Federal Budget 2024 megathread

[Brad Sallows]

How much of total federal income tax revenue is a "fair" share?

For the benefit of others who might be curious, a few numbers to inform discussion. Source is here. (These stats take enough time that they always seem to lag by a couple of years, so figures are 2021 tax year.)

From Table 1:
Total number of individual tax returns filed: 29,330,240.
Total number in uppermost bracket (income $216,511 or more at that time): 457,320.

Fraction of filers in uppermost bracket: 1.56 %
Important: keep in mind total returns includes people who file returns just for benefits without any taxable income.

From Table 3:
Net federal tax: $186.773 billion
Paid by filers in uppermost bracket: $55.815 billion
Fraction of net federal tax paid by filers in uppermost bracket: 29.89 %

So 1.56% of the filers (the "very rich") are paying 29.89% of the total federal individual income tax take.

Whether or not that's "fair" is a subjective call by the reader.

 

[OldSolduer]

It appears to me that jealousy of someone's wealth is the prime motivation to "tax the rich". Which in other words is Communism.

 

[CBH99]

Remember folks, we're doing better than all of the other G7 countries...

 

[QV]

Remember folks, we're doing better than all of the other G7 countries...

Better at squandering potential but that is it.

 

[Haggis]

For the benefit of others who might be curious, a few numbers to inform discussion. Source is here. (These stats take enough time that they always seem to lag by a couple of years, so figures are 2021 tax year.)

From Table 1:
Total number of individual tax returns filed: 29,330,240.
Total number in uppermost bracket (income $216,511 or more at that time): 457,320.

Fraction of filers in uppermost bracket: 1.56 %
Important: keep in mind total returns includes people who file returns just for benefits without any taxable income.

From Table 3:
Net federal tax: $186.773 billion
Paid by filers in uppermost bracket: $55.815 billion
Fraction of net federal tax paid by filers in uppermost bracket: 29.89 %

So 1.56% of the filers (the "very rich") are paying 29.89% of the total federal individual income tax take.

Whether or not that's "fair" is a subjective call by the reader.

Good bit of perspective. Thanks.

 

[Halifax Tar]

And we're off!

 

[KevinB]

For the benefit of others who might be curious, a few numbers to inform discussion. Source is here. (These stats take enough time that they always seem to lag by a couple of years, so figures are 2021 tax year.)

From Table 1:
Total number of individual tax returns filed: 29,330,240.
Total number in uppermost bracket (income $216,511 or more at that time): 457,320.

Fraction of filers in uppermost bracket: 1.56 %
Important: keep in mind total returns includes people who file returns just for benefits without any taxable income.

From Table 3:
Net federal tax: $186.773 billion
Paid by filers in uppermost bracket: $55.815 billion
Fraction of net federal tax paid by filers in uppermost bracket: 29.89 %

So 1.56% of the filers (the "very rich") are paying 29.89% of the total federal individual income tax take.

Whether or not that's "fair" is a subjective call by the reader.

Perhaps a more illuminating look would be at the incomes of the 1.56% of filers in that upper bracket, and how the payments of those work out in compared to their income levels.

 

[brihard]

Looks like the biggest tax hike will be including the capital gains inclusion rate from 1/2 to 2/3 for capital gains after the first $250k, and for corporations and trusts. TFSA, RRSP and similar investment vehicles remains exempt, and there will be no new tax on capital gains for principle residence. The impact of this tax will be limited to a small portion of the top 1% of income earners.

Inasmuch as a tax hike can be targeted exclusively at the wealthy, this fits the bill.

 

[Fishbone Jones]

People in the top bracket have very expensive accountants. They have charities, endowments and philanthropy. They have huge operating and business expenses. The government doesn't get as much out of them as people think or expect.

That is wholly, 100% of the governments fault. They make the rules. Millionaires exploit those rules.

Like Trump saying he pays no tax. It's not cheating. It's being a savvy businessman, using the existing law, made by politicians, to his advantage.

