Are the Liberals really going to Tax Workplace Benefits?

[Boges]

The National Post seems to think this is something the Liberals are actually thinking about. 

http://news.nationalpost.com/full-comment/andrew-coyne-if-fairness-is-the-goal-liberals-should-tax-health-and-dental-plans

Quote

 

No one’s confirming anything, but that no one is denying it is significant in itself. The move, which economists have been urging for years, is nevertheless the kind that would usually be dismissed in political circles as “courageous,” in the Yes, Minister sense.

It would, after all, tax as income a benefit that millions of Canadians are used to receiving tax-free — a break worth $2.9 billion in all — and as such would be subject to the same braying objection as the carbon tax: it’s a tax, all taxes are bad, therefore this is bad. You can already see the opposition critics warming up their larynges.

But as important as the size of government is its shape. It’s valid to insist that, before governments seek to raise more revenues from the taxpayer, they should first give evidence that existing revenues are well spent: new spending is best financed out of old.

 

Is this a case of, if there is smoke there's fire? It would be a boon to the government but it would be a huge tax grab on something people are used to getting tax free as a perk of employment. 

It would directly effecting the middle-class people that JT pretends to give a crap about. 

Do you guys think it would be political suicide or is it just fair as bennies are income? 

[Smallc]

I think the issue is one of fairness.  I, for the first time in my life, have health benefits, but I'm completely in favour of leveling the playing field here.  

[Boges]

1 minute ago, Smallc said:

I think the issue is one of fairness.  I, for the first time in my life, have health benefