have an attitude of not giving an inch with regards to tax rates, so whether it's 0.0001% increase or 15%, they will cry the sky is falling, make threats and run hit pieces and propaganda so you might as well go for the hail Mary. If they wanted to set up business in another country they would've done it already if the market is lucrative. California minimum wage is like $18-$20, corporations love whining about minimum wage increases, and they still set up shop here anyway because it's too big a market to ignore.
@frasersgrove4838
5 ай бұрын
Thank you TPB, great explanation on a complex issue...
@tbird81
5 ай бұрын
Pirate bay?
@snipesxiii9188
4 ай бұрын
@@tbird81 trailer park boys
@electrosyzygy
4 ай бұрын
Newly subbed and sharing. Thank you for being a voice of reason, saying things as they are and being apolitical--people lost their minds with this, the Libs communicated poorly, the media explained even less and certain opportunists had a field day.
@poxx3662
5 ай бұрын
This was a great video, as usual. I greatly appreciate you contextualizing the information (e.g. the productivity problem mentioned, graphs/tables of Canada's tax vs other countries) and giving a quick TLDR (seemingly quick enough for people already in the know to ignore and short enough to continue on with the topic you wanted to address) economic concepts like trusts. Thanks!
@theviceinvirtue
5 ай бұрын
This!!! This is what I've been saying since they released the budget. You are obviously way more eloquent in your explanation than I ever could be. So thank you for laying this down so plainly (lol). Too many click bait headlines about how everyone is rushing to sell off their assets, when we actually need more content like this.
@placeholderdoe
5 ай бұрын
Insert enraged political comment here!(I do not know what is going on I do not live in canada)
@monitoradiation
5 ай бұрын
Thank you for even knowing that we exist
@xxXXuser69420XXxx
5 ай бұрын
truly sad for canada and all my strawberry picking friends over there (not a joke)
@lilsabin
5 ай бұрын
@@xxXXuser69420XXxx How many Canadian earn (profit) $250,000 + per year ? looooooool
Happy 6th Birthday to you sir and a happy Friday to your family. Thank you for keeping it real and breaking down the bull for us mortals !!
@matthew8505
5 ай бұрын
14:30 that graph is super cool and concise. I appreciate that very clear explanation
@graham1034
5 ай бұрын
Great explanation! I've been seeing so much FUD on this lately and I'll be posting this video in response now. The change isn't nothing but it also is only a small impact on a small number of mostly wealthy people.
@wouldntyouliketoknow9891
5 ай бұрын
I dont mind paying reasonable taxes, and capital gains is a good approach to taxation since its progressive resulting in the wealthier people paying a larger share. That said, I am greatly concerned by the governments just continuing to raise taxes and invent new taxes instead of moderating spending. You cant tax your way to prosperity.
@alexander2000AD
5 ай бұрын
Another reasons Capital gains is a lower rate is due to inflation the real profit in capital gains is less than the nominal amount that is taxed. I believe in Australia they used to tax only the capital gains minus the inflation over the period of ownership. But this was simplified to a 50% discount, as in Canada, to be simpler. Australian Labor lost the 2019 election with part of their platform to decrease the discount to 1/3rd as Canada is introducing. I can see this change being fair when you have low inflation as we had from 1990 to 2020, but with the much higher inflation rate recently the 50% rate of discount is probably fairer.
@carmp3fan
5 ай бұрын
Staying invested vs divesting before June 25th also assumes govt doesn’t change the tax code again during that 10 years. Does anybody actually believe that?
@RogerAckroid
5 ай бұрын
How are capital gains by companies treated in the US? Aren't they taxed at 100% of their value(instead of 2/3 now in Canada)?
@stevenglowacki8576
5 ай бұрын
There is no capital gains preferential rate for C-corporations in the US. The only "good" thing about capital gains for C-corporations is that they can offset capital losses, which are otherwise not deductible, unlike with individuals which are allowed $3,000 in capital losses per year with indefinite carryover, while C-corporations have only a 3 year carryback and 5 year carryforward available. There are vastly fewer directly taxed corporations per capita in the US than Canada though, as pass-through entities (some of which may be S-corporations which are technically corporations but aren't taxed directly like C-Corporations) are far more popular. It would be insanity in the US to suggest that a doctor run their business as a C-Corporation and accumulate money in the business in the way that is discussed here. Instead they will have an S-Corporation (or maybe a partnership) and the business's profit will flow through to their personal return, and they can freely add and remove capital from the business without tax consequence. Please also note there is a large difference between a "company" and a "corporation" when it comes to tax law. A "company" is a generic term that US tax law never uses, while "corporation" is a specific term that is used.
@RogerAckroid
5 ай бұрын
@@stevenglowacki8576 thank you. It was really instructive
@jedro86
4 ай бұрын
Very informative. Thanks for trying to remain objective! Still feels primarily a tax on the rich, but I didn’t expect all the nuance.
@brennanhamel94
5 ай бұрын
Thank you for unbiased and easy to understand explanation 👍🏻
@ShaneWenzel
3 ай бұрын
I am pleased to see that the Conservatives are opposed to the increase in the capital gains tax. People in Canada are fed up with the federal government's habit of increasing taxes and wasting money.
@ddude27
5 ай бұрын
Great explanation. I already knew some of youtube videos made a big out of it were pushing out misinformation. I wish people would list the sources directly in their videos but a lot of them just bring up a draw pad and add theoretical numbers...
@Caffeinegoesinface
5 ай бұрын
I have been sticking random comments trying to explain that is only a 16% increase on the inclusion. But i don't think i articulated it well. This video did a great job and will be my go to to send to people to help understand the change.
@TheErvdoggie
4 ай бұрын
Richard, You're the best! Always enjoy your videos and learning soo much domestically as well as internationally on the many subjects you cover. Keep up the good work--love it! -Ervin
@ReiniBlue
5 ай бұрын
Hi dumb question - What's the point of having an inclusion rate? Why cant you tax 10% of 100% of gains versus 20% of 50% gains?
@ThePlainBagel
5 ай бұрын
The inclusion rate allows capital gains to be taxed more favourably than regular income without creating a separate set of tax rates. The government still wants to incentivize capital gains income since it promotes investing.
@ReiniBlue
5 ай бұрын
@@ThePlainBagelahhhhh that makes sense thanks a lot
@craiganderson5556
5 ай бұрын
It's good for poor people with a huge portfolio. Maybe also retirees.
@MakeThatChange
5 ай бұрын
Thank you for making this video. This is the most rational breakdown I've seen of the capital gains tax change and it's potential impact. 🚀
@telotawa
5 ай бұрын
so what you're saying is, capital still gets taxed 33% lower than labor? ....yeah corporations are still given a better hand than the average worker here
@uberboiz
5 ай бұрын
way to miss a point....
@High1QWealth
5 ай бұрын
Should be like that! You take no risk as a worker without equity!
@Grizabeebles
5 ай бұрын
I'm starting to think that having only one tax rate for personal income, corporate tax and capital gains would actually lead to lower net taxes for all categories. Even just the cost savings from not having to set up and maintain shell corporations and complex tax-avoidance structures would add up to something significant.
@dmitripogosian5084
4 ай бұрын
Taxes are way of the government to promote a particular type of behavior. Especially here in Canada, where federal government has practically no other instruments, since most of everyday internal life is provincial jurisdiction, variations in taxes just often for this purpose. Here it is all about real estate
@0xCAFEF00D
5 ай бұрын
10:20 Surely it's not that expensive to do this in Canada. A similar situation here in Sweden cost me an equivalent of 2700USD.
@barettmac
5 ай бұрын
We know how expensive it is, the Government of Canada is estimating that increasing the capital gains inclusion rate will bring in about 4 billion per year in new revenue, that's 4 billion per year not going back to shareholders of these corporations.
@freedomlife3623
5 ай бұрын
@@barettmacwell, someone have to pay for all those programs, why should capital gain being taxed much lower than regular income? We have a corporation, will be happy to contribute a bit more to build a better community.
@AntonPNym
5 ай бұрын
@@barettmac That said, after a good 30 years of near poverty I landed into some investment money (the old fashioned way, I inherited it) five years ago and was shocked to discover how easy it was to build capital one you had some to invest. It's been awfully close to a free ride for me, and I'm as sceptical of free rides as Adam Smith was; so I welcome the increase in inclusion rate if it's going towards fixing the market failure we're seeing in housing.
@heshanpalliyaguruge6333
5 ай бұрын
Just completed my tax course for my undergrad and love how you covered all the different tax impacts! Amazing content as always Mr. Richard
@Blinky888
5 ай бұрын
My guess is that anyone that could be affected by this significantly will probably be getting a big raise to pay for it.
@justinodonohue8977
4 ай бұрын
Where do our taxes go? How much of a benefit do Canadians get for having such high tax rates? The Canadian health and education system have major problems. The military is underfunded. Where and how are these taxes used? What’s the taxation to benefit ratio?
@dani2cute4u
4 ай бұрын
This tax system only encourages mediocrity.
@JunSian1001
5 ай бұрын
For every crave-out and loophole, there will be tax lawyers who help you to avoid the higher tax.
@geekinasuit8333
5 ай бұрын
It's not that simple. There's only so much that can be done, and going down various loopholes is never cost free, often times it can be counter-productive and may have risks that can go the wrong way. In addition, the legal fees cost money, which means there's less take home to re-invest.
@samsonsoturian6013
3 ай бұрын
Only so much they can do and it's only worth their fee if you owe a large amount
@RyanPatrickOwens
4 ай бұрын
The real concern is deemed disposition at the death of the second spouse; I met recently with a registered nurse who was leveraged to the hilt with mortgages on rental properties. The new capital gains change will make it difficult for her to sell the properties off while still making a decent profit to fund her retirement; but it would be even worse if she were to leave the properties to her children. The difference thanks to the new inclusion rate is going to be almost a million dollars in liability. She is not one of Canada’s wealthiest people.
