New report finds low corporate taxes are harmful to the economy

[TenPenny]

That is the important part.


Should people pay the same proportion of their income, or should there be some adjustment for the fact that basic living (food, housing, etc) costs pretty much the same whether your income is $5,000 or $150,000, and therefore some adjustment needs to be made to compensate for the idea that a large income leaves more 'discretionary' money?


I'm not arguing either way, I'm just saying, it's all in how you define 'fair'. And that's what makes it different for different people.

 

[Hoid]

flat taxes infer to me that poor people pay more. We currently graduate the system so that the more you make the more you pay, therefore if the system changes to a single rate it must rise for those in the lowest brackets.

 

[petros]

regardless, my comment was on the heels that Corporations aren't paying enough taxes....

I think we need to start at page 1 with definitions of the types of business registrations and who pays what.

Sole proprietorship

With this type of business organization, you are the sole owner, and fully responsible for all debts and obligations related to your business. All profits are yours to keep. Because you are personally liable, a creditor can make a claim against your personal assets as well as your business assets in order to satisfy any debts.

Advantages:

Easy and inexpensive to register

Regulatory burden is generally light

You have direct control of decision making

Minimal working capital required for start-up

Some tax advantages if your business is not doing well (for example, deducting your losses from your personal income, and a lower tax bracket when profits are low)

All profits go to you directly

Disadvantages:

Unlimited liability (if you have business debts, claims can be made against your personal assets to pay them off)

Income is taxable at your personal rate and, if your business is profitable, this could put you in a higher tax bracket

Lack of continuity for your business if you are unavailable

Can be difficult to raise capital on your own
Partnership

A partnership is a non-incorporated business that is created between two or more people. In a partnership, your financial resources are combined with those of your business partner(s), and put into the business. You and your partner(s) would then share in the profits of the business according to any legal agreement you have drawn up.

In a general partnership, each partner is jointly liable for the debts of the partnership. In a limited partnership, a person can contribute to the business without being involved in its operations. A limited liability partnership is usually only available to a group of professionals, such as lawyers, accountants or doctors.

When establishing a partnership, you should have a partnership agreement in place. This is important because it establishes the terms of the partnership and can help you avoid disputes later on. Hiring a lawyer or other legal professional to help you draw up a partnership agreement will save you time and protect your interests.

Advantages:

Fairly easy and inexpensive to form a partnership

Start-up costs are shared equally with you and your partner(s)

Equal share in the management, profits and assets

Tax advantage — if income from the partnership is low or loses money (you and your partner(s) include your shares of the partnership in your individual tax returns)
Disadvantages:

There is no legal difference between you and your business

Unlimited liability (if you have business debts, personal assets can be used to pay off the debt)

Can be difficult to find a suitable partner
Possible development of conflict between you and your partner(s)

You are held financially responsible for business decisions made by your partner(s); for example, contracts that are broken

Legal issues for small business

Do you really need a lawyer when you start your small business? Find out how legal counsel could benefit your business.

Corporation

Another type of business structure is a corporation. Incorporation can be done at the federal or provincial/territorial level. When you incorporate your business, it is considered to be a legal entity that is separate from its shareholders. As a shareholder of a corporation, you will not be personally liable for the debts, obligations or acts of the corporation. It is always wise to seek legal advice before incorporating.

Advantages:

Limited liability

Ownership is transferable

Continuous existence

Separate legal entity

Easier to raise capital than it might be with other business structures

Possible tax advantage as taxes may be lower for an incorporated business

Disadvantages:

A corporation is closely regulated
More expensive to set up a corporation than other business forms

Extensive corporate records required, including documentation filed annually with the government

Possible conflict between shareholders and directors

You may be required to prove residency or citizenship of directors

 

[Jinentonix]

Look, we already know cap's an expert on pipeline projects (none of which have been built yet), petros' is an expert on the absence of oil subsidies (which have already been confirmed by numerous sources), and Angstrom is an expert on life (heh).

And of course we can't forget you and your expertise in "green energy" (wind turbines saved Ontario don'tcha know). You can't tell us how or why, just that we should take your word for it.

Your "expertise" in economics was also on display when you pointedly claimed some time ago, "The economy doesn't matter."

Look, we already know cap's an expert on pipeline projects (none of which have been built yet)

None? So all those pipelines that already exist in Canada are just fig newtons of our imagination?

 

[Cannuck]

flat taxes infer to me that poor people pay more. We currently graduate the system so that the more you make the more you pay, therefore if the system changes to a single rate it must rise for those in the lowest brackets.

That's only if you ignore the tax breaks the wealthier taxpayers get. When it's all said and done, I pay nowhere near the rate for my income. I posted a few years ago that I paid about 8% while earning 6 figures

I think we need to start at page 1 with definitions of the types of business ...

You need to supply links when you cut and paste

 

[petros]

You need to supply links when you cut and paste

Nope.

 

[captain morgan]

I guess so if driving some taxpayers to the point of starvation is fair. I'm sort of in favour of those of means paying an extra 5% just to cover the "cracks" the handicapped could fall through.

You're talking about welfare at this point and it's not an extra 5%... The difference between low and high is North of 30%

That's only if you ignore the tax breaks the wealthier taxpayers get. When it's all said and done, I pay nowhere near the rate for my income. I posted a few years ago that I paid about 8% while earning 6 figures

What tax break s are you referring to?

 

[Twin_Moose]

It is if that is your definition of fair.

I guess so if driving some taxpayers to the point of starvation is fair. I'm sort of in favour of those of means paying an extra 5% just to cover the "cracks" the handicapped could fall through.

Why isn't fair for all tax payers pay their proportionate fair share we all enjoy the same amount of services, in fact the lowest income persons probably enjoy more services than the upper income persons

What tax break s are you referring to?

Very good point I'm interested in this answer as well

 

[petros]

What tax breaks are you referring to?

I want in too.

 

[captain morgan]

Don't we all... I'm still waiting on my E&P subsidy cheque... It's been years

 

[petros]

It must be the deposit on bottles and cans.

Rich people buy more 1L or larger bottles.

 

[JLM]

It's too bad that you are unable to be civil.


I suggest you take a break until you can carry on a civil conversation.

I'm not above apologizing - I just took your remark "it's called Math", to be sarcastic and demeaning. If I took it wrong I'm sorry, didn't mean to perpetuate hard feelings. Have a good day.

 

[captain morgan]

It must be the deposit on bottles and cans.

Rich people buy more 1L or larger bottles.

I'm going to search the CRA website for some money saving tips like refraining from lighting your $50 Cohiba with a $20.

It's the small things that you take for granted that can really ad up

 

[petros]

Let's say a Corp has a profit of $1,000,000. A chunk goes to the Feds, the Province and Municipality.

Call it 25% for the sake of example.

Say the Corp has 1000 shares and each share gets a dividend of $750.

That $750 in Joe Blow's hands now gets taxed again at the personal income tax rate so in reality almost half that Corporation's income went to Govt.

 

[pgs]

Let's say a Corp has a profit of $1,000,000. A chunk goes to the Feds, the Province and Municipality.

Call it 25% for the sake of example.

Say the Corp has 1000 shares and each share gets a dividend of $750.

That $750 in Joe Blow's hands now gets taxed again at the personal income tax rate so in reality almost half that Corporation's income went to Govt.

Back in my lumber remanufacturing days the government made more on a truck load of lumber then we did .

 

[petros]

I'm going to search the CRA website for some money saving tips like refraining from lighting your $50 Cohiba with a $20.

Those go nice with a glass of Bowmore.

Back in my lumber remanufacturing days the government made more on a truck load of lumber then we did .

They still do.

 

[taxslave]

I know you have no clue what the fancy C&P graphs you post mean but to me that one means that Canada is a poor place to invest. That would mean government policies, at all levels are inhibiting investment.

Do I understand that you would have earners making $5000 a year taxed at the same rate as those earning $100,000? How would that possibly work?

Just like a 35% gross income tax on business would work.

 

[Corduroy]

flat taxes infer to me that poor people pay more.

The point is the rich pay less. The poor paying more is just gravy.

 

[taxslave]

That is the important part.


Should people pay the same proportion of their income, or should there be some adjustment for the fact that basic living (food, housing, etc) costs pretty much the same whether your income is $5,000 or $150,000, and therefore some adjustment needs to be made to compensate for the idea that a large income leaves more 'discretionary' money?


I'm not arguing either way, I'm just saying, it's all in how you define 'fair'. And that's what makes it different for different people.

That is essentially the point we have been trying to make. How do you want to define fair share?

 

[petros]

The point is the rich pay less. The poor paying more is just gravy.

No they don't. Taxes are on a sliding scale. You've heard the term " the more you make the more they take" haven’t you?

2016 Federal income tax rates. $45,282 or less. 15% $45,282 to $90,563. 20.5% $90,563 to $140,388. 26% $140,388 to $200,000. 29% More than $200,000. 33% * These amounts are adjusted for inflation and other factors in each tax year.