One of Michael James’ favorite groups is Motorhead (hard to believe), and he especially enjoys their song called Eat the Rich. Given the latest discussions I am seeing about how Wealthy Canadians should pay more tax puts me in mind of that song. Why just tax the rich, let’s just eat them and be done with having to worry about them? Eat the Rich?
I am being facetious, but for Canadians to complain that anyone is not paying enough taxes is quite amusing. In the U.S. Wealthy Americans really don’t pay a lot of tax, but most Americans (compared to a Canadian with similar income) pay less taxes as well. As Canadians we are already highly taxed (and may be taxed further very soon), so increasing the taxes on the top 1% of Canadians seems a little excessive to me.
As was mentioned in TFSA limits don’t rise again the marginal tax rate for Canadians in the highest tax bracket is 29% (only on the Federal, then you have Provincial tax on top of that) and that rate kicks in at an income of $132,406 for 2012. The rate on money earned above this (in Ontario at least) is around 43%, which is pretty darn high (in my estimation), not sure how folks can argue this rate should somehow be higher.
Many people I hear espousing this increased tax loads on wealthy Canadians seem to think they should be able to tax folks across the board. However, a lot of the folks who are deemed “wealthy” have only large retirement savings and are not that well off right now. If you look at me as a Civil Servant with the current pension system, I can be construed in some ways as being wealthy, when in fact, I don’t have any of this wealth available to me (until I retire), but I hear folks spewing bile about how I am a rich civil servant because of my pension. I can assure you, I do not feel that wealthy right now, even with my “gold-plated federal pension” (to quote a few of the media wags out there).
The answer is not taxing folks into a financial black hole. The better answer is to get the economy working well. That way, the Government can keep income levels up from all those happy working Canadians paying tax and such, not try to get the Westin Family to pay higher taxes on their Millions (or is it Billions now?).
“There is no such thing as a good tax” Winston Churchill
The 43% marginal tax rate in Ontario kicks in at about $85,000, above $132,000 it is 46%. Got to get the money to pay those civil servant salaries from somewhere :).