@samsonsoturian6013
5 ай бұрын
Self-employed guy here: There's a host of reasons to incorporate even if it's a sole proprietorship. My reason my employer forces us all to make companies so he can deny that we are employees, but the non-compete agreements we signed are completely unenforceable.
@corail53
5 ай бұрын
Sounds like the entertainment industry...
@jshowao
5 ай бұрын
Not uncommon for some businesses to do this, some even only employ workers outside the country so they can cut down on paperwork and taxes. It's a shady as hell practice.
@samsonsoturian6013
5 ай бұрын
@user-oj7uc8tw9r Not always. When outsourcing stuff online you're competing against people in third world countries with internet so often the best bang for the buck is someone who speaks English as a second language.
@jshowao
5 ай бұрын
@@samsonsoturian6013 Nearly all foreign countries have people who are trained to speak English as a second language and rather well in technical professions. It is not as competitive an edge as you think. The US is way behind in this regard.
@bf19881988
5 ай бұрын
I dont believe a sole prop is the same as incorporating
@matthewdavis7319
5 ай бұрын
Informative and useful. Thank you for providing valuable input.
@Flincher14
4 ай бұрын
I'm embarrassed how small this change is and how dramatic of a controversy has been created out of an ant hill.
@mat3714
5 ай бұрын
Oh no !! X is mad about it, I'm sure it's all valid, balanced and not at all filled with conspiracy theories.
@7PropagandaPanda7
5 ай бұрын
you can just tell us directly you are poor
@mat3714
5 ай бұрын
@@7PropagandaPanda7 pretty sure that rich people don't make stupid reply like this
@Peter-q1p7t
5 ай бұрын
You can directly tell us you're a conservative @@7PropagandaPanda7
@erikzarts
5 ай бұрын
@@7PropagandaPanda7 Bot names aren't getting too creative these days.
@nicholasdaily2589
4 ай бұрын
It’s because wealthy people have done a very good job of trying to steer people to lean right, which hardcore favours the rich and corporate business. Elon himself probably absolutely hates this idea because it just means he pays more in taxes, which he should. (Not him specifically but people like him)
@joshuacoll.6100
4 ай бұрын
Thank you so much for these videos bro. We really need your dry Canadian wit to cut through all the rhetoric, God bless.
@tysonkrehnke2835
4 ай бұрын
That's weird. For inheritance In the US there is a step up in basis. So when you get an rental property purchased at $100,000 and the FMV at date of death is $200,000, you now have $200,000 of basis to help reduce any future gains going forward. Pretty nice deal.
@saltyBANDIT
5 ай бұрын
Good idea honestly but without exception, for example, for clinic owners i fear this will hurt doctors who have incorporated to fix income from owned clinics and Canada isn’t in a place where the medical system can take any hits. With that said however, it’s at least a semi positive step in a decent direction.
@epictetus3406
5 ай бұрын
Step in the right direction? Making it less favorable to set up a business in canada while giving more money to the state to waste is a step in the right direction? When did so many people become communists? Is it the younger generations?
@ultimetacooler
4 ай бұрын
@@epictetus3406a lot of people on the internet never leave their house so they don’t understand how the world works
@jeremynewell9903
5 ай бұрын
Haha, I in Canada I pay a set rate on non-eligible dividends so the government makes me feel good. Then I pay a "gross-up" amount of 15% on top of that. Everything is a money-grab up here.
@TheAnimalv12
5 ай бұрын
I guess I'll hold on to my bagel butts NFTs for awhile longer.
@GordonLonghouse
5 ай бұрын
Expect to see wash sales whereby a owner of an appreciated asset sells and buys it the same day triggering a capital gain taxed under the old rate and a new higher cost base for gains accrued in the new rate.
@rhythmandacoustics
5 ай бұрын
I am still too poor to be taxed at that rate.
@extremepsyche3135
5 ай бұрын
Tax for thee - not for me
@everydayfun9531
4 ай бұрын
Bruh I'm unemployed and broke.
@dmitripogosian5084
4 ай бұрын
With corporations i suspect main target are individual people owning real estate through corporations. Very popular scheme to avoid/reduce taxes when selling reselling real estate
@jacoboblanco1555
5 ай бұрын
Basically if you see any outrage online, it’s probably misplaced and misinformed and you should ignore it.
@samsonsoturian6013
5 ай бұрын
If there's a meme about it, it's usually bullshit
@danielquintieri
Ай бұрын
It was literally just a way to force people to selk and make their budget numbers look better with 0 regard for actual people
@fei287
5 ай бұрын
Thank you Mr Bagel but I haven't paid taxes since 2008. I learned that if I report my income as $0, the government pays me instead.
@jeremybrummel3254
4 ай бұрын
I hate the Classist idea that the wealthy should pay a higher tax percentage than everyone else, be it marginal tax system or outright wealth tax.
@mazimadu
4 ай бұрын
I also hate this idea, because of the prevailing idea that "Canada is a wealthy country". And considering how prices have increased, it means you HAVE TO BE WEALTHY jùst to live in this country
@AmanSS890
3 ай бұрын
Canada keep taxing the doctors that are business owners, and the people that have grocery stores ? And the people that have e restaurants. And people that have a cottage. 🤦♀️. So know if I want to sell I will be taxed to death. No person in there every loving mind would want to do business in Canada . After this . Find someone were else to open a pharmacy, or doctor office , as an investor I can’t catch a break in Canada. This is way no doctors want to start a practice in Canada .
@rileynicholson2322
5 ай бұрын
From the political perspective, the important takeaway is that only the wealthiest people are likely to be directly effected. This isn't a tax on middle income earners because they limited capital gains and access to tax sheltered investments like principal residences, TFSAs, RRSPs, etc. Yes, as with all progressive taxes, there are some concerns about discouraging productivity or investment in high income earners, but that really becomes a matter of cost benefit analysis based on where revenues are being spent.
@BorealMushroomms
5 ай бұрын
Most doctors and dentists will be effected.
@bogeybichon7000
5 ай бұрын
ANYONE with a cottage, investment property, self-employed person with a holding company (NOT just doctors, dentists etc but also blue collar professions such as plumber, electricians etc), anyone who has an ownership interest in a Canadian controlled small business that is not publicly traded. It has been estimated that it could directly effect 20% of Canadians at some point in their life.
@BigRedNutcase911
5 ай бұрын
@@bogeybichon7000 What capital gains are those small businesses even earning though? As TPB mentioned, they already get tax benefits for selling the business so it's moot there. Plumbers, electricians, etc aren't exactly day trading with their business revenues, so what small businesses are affected?
@samsonsoturian6013
5 ай бұрын
From a macroeconomic perspective it doesn't matter where you siphon off money from the economy all that matters is how much you siphon. And it does get really technical as there's no one tax that truly "targets the rich" due to technicalities.
@schoeyy5468
5 ай бұрын
@@bogeybichon7000oh no, those people with investment properties that increased in value by 250k or more are going to be taxed a bit more!! How will they cope
@waylaidsavant
4 ай бұрын
Interesting - here in Australia, corporates are entitled to no CGT discounting.
@cabbagedestroyer1693
5 ай бұрын
Imagine when you die, you pay tax. But if you leave any property behind for your family, you get taxed as well. Cant even escape tax in death.
@chillinchum
5 ай бұрын
Are you just learning this now?! That's something that really irks me about folms complaining online sometimes, they are complaining about something they learned for the first time that's been around for decades, or in some cases centuries, but treating it as though it's a new thing. I despise the concept of generational wealth, so I have little sympathy about estate tax. However, if it so bugs you, remember to go do something political about it. ...or do as a lot of other folks might say, leave. I can think of a few reasons why myself. But taxes aren't necessarily one of them. That said all the reasons I can come up with for leaving were all problems we've been dealing with for over 20 years. Recently heard someone say you can track the problems all the way back to Pierre Trudeau...and I'm going to guess it can be taken further.
@cabbagedestroyer1693
5 ай бұрын
@@chillinchum Centuries? Do you know how the tax system has changed over the past 50 years? It's a simple question. What percentage of the population had to pay death tax in the 1980s?
@anthonybousquet3590
4 ай бұрын
@@cabbagedestroyer1693 Yes, centuries. France has had inheritance taxes since the French Revolution and Britain since the middle of the 19th century. The concept of taxing inheritances isn’t exactly recent.
@cabbagedestroyer1693
4 ай бұрын
@anthonybousquet3590 That is extremely misleading. Yes there was a concept that only applied to 0.1% of the population. Inheritance tax in Europe applied to massive estate owners, and did not apply to the common people. Inheritance tax in the US didn't even exist until 1980s, in which only about 1% of the population was affected. In the British Empire, the succession duty act, again, only affected a small proportion of people and only taxed people between 1 to 10% as opposed to 30 to 50% that we have today. In another word, unless you don't think there's a difference between 1% of the population being taxed at a maximum 10% on Inheritance vs. 100% of the population being taxed at a minimum 30%, then I don't know what to tell you.
@joeisawesome540
4 ай бұрын
@@cabbagedestroyer1693 because back then you dirty peasents wouldn't have anything to pass it on... just like most people in Canada.. you don't have that much to pass on..
@daviddiehl5792
5 ай бұрын
I would like to hear about capital loss and how to use them Thanks for the capital gains tax talk.
@luislptigres
5 ай бұрын
Great way to disincentivize 250K capital gain.
