Renegade

Exactly what question are you answering? Either you are having trouble understanding what I am asking our I am have trouble communicating. I DIDN'T ask if it is better to take a business trip as an employee or self-employed. What I asked is OVERALL from a TAX-Perspective all things being equal, (assume the individual's behavior, clients, employment time, and acceptance of risk is all equal), is it better from a TAX PERSPECTIVE to be self-employeed. I'm not sure I can phrase it clearer than that.

I'm not sure either. But we do enforce financial obligations in other areas such as child support, so it would be great to see a simiar system in place. As well by having an outstanding obligation to the victim, it would make it more difficult for the victim to accumulate assets as they could be siezed for repayment of the financial obligation. This is similar to the situation OJ finds himself in. Of course, I agree, that many times the obligation will be uncollectable, but at least having an outstanding obligation in place allows justification for asset and income seizure when it is collectable.

What I'm saying is that the sentence is not sufficient to clear his "debt to society". IMV, there should four general components to a punishment for an offender: Retribution, Rehabilitation, Restitution and Deterance. The sentence could possibly address the "Retribution" and "Deterance", and depending upon what happens during his sentence, "Rehabilitation", but it doesn't address "Restitution". IMV, the "you broke it, you pay for it principle" applies. In this case the offender and co-offenders pretty much wrecked the victim's life. They should be liable for the cost to the greatest extent it is collectable.

What does "directly related to earning income" mean? With an individual many expenses have a mixed business/personal purpose, however the business purpose is completely disregarded when it comes to deductions, however with business when a expense is of mixed purposed the business is allowed to partially deduct that expense. With individuals virtually all expenses are interpreted to have a personal component and are disallowed. It only makes sense because it simplifes tax collection and enforcement. It doesn't make for equity that the principle of expenses to earn income are unequally applied. Yes, if one of the goals is simplification then I agree that allowing individuals to deduct addiotional expenses simply makes things more complicated (similar to the complexity self-employed face). One solution, as I proposed, is to simply tax revenue. This both simplifies and puts both individuals and business on the same playing field. Simplify, Simplify, Simplify It is a presumption that the expenses are to earn income. When a business takes staff out for a lunch, the only real impact is to staff morale rather than to income. Sure it may or may not have in impact on revenue. Can an employee treat him self to a lunch to increase his morale and expect that he can deduct those expenses, afterall his morale and attitude will have a bearing on his overall compensation? What about an employee who purchases a set of suits because his job role requires it? He would not have not purchased that set of suits except because it is the requirement of the job, and it is directly to earn income. Oh yeah, the suits are "personal" right, despite the fact that he may never wear those suits outside a work context. An employee has no control of what expenses a business will allow reimbursement for and what they won't. This is usually dictated in the expense policy. Clothing is one example of this. Many professions require attire which is suitable for work but is not reimbursable. You can't just show up with whatever you have in the drawer and expect to keep your job for long. Assuming revenue neutrality, you assume that simply the tax rates on individuals would rise but not business. My belief is that the overall tax-rate for both business and individuals would rise, and we would see a shift of the burden onto business from individuals. Exactly what I've been saying all along msj. It is driven by political appetite, not any underlying principle, or notion of "fairness". Your comment that "Can't say I really care one way or the other" illustrates why I don't expect any immediate change. You, the government, and others simply don't care that there is inequity in the system. The motivation is who shouts the loudest and who can generate the most political might. I know nothing about your business trip so I can't say one way or another, but you would be honest to acknowledge that part of the expertise you and other tax professionals provide is to understand the limits and how to stay within them in general. Many of these limits are guidance and is subject to interpretation. I have see many situations in which tax professionals will be agressive in their interpretation and would be consistent with the term "stretching the limits". When the limits are rigid as they are with individuals, there is no opportunity to test the interpretation by "stretching the limits" I agree. I didn't say it was a solution to that. Personally I would favour a user-pay model for services, combined with a consumption tax, combined with a flat-tax no-deduction income tax for both business and individuals/ Of course they do, that is why people like you are employed. Government is not anxious to extend those dedctions and complexity to individuals. Regardless, it leads to an inequity between individual and business tax systems. So what? are we discussing the inequity or the propensity to change? I didnt' say he got the job. I said he looks for employment. In business if you drill for oil but don't find it, do you still get to claim the drilling expense. To simplify the situation and remove the cross-border issues, lets say it wasn't Italy, but say it was a trip to Vancouver. The employee flew there, saw the sights, and while he was there applied for a job which he didn't get. Should a portion of his trip be tax deductable? Not at all. So what if some business are low-margin businesses. They will simply pass on that cost to their customers or if they couldn't they would go out of business. The system as is allows business which show no or very little income to avoid paying taxes yet consume services that are paid for by taxes of other businesses and individuals. No I couldn't care less about business people still deducting business expenses. I do care about inconsistency between individuals and businesses. Sure I am, but I also have businesses on the side, so I do take as full advantage as I'm allowed of the system. If given the choice I would take all my income as self-employment income. How about you answer the question directly. I asked from a TAX PERSPECTIVE. You assume that employees wouldn't spend the "extra unpaid time for networking and office time" or take on additional risk. Many employees earnings are related to the business performance. So, when I say all things being equal, I mean assume the individual's behavior, clients, employment time, and acceptance of risk is all equal. Is it better from a TAX PERSPECTIVE to be self-employeed. If you don't see that it is, I wouldn't want you as my tax accountant. Sorry msj, but your example is completely irrelevant to anything we are discussing. Whether an employee waste time at work is a function of how he is incented and his personal character. If you point is that both employees and self-employeed can cheat, of course, that was never in dispute but is completey irrelevant to the tax code.

Yes I believe that people shouldn't have kids they can't pay for. I am not arguing that $250K income couple "need" a full deduction, or my personal view of the deduction, I am simply explaining the tax-code reasoning behind it, as you asked for an explaination. I'm not defending it, if I had my way, I would eliminate that and other deductions completely. IMV, No, they should do whatever made sense to them, they should simply not expect the taxpayer to subsidize it.

I meant after he is released.

A very relevant case to this was reported in The Star today: Court allows unjust searches

It is not enough. He should be made to provide restitution to his victim for the ongoing costs and suffering the victim will bear through out life.

Yes it is. It is a noble and generous act, and I believe many people would share thesentiment you express. However, for those who do not share that altruism, I don't think it warrants criminal penalties.

Certainly people who earn sufficient over and above those expenses will continue to work regardless, mostly because they have no choice. In other situations where work-related expenses consume too much of income and are not tax-deductbale, the potential employee will simply (and logically) choose to collect social benefits where those are available. None of this speaks favourably for the equity of deductions between businesses and individuals. Pat, daycare expenses are one of the few deductions offered to individuals which bear some similarity to the many offered businesses. The govenment makes "interpretive" decisions on what are allowed deductions. If a nanny looks after a child but also cooks and cleans, then at least part of her role is personal and part used to generate income. If you accept the logic that deductions used to generate income should be tax-deductable, then it is irrelevant if it the family with the $250,000 income which is using the deduction or it is a family with $60,000. The simple test is whether the expense is a necessary expense in order to generate income. In the case of a 2 income family, it is deemed necessary. In the case of a single income family, it is not because the other spouse is available to provide childcare. The size of the income is not relevant.

Thanks! Hopefully my points made sense to msj. I believe "fairness" is used as a politically-correct justification for all kinds of tax-related initiatives, however the real motivitaion is far different than "fairness". Generally taxes are implementd because they are easily collectable using the existing collection infrastructure, will minimially affect the economy don't erode much poltical support. For the government the less visible the tax is the better. That is why the GST, a highly-visible tax, while conceptually a sound tax, was a political failure and led to the eroding Mulroney's political base. For some of the same reasons, the Conservatives introduce tax incentives which are primarily politically motivated. "Fairness" has very little to do with it, and while many governents use the word, few will provide the specifics on defining the term. This is perhaps the most distressing part. People who are being disadvantaged by the tax system, are in general unaware of it. Very few do tax planning and most don't even do their taxes themselves. Many take a simplistic view that what they owe once their tax return is done is their tax bill, without considering the much more deducted at source. At source deductions mask the amount of tax being paid by grabbing it before an employee even sees it. I suspect that if at source deductions were not in place and people had to cough-up directly once or more times a year, they would realize the extent of their tax bill and agitate for change.