Just like the rest of us do when we submit charity receipts.

 

[Fishbone Jones]

 

[Brad Sallows]

The impact of this tax will be limited to a small portion of the top 1% of income earners.

It can't be, unless there's an "AND" condition tying the rate to other reported income or absolutely no-one with an income below the top 1% ever tries to unload an asset with a gain in the target range. If you're just a poor schmuck with an ordinary income who wants to unload a sizeable asset that has appreciated for years, you pay, too.

 

[brihard]

It can't be, unless there's an "AND" condition tying the rate to other reported income or absolutely no-one with an income below the top 1% ever tries to unload an asset with a gain in the target range. If you're just a poor schmuck with an ordinary income who wants to unload a sizeable asset that has appreciated for years, you pay, too.

Someone who is offloading enough of an asset at once to realize more than a quarter million dollars in capital gains may be ordinary, but they’re not a ‘poor schmuck’. A capital gains inclusion rate of 2/3 above that first quarter mil is not going to cause hardship.

The most realistic example is someone who owns a non-principal-residence property that has appreciated considerably and who sells. That’s going to be at the bottom end of the wealth intended to be subject to this tax, but it seems to be within the policy intent. The difference would be an additional 16% capital gains inclusion at one’s marginal rate for the gains above $250k. That won’t be hard for the government to sell to most voters who will never be in that fortunate position.

For those relatively rare cases we’ll quickly see various workarounds develop where people will move in to a property for a year before selling, or something like that. The real impact will be felt by those with substantial investment portfolios beyond a single additional residence.

 

[Remius]

https://www.cbc.ca/news/canada/ottawa/federal-budget-shrinks-public-service-by-5-000-over-4-years-1.7175515

Not exactly massive.

 

[Brad Sallows]

Someone who is offloading enough of an asset at once to realize more than a quarter million dollars in capital gains may be ordinary, but they’re not a ‘poor schmuck’. A capital gains inclusion rate of 2/3 above that first quarter mil is not going to cause hardship.

Right, but it still means the impact isn't limited to the top 1% of income earners. If that's the target, a condition restricting the tax to those people is required.

 

[suffolkowner]

https://www.cbc.ca/news/canada/ottawa/federal-budget-shrinks-public-service-by-5-000-over-4-years-1.7175515

Not exactly massive.

no but attrition is a good solution. The building divestments and land towards housing is promising as is the same for the CAF. Amazing what they can do when they are scared of losing power

 

[Brad Sallows]

The real impact will be felt by those with substantial investment portfolios beyond a single additional residence.

It's not going to be felt by anyone who can wait until the next parliament rolls the inclusion rate back to 50%.

 

[Quirky]

Chapter 7: Protecting Canadians and Defending Democracy | Budget 2024

Description here

budget.canada.ca

Stronger National Defence - Building Homes for Canadian Armed Forces Personnel - $0

 

[Fishbone Jones]

https://www.cbc.ca/news/canada/ottawa/federal-budget-shrinks-public-service-by-5-000-over-4-years-1.7175515

Not exactly massive.

The red and orange liberals will hire them back as outside consultants

 

[brihard]

It's not going to be felt by anyone who can wait until the next parliament rolls the inclusion rate back to 50%.

Providing it’s politically palatable for them to be seen to do so. You want to talk about boutique tax cuts for the rich? A rollback on capital gains past the first quarter million is exactly how you piss of more normal voters.

 

[TacticalTea]

The richest are already insulated from the majority of potential new tax measures. They should pay a fair share; tax the rich. You think the Irvings/Loblaws/etc.. are gonna pack up and move somewhere else with more competition vs staying home where they've already eliminated most of their competition? And if they did to avoid taxes then good - lets Naval Group the **** out of their yards and own stake in it with the Koreans.

This budget is a start in the right direction but its too late to undo the poll numbers. Maybe if Justin anounced his retirement and named Freeland the interim leader it may redirect the narrative from the Justin hate to whose got the best idea to build homes and improve CoL.

Is this a joke