@Belgianperspective
5 ай бұрын
Sometimes… it is better to LEAVE Canada once one gets the passport to avoid high living costs and crappy services (healthcare among others) and high taxes. It is sometimes a good idea to use the passport and experiences (make sure it is not from those survival jobs they lure to many immigrants) and use that elsewhere… to me, 3 years after uniting here, I knew I wouldn’t retire here nor buy a house here (not worth it)!!!
@danwelterweight4137
4 ай бұрын
That is exactly what I am doing this summer.
@dmitripogosian5084
4 ай бұрын
So where do you suggest to go for an excellent health care ?
@snave4o4
5 ай бұрын
This is the first video on this issue that breaks it down in a clear and concise way
@SniperReady
5 ай бұрын
These tax schemes rarely affect anyone who ever comments on them. to be the sort of person withdrawing $250,000 in capital gains you would have to be like one of Canada’s 0.1% wealthiest. The change in taxes would be something like $20,000 on an annual income over $500,000 (with your personal income being $250,000 or more, and your capital gains being $250,000 or more). That would be about 4.5% of your income. And that’s assuming the tax applies to that $250,000, and not the amount after (I’m not clear what the case is.) At an average return of about 10%, you would need to be holding $2,500,000 or more in investments to see capital gains reach that level. This is such a negligible amount for people that wealthy, and all of you here are not that wealthy. Some of you may make several hundred thousand per year, and even you will not see any of this effect.
@questioner1596
5 ай бұрын
I think the biggest segment of "normal" people affected would be retirees selling their house or cottage when downsizing (assuming it's not the "principal"). Many $250,000 houses 15 years ago are now worth $1,000,000+.
@jimlamb7642
5 ай бұрын
Because governments never expand the pool of who it effects after they get a new tax law passed.
@curtis1397
5 ай бұрын
Bad take, im a middle class independent business owner and it affects me. I am no where near even the top 1% and will likely have atleast 250K gains next year. Either your under 30 or work at mcdonalds.
@SniperReady
5 ай бұрын
@@questioner1596 If they have over $250,000 in equity on a non-principal property, are we worried about how that extra 8% at most in taxes is going to affect them? This is the whole point. People who have incredible wealth can afford the extra tax. Did I complain about paying $60,000 in taxes after years of never making more than $25,000, because my income went drastically up? No, grow a pair and contribute to your community.
@SniperReady
5 ай бұрын
@@jimlamb7642 because wealthy people cannot possibly afford a small percentage extra in taxes.
@kevinbaldwin7805
3 ай бұрын
I will ask the important question. Why does the Canadian government need more money?
@MasterMind468
5 ай бұрын
An average family can’t even buy a detached home anymore, yet the rich who have more than one home, or a huge investment account are outraged at this tax? @ThePlainBagel, can you comment on this psychology. I have saved up over 100k before age 30 and i have to live in appartments my whole life, and the wealthy with cottages are complaining?
@flakgun153
5 ай бұрын
My life sucks so people who have it better than me should also have their lives suck? This isn't going to make anything cheaper for you at all. Just going to make you feel better by sticking it to people you are jealous of
@MasterMind468
5 ай бұрын
@@flakgun153 nope, you just need to pay your fair share. Nice try
@flakgun153
5 ай бұрын
@MasterMind468 I'm not even Canadian. All I did was explain *your psycology*. And the idea of a fair share of people income to take away from them by force is complete bullshit anyway. Taxes should not be higher than 20% for *anyone* for any reason. That's an opinion. Just like any opinion on what a fair rate is.
@MasterMind468
5 ай бұрын
@@flakgun153 in canada, there is a housing crisis. The government needs revenue. Wages are low and the richest canadians are making large capital gains, and pay less tax on that than say, a nurse saving lives earning a salary. Nobody needs to generate infinite free money
@flakgun153
5 ай бұрын
@MasterMind468 Yes and do you think taxes magically make houses cheaper. If anything this makes it harder for the people who put down money to actually build new construction to justify doing do. And it's not about how much money people NEED. If you want a society that looks like that then go to North Korea. Our society works off of what people want and incentives to do. And the Canadian government would need far more money than it actually could ever get off of taxes to build significant amount of housing itself. And again. Am I wrong in the way I described your psycology? If you actually cared about resolving the housing crisis you would be focused on making it easier to build by any means necessary. Instead you're focused on punishing people who have more than you for the crime of having what you want. Realistically Even if Canada mobilized every single property developer and construction worker it would take decades to resolve. And that's absolutely not going to happen if you make the people who actually know how to navigate the insane amount of beaucracy it takes to build anything and encourage them to build in foreign countries instead.
@Noxshus
4 ай бұрын
I love the tax bump, I would just love to see carve-outs for the public rage inducing instances; I think a lot of people would be pacified if their family cabins that they never really paid for were exempt, for instance.