Your own response illustrates the inequity. You yourself have referred to the principle that expenses incurred to generate income should be deductible. In the case of indiviuals, many of those expenses are deemed "personal" and disallowed even when they have at least a partial valid business purpose in generating income. With businesses many of those deductions are allowed (yes, I understand subject to limitations and interpretation), but that is a far cry from not being allowed at all. To sum it up, with individuals the expenses are presumed personal and disallowed, with self-employed and businesses the expenses are presumed to generate income and allowed (subject to audit and interpretation). Of course it is far "easier, practically speaking, to disallow the deduction", but is that the criteria you think the government should use in determining whether deductions are allowed to one group but not another. I suggest the reason these deductions are not allowed is not related at all to tax "fairness" but because substantial revenue is at stake which the governmet cannot afford to lose, so it lets the inequity perpetuate. That's exactly the point. Not enough people are aware of the detail of the tax code to know how it impacts them. That individuals are getting screwed and don't know it, doesn't mean the screwing isn't happening. Again you illustrate the point. Business generally have the scale to employ expertise to be knowledgable on how far the tax rules can be stretched. The complexity of the law means that it is not cost effective for individuals to employ the same expertse. Because there are so many deductions available to business which are not availble to individuals the tax laws which can be "stretched" are far greater. Since such a trip is clearly mixed business/pleasure, how is it that an employee who takes a trip to Italy and looks for potential employment cannot deduct part of the cost of his trip? Personally I don't care if you tax on revenue or you tax on profit, I'm just saying it should be uniform for both business and individuals. The fact that businesses have different gross and net margins is irrelevant. If they can't afford t pass on the cost they go out of business. Simple. Not really. I have personal experience having been both self-employed and an employee. There are clear tax benefits to being self-employeed. Let me ask you as a tax-accountant, if someone came to you and they were in a position where they could choose whether they would be self-employed or an employee, all oher things being equal, from a TAX-PERSPECTIVE only, which would you advise? All true but irrelevant. We are not disputing the overhead and the real PIA it can be to be self-employed or a business, we are discussing the advantage in the tax system given to business and self-employed. Are you somehow suggesting that the tax advantage is in compensation for it being a PIA to be a business? So have I. But so what? I have also seen many people who have tried to be employees and fail. CEOs. CFOs and other executives who are employees suffer the same restrictions as other employees. Generally they have enough clout to negotiate compensation in other tax-advantaged ways (such as stock options and benefits). I don't think you are personally screwing the system because the system is geared to favour you and other self-employed. It is the system that is screwing employees.

There are a wide variety of expenses which are incurred to earn income some are deductable and some are not. Even some of which are deductable are limited. For example: 1. If I need to pay for transportation in order to get to the workplace why are those costs not deductable because surely if I didn't incur those cost I couldn't earn the income. 2. Most workplaces have a dress code which I must adhere to. Should not my workplace clothing be deductable? 3. Are my food and shelter expenses not necessary to sustain myself in order to earn a living? If you don't think so, how is it that a business can claim those expenses as deductions when it sends an employee on a business trip. 4. Childcare expenses are limited. If I worked additional hours and thus needed additional childcare, why should those be limited? I could go on, but you get the idea. There are huge tax advantages to being self-employed. Ask any accountant. When a business has an executive meeting at an exotic locale, they still write off those expenses even though the same business purpose could have been accomplished in a far more mundane and inexpensive locale. If you think that there are not signifcantly more opportunities to avail onself of tax deductions if you are a business or self-employed you are acting naive. Every employee if given the opportunity would be self-employed because of the tax advantages, which is why the government sets rules on who can be considered self-employed.

This is simplistic at best. Many deductions depend upon the kind of income you generate (for example investment expenses are deductable against investment income). Some deductions are only available to those who are qualified. In addition, for low incomes say $10,000, even the basic exemption shelters virtually all of that income. Here I agree with you. Business income is taxed on profit yet personal income is taxed based upon revenue. This difference allows business and self-employed to shelter much of their income. IMV they should be taxed on revenue or that same consideration to deduct expenses should be given to indivduals. All of your examples were of business discrepancies, but suddenly you slipped "rich" in the mix. Are you assuming that all rich are self-employed. Are you assuming all self-employed are rich? What of the rich who have earned their riches through employment income? So given what you have said, I ask again, would you support a flat tax without any deductions? Also since you want uniform rules to apply to business and individuals, would you want individuals to incur the same other obligations as with business?

Oleg, you can save many who abort because they don't have financial support to adequately bring up a child. Since you feel so strongly that "white" babies need to be saved to preserve white genetic stock, you can offer to undertake the full financial support for these children. So, how many have you made the offer to, and how many do you now support?

So the unborn fetus were the "nations best" and the immigrants are "the worst and most inferiour", that's what you are saying right? Tell me how do you know? Obviously the unborn never proved that they were the "nations best" because they didn't have a chance. Many of them would have been born to unwed mothers and been brought up in single-parent homes and had a stuggle during life. How do you know how they would have turned out?