@FaustsKanaal
5 ай бұрын
Taxation like this is why people set up Holdings in tax havens. Sounds like tax the rich, in effect its more like tax the self employed and small business owners. It may sound like someone who is a millionaire is wealthy, but if thats a paid off house and investment account, then thats their pension. On a million earning 5% you only get 50,000 a year before taxes. Thats not "taxing the rich". And furthermore, these taxes which raise dividend tax and so on, also affect salaried workers in that their pension funds also have to pay more taxes now. Meanwhile the actual rich who have in the hundreds of millions, they set up legal constructs avoiding any tax at all. And increasingly, as a small business owner, I feel like we are idiots for not doing the same.
@amando96
5 ай бұрын
No point in not doing it. These people hate you.
@ziglaus
5 ай бұрын
@@amando96the rich, you mean?
@ziglaus
5 ай бұрын
This is exactly the tool to close those loopholes though. We should support any law that makes tax evasion more difficult, as anyone who isn't paying their taxes is effectively stealing from you
@Hyperpandas
5 ай бұрын
Not sure I follow your argument here. If a small business owner has invested a million dollars and realizes a capital gain of 5% each year, then 1/3 of that gain is still tax free and the other 2/3 is subject to your normal corporate tax. The only change is to the inclusion rate, which was 1/2. Not sure that most small businesses even have capital gains unless or until they are sold or have to dispose of some property. In the case of the former, they still get preferential treatment than any salaried worker receives by accumulating wealth through their labor. Finally, I don't believe dividend rates are affected by this at all. So small business owners can still pay themselves a small salary and dividends each year, once again resulting in lower taxes than salaried workers with equivalent gross incomes.
@FaustsKanaal
5 ай бұрын
@@ziglaus None of this makes evasion more difficult. It just taxes the people who cant evade more.
@jacobl2222
5 ай бұрын
Thanks for the clear analysis, and explaining the ACTUAL pros and cons. As usual, it seems the people out there whinging the hardest about this don't seem to understand how it actually works. Either that or they're intentionally distorting it to push an agenda.
@chihuadog
5 ай бұрын
You don’t know what you’re talking about. This is essentially a 33% increase in tax(67% inclusion divided by 50% inclusion). For a small business to realize 100k of gains they now have to pay an extra 10k in taxes. That’s huge.
@Oblech1
5 ай бұрын
@@chihuadogPlease learn mathematics
@alexmikhylov
5 ай бұрын
ceneda is a stailed fade
@jeremynewell9903
4 ай бұрын
I work in construction and use a corporation for my small business. All told I'm still paying 38%
@adamhacker129
5 ай бұрын
Richard bringing sanity yet again to online rage.
@1984Phalanx
4 ай бұрын
Thank you for the information. I thought they were raising taxes on home sellers at a time when interest rates are high.
@forbiddenera
5 ай бұрын
Of course people see this and think its just 66% tax and those same people think it will affect them when it wont and blame Trudeau for raising their taxes 😂😂😂😂
@jonrandellsmith
4 ай бұрын
This is a really helpful explanation, thank you! Really basic question here: the people you mentioned affected by this change (doctors, family property owners, etc), they are already affected by capital gains taxes before this change, correct? It's just that now, they're on the hook for more? Is that right? Anyone who can offer insight here lmk
@BrotherAlpha
4 ай бұрын
7:00.... MOST PEOPLE DON'T OWN A COTTAGE OR A CABIN! I know some non-rich people will have one, but it is just funny to hear someone talk about every day people with a cottage.
@Vnifit
2 ай бұрын
It's actually a lot more common than you'd think. My family bought a cottage out in Prince Edward County back in the 60's on a blank plot of land for around $8,000 and built a small cabin. That was done on my grandfathers single-income salary. My parents are both teachers so they aren't poor, but solidly middle class. If my father wanted to transfer the property to us one day (perhaps in 20 years) there is no way we could ever afford the capital gains on the place, it'd be astronomical. Prices have gone nuts and the quiet rural area we once were located in is now much busier, and the old cottages nearby have been buldozed for huge expensive places for the rich. Without an exemption for cottages (perhaps those over a certain age/been in the same family) it will only just transfer more real assets from the middle class to the upper classes. You are right that nowadays if you are purchasing a cottage you are probably in the upper class, because properties are insanely expensive anywhere and everywhere. But back in the day, this was not the case, and it was filled with middle class earners, just like all of our neighbours used to be. Now cottage country is becoming exclusively a rich persons playground.
@Elemblue2
5 ай бұрын
Tax conversations are 🔥
@stevelindsay3643
4 ай бұрын
IT'S NOT A TAX AGAINST THE WEALTHY, IT'S A TAX AGAINST ANY AND ALL CANADIANS WHO INVESTED OR INHERITED PROPERTY. IT'S THEFT, IT'S SICKENING
@wnose
5 ай бұрын
In 1980, the corporate tax rate was 36%. Today? 15%, one of the lowest in the OECD. Corporations only contribute 25% to overall taxes collected. Over the same period of time, the feds cut building in social housing, and reduced proportionate expenditure in defense and health. So here we are.
@samsonsoturian6013
5 ай бұрын
So what? Companies just pass those expenses onto their customers.