Why? Families in general already get the some of the largest support at the cost to everyone else. If your goal is to stop childhood poverty, the most effective way of doing so is to prevent people in poverty from having children. I think that we can agree that it woud be irresponsible for someone to get a pet they couldn't afford to feed or care for. If we would give such consideration to pets, why wouldn't we give it to kids? BTW, IMV money is not the only consideraion for someone to be a "qualified" parent. Mental health, emotional stability, and a willingness to undertake the responsibilites of parenthood are among the other necessary qualiites for someone to be consider a responsile parent. Which poverty line are you refering to? If you mean "Low-Income Cut-Off", that is a relative measuremnt IOW, it doesn't measure people being"poor" it measures people being poorer than the rest of the population. Such a measurement or the purposes of wealth redistribution is nonsense. You say "it must be done.". Why? There is a much better way for the poorer to become richer without wealth redistribution: Work harder, longer, or at a more lucrative profession. I can tell you that there are many trades which suffer from a lack of labour. Jerry, you have a very narrow view of what can be done. Certainly corporate welfare and loopholes can be eliminated, but those are a function of our disfunctional tax system. The more complex a system, and the more deuctions allowed, the more loopholes will exist Nothing short of a complete overhaul will be needed. Virtually all deductions, exemptions and credits for EVERYONE should be eliminated. Since you believe that the rich escape taxes through the use of loopholes, you should be a proponent of a flat tax, because it will be harder for people to use loopholes to avoid taxes. Hmm, you seem to advocate that they only act for the best interest of a subset of citizens (ie those with families and low income).

Yes I agree, as I said before, there should be consistancy between how income is guaged when benefits are caclulated and when taxes are assessed. If that means your wife applies for benefits based upon soley her income. Fine, I'm ok to agree to that. However I beleive that when you accept benefits from the state, you are also accepting a level of state itervention in your life. I believe it is perfectly reasonable for the state to impose restrictions on people with children the could not otherwise afford, to prevent them from having more children. If you are comfortable with state benefits, you should also be willng to accept state intervention. There is something else you need to consider. If you want to consider that benefits are calculated the same way as for two separate parents, in the case of separate benefits the non-custodial parent is expected to provide child-support payments to the custodial parent. The payments are neither deductable by the payor nor considered income for income tax purposes by the recepient, however, support payments are factored in for welfare payments. Further, I believe assets are also considered for the purposes of welfare and benefits payments. If you wife is considere to own 50% of the family assets, some of those assets may need to be sold to qualify for welfare payments. Yes there needs to be a way to stop undesirable behavior. People having kids they can't afford to bring up is undesirable behaviour. As far as benefits are concerned, personally I'd minimize them to everyone, working and "bums". With the tax savings, the working can buy their own "benefits".

Right now the favouritism is only restricted to pesioners and only those who have a significantly uneven distribution of income. Why would single people want to support that inequiity to the rest of the revenue base. If you look at incrementally, the basic cost of living for a single does not hugely increase once that single becomes a couple. They achieve efficiencies of scale. Usually their is no or little additional housing cost, some incremental food and clothing costs but nowhere near 75% addiitional of the cost a single person incurs, so why would a single person support a tax bracket or deduction which is 200% as wide or even 175% as wide? Very few, mostly because they don't have to. If they had to they would likely have have to give up that 3 bedroom house in the suburbs, and the SUV and vacations. Gasp, they might even have to decide to only have one kid because that is all they can afford. In essence they would be forced to make the necessary tradeoff between lifestyle and their desire to have kids. In addition, if they were truly paying their own cost for school, food, medical bills, etc, their overally tax burden would be significantly lower so they would have greater available income to pay for those costs. We already do, it is simply done by stealth. For example long wait times in medical care is a way of rationing medical service and imposing a limit. It is just not explicitly called out. IMV it would be more honest to simply impose limits on what was spent. I suppose we can focus our efforts on how to prevent them, or disincent them from having kids. I'm not sure how heavy-handed or coercive the state would need to be to enforce this. IMV it is an injustice done to the child for a parent who is incapable of supporting their child to have one. A good question is would we want to use criminal law to enforce this? Would we want to go so far as to sterilize an individual who was having kids they couldn't support to prevent them from having more?

Why ask me? Isn't that a question they should have been asking themselves through out their working lives?