@Jacob_S13
5 ай бұрын
Why dont u pay your own health and housing expenses then 😅 Bums being bums
@jeremynewell9903
4 ай бұрын
This one doesn't bug me as much as the 15% "gross up" on dividend income.
@electricerger
4 ай бұрын
I wonder, would you be able to get a Home Equity Loan to pay off the gains taxes from inheriting a property? Yes, you'd still pay for it, but it's an alternative to having to sell it at least.
@RealDarkBlade
5 ай бұрын
I don't have any skin in the canadian cgt but some items they claim to be the cause for the increased taxation are weird. Like..."we need to tax you more so we can build houses". Is the canadian government building houses? Are these all social housing projects? Else what is the purpose...get more money from people to give to companies to build houses than they can then...overprice and sell to said people?
@Ilamarea
Ай бұрын
Why are things to stupidly complicated with inclusion rate?
@hodokwaja
5 ай бұрын
People should want the government to stop increasing spending. And let the market to work its way naturally. Rather than they spend money by printing and artificially controlling by increasing taxation.
@laundrygoddess4
5 ай бұрын
They should want the government to do both
@neilbertram1922
4 ай бұрын
People create corporations and trusts to avoid tax. The government is simply making this a little less advantageous. It's important for all of the moaners to remember that the rest of us have a 100% inclusion rate on our deferred tax savings (RRSPs). Furthermore, raising the inclusion rate on capital gains for real estate investments is not enough. Folks using real estate to save for retirement have been too long incentivized to eschew RRSPs, and have subsequently ruined the housing market for new entrants.
@EdwardMaxedon
4 ай бұрын
So let me get this straight. The 99% of Canadians who will likely never be effected by this increase on capital gains for the
@nonenone5387
5 ай бұрын
So basically its mostly a nothing burger but the fear that governments could start taxing people with money is the bigger issue.
@AA-il9pc
5 ай бұрын
“People with money”. You mean people with a below average retirement? Children inheriting a family home that has potentially been in the family for generations?
@geekinasuit8333
5 ай бұрын
Who has a home worth less than $250K? How many Canadian's, who earn an average wage, also now have a home that's become worth well over $1M? The governments' perception of "wealthy" is incredibly warped.
@jiecut
5 ай бұрын
@@AA-il9pc This has no impact on principal residences.
@AA-il9pc
5 ай бұрын
@@jiecut Not every family home is a principal residence
@dmitripogosian5084
4 ай бұрын
@@AA-il9pcthen it is not a "family home"
@df5826
4 ай бұрын
Investments aren't keeping up because wages haven't kept up for over 30 years. This affordability crisis was caused by wages not being kept up to cost of living for 30 years. We make penny compared to our parents but hey we'll be fine right? Why aren't we taking about this?
@anothermike4825
5 ай бұрын
Do you think people are going to sell their stock to take gains before taxes? Rich people deserve more taxes, they are the ones who reap the rewards of a stable country that protects their wealth.
@jimlamb7642
5 ай бұрын
Someone has more than me, punish them for it. Sounds good till you realize that by virtue of posting here you clearly have enough money to have a computer or at least a phone with internet access which means you have way more than millions of people on the planet, you should be stripped of all of your assets save for enough to have a tent and one meal a day so that those people can have a better life too.
@laundrygoddess4
5 ай бұрын
@@jimlamb7642going extreme in any direction sounds dumb. It's sensible to say that richer people can afford to pay more taxes. This is especially true since the rich often end up paying a lower percentage of tax on their income
@Madchris8828
5 ай бұрын
@@laundrygoddess4 at the highest end they don't even pay taxes many times, so what do higher tax rates actually do? Burden the middle income more. The richest people can and always will be able to avoid paying as much taxes because of legal writeoffs. Unless you completely overhaul the system that won't change either. And what do higher tax rates give you? More foreign wars? Certainly not better education or better roadways from anything I've ever seen.
@laundrygoddess4
5 ай бұрын
@@Madchris8828 this is one way to tighten the corporate loophole. You can't just go crazy all at once or there will be chaos. Little bits at a time is more successful in the long run
@jimlamb7642
5 ай бұрын
@@laundrygoddess4 You have to go to extreme to make a hyperbolic point because people do not understand complicated nuance as evidenced by the fact that you believe that is true. Everyone pays the same tax on the same brackets that they fall into, 0% up to a certain minimum amount, 10% on the amount above that to another level (in the US), 12% between two other income levels and so on (changes every year or two hence why not quoting the specific amounts). When journalist tell you 'the rich' pay less taxes as a percent, they tell you a half truth because they conflate income tax with capital gains tax and compare them as if they were comparing like things. But the point stills stands because there are many people in the world that think "poor people" in western countries, are spoiled, rich, cry babies and think that those 'rich' people should give up their 'wealth' to help the situations in impoverished places... Rwanda, Haiti, South Africa, as just 3 examples.
@BuddyMcNugget
5 ай бұрын
Sounds good to me. Thanks for the great explanation!