I wasn't talking about your 2 tax rate, dependant-exemption proposal. I was talking about your proposal that income-splitting for employment income be added to the existing tax structure. It is not just childless couples support is needed from. Any taxpayer who does not have kids (such as singles), in addition to childless couples, if they looked at the implications would simply a further shift of the tax burden onto themselves, from a part of the population which is already receiving substantial support. I'd like to understand where you get these numbers (ie the 5%) and what this specificly means. Does that mean that only 5% can afford basic feeding, clothing, medical, and shelter or does it mean that what they "need" to pay for is a large house in the suburbs, one or more cars, and assorted recreation? Somewhat what a person can afford, is a matter of standard of living they expect to live. If they lower their expectation on the standard of living, they can afford more. Really it is the unwillingness of many to accept that they should lower their expectations combined with ignorance on the true cost of having a kid, which causes many to lobby for state aid for services which they themselves should be financially responsible for. The minority which are getting screwed and know it, should expect that any proposed changes to the tax system should not further shift the tax burden on to them and they should not support any that do. Alas I think the tax system is so complicated that most are getting screwed and don't even know it, so the simple test for whether they support a tax change lies with the answer to the question "What's in it for me?"

You will not get unanimity of opinion over this. Clearly those who have kids will have an incentive to have a self-serving opinion and if they have the numbers they can force others to support their kids. While it may be democracy it isn't necessarily "fair". Then they should be having those kids the can't pay for. IMO the solution is not to provide more incentives to have kids they can't afford. If that means they have more kids, so be it. So what the hell exactly are they getting for their taxes? Why would they be inclined to support your proposal which primarily benefits the married many of whom have kids?

The accused is alledged to have coerced people into having their body organs removed. Yes that should be legislated against because that is the equivalent to extortion and robbery. Let's assume that as he claims, the donations were all voluntary. If the practice was not illegal, there woudl be a competitive environment for donated organs, thereby raising the price offered. It is because it is illegal, that the accused can reap high profits, and the donator has little choice of who will buy their organs.

Yes, I do believe that people should pay the true cost of the services they consume including medical services. My point is that it is a separate issue than incentive for organ donation and incentive for organ donation can exist even within the context of socalized medicine.

I use stunt performer as an example. I could use coal miner, deep-sea fishremen, or other dangerous jobs. And yes, some people will do those jobs because they are desperate and destitute because there are no other jobs they can do and someone needs to do them. Furthermore you generalize people's motivations on why they do or don't take the jobs. How do you know universally what people's motivations are, care to provide any evidence? No that is not what I said. Who get the organs really depends upon the medical system in place. In a private medical system the person undergoing the procedure (or his insurance) would be responsible for payig the cost. In a single government-pay system, the govrenment would be responsible for paying the cost by coming to agreement with a compatible donor. Just because the donor is paid doesn't mean the only one getting the organs are those who are able to pay. My point was that the price doesn't need to be set artifically. See my answer above. So you think that because organ donation is unpaid, 50year old alcoholics won't donate their liver? Even within the donation community, not all organs are equal. Some are in better shape than others. How do they determine who gets the better organs today? Surely you are not contending that smply because donation is unpaid, that somehow as a result all donated organs are of equal quality. And, those poor people you claim will be the only ones giving up there organs in an incentive scheme arent the same "calibre" as those who donate without pay? In any case, so what? People who are receipents understand that there are risks with transplanted organs. With the unpaid donation, a lucky few get the organs, and other die waiting. Ask the ones who die if they would be ok accepting "lower calibre" organs. If by our countries you include Canada. then yes I am talking about our countries. So what if they need to do additional screening? No it is not "them" we allow. We allow ourselves that choice. That includes "them", and yes it is decent to do so, and should be our fundemental right. So if the less well off are percieved to end up being "taken advantage of" by serving in the military, why is it they don't ban anyone serving in the military for pay. Surely that would solve the problem right? We can go to an all volunteer unpaid army, and surely that will result in better calibre soldiers, and won't result in the poor being "taken advantage of", afterall it works for organ donation, right? Who would the backlash be from? The donors who are now not permitted to get compensated, or the people who don't donate but yet think they have the right to interfere in people's right to choose. Yes, the 80's. In Canada in the 80s and still today the blood was not paid for, yet contamination happened. Are you somehow suggesting that the testing can be more lax because the organ donation is voluntary? -------------------------- AW, you don't adress a key issue you brough up. If "My body, my choice" isn't 100%, who decides to what extent it applies? Is it left to legislator's whim?