@kristopherdickson6606
5 ай бұрын
Capital gains tax is 50% and they're increasing it. It's absurd to think anyone, regardless of political affiliation could ever be okay with that
@samsonsoturian6013
5 ай бұрын
Contrary to popular belief, politicians don't know a damn thing about stocks.
@joshuamacdonald4913
5 ай бұрын
I am personally for this. I would like a better system in place but its a good starting point. Considering around 80% of Canadians make $100k or leas this wont really affect “the people” more of the financial elite with very few exceptions. But there seems to be some situations where there could be some more exceptions. Honestly I would put in a clause exempting practicing doctors. Even the possibility of them paying less then the current amount. I am sure there are other areas that could be thought out better.
@geekinasuit8333
5 ай бұрын
I'm one of the supposedly few people targeted by the cap gains tax increase. There's also the little discussed, "alternative minimum tax" (AMT) that I am now exposed to starting this year. The AMT is overly complex and, along with the increased cap gains taxation, will take a significant bite out of after tax profits. The less I take in, means I'll continually be re-investing less back into Canada's economy over my lifetime, which is a lose-lose scenario for everyone. As a Canadian investor and business owner, I will not vote for this government at election time. We need a strong economy that encourages entrepreneurialism, not a weaker one that discourages investments and risk taking.
@dmitripogosian5084
4 ай бұрын
Less you take out and more reinvest, more you can will transfer to your heirs when you die, and here the taxes come, so Government does not lose, it can wait a bit
@geekinasuit8333
4 ай бұрын
@@dmitripogosian5084 That's not how it works. I will not take out less because the money is worthless to me after I'm gone.
@geekinasuit8333
4 ай бұрын
@@dmitripogosian5084 Encouraging the hoarding of wealth is very bad for the economy. Money is worthless unless it is put to use, which means spending it. What I originally said holds, I will pay less taxes because I will take home less after the tax increase. I will invest less back, which means less future cap gains and less dividends. When I earn less, it means less tax the government gets, and since I will have less money to spend, it means less goes back into the economy and less gst+pst goes into the coffers. The cap gains increase is a lose-lose tax increase. I'm considering options, such as leaving Canada and investing elsewhere, that's how discouraging the situation has become. A government that is openly hostile towards successful people, using insulting discriminatory language, and is actively penalizing those who invest and take risks, is not a government I will ever support.
@geekinasuit8333
3 ай бұрын
@@dmitripogosian5084 I calculated that the gov will actually get less even when I die, simply because my investments will not have grown as large as it otherwise would have, had they instead taken less from the start. It's firmly a lose-lose tax in all scenarios. The only case for it being a "win", is in the very short term, after they get a cash infusion caused by people being pushed into realizing gains early before the 25th. What will the gov do with the case infusion? We can only guess, but most likely they will blow it away in a very short time on more of the same old waste as before.
@Vroomfondle1066
5 ай бұрын
The question is, what exactly are the reasons that all these capital assets are continually going up in price all the time?
@arofhoof
5 ай бұрын
"redistributing wealth" Well then redistribute it to citizens, not politics.
@chuck600
5 ай бұрын
Sorry I'm sneezing out here where are those citizens you're talking about? Did you make them up? Anyway I reeeeeally need a third yacht (for work reasons) see ya
@2639theboss
5 ай бұрын
So how exactly do you suggest redistributing wealth to citizens without involving politics, and how exactly do you think its currently being redistributed to the very descriptive word, "politics"?
@hopelessdecoy
5 ай бұрын
@@2639theboss I think they are implying by the time it reaches the regular person 37 agencies and 18 councils have deducted their fees and taxes or that the gathered taxes get distributed towards projects and policies that don't ever bear fruit and so it goes to "politics".
@2639theboss
5 ай бұрын
@@hopelessdecoy So they want a system designed to govern 40 million people to be perfectly efficient?
@doom2060
5 ай бұрын
Where do you think all the money is going?
@vonniemichelle3670
5 ай бұрын
This was informative. Thank you.
@raveensingh7095
5 ай бұрын
I look forward to taking my hard earned dollars to another jurisdiction and putting it there. I already have stopped investing in Canada, and have real estate outside Canada - and will never invest in Canada again. Thats not on my, its Trudope.
@intothevoid7641
5 ай бұрын
So what you're saying is you're committing tax fraud?
@raveensingh7095
5 ай бұрын
@@intothevoid7641 nope, its all on the up and up. I have legal residency in the new country. Im retreating from Canada, and when the right time comes, pay the exit tax and exit Canada legally. I pay tax in the other jurisdiction as well.
@Jacob_S13
5 ай бұрын
@@intothevoid7641You have zero clue tf is going on... No wonder u are a bum 😂
@everydayfun9531
4 ай бұрын
@intothevoid7641 he ain't committing tax fraud he's being smart for once because there's no point paying high taxes if it isn't used to fix the country's problems
Пікірлер: 1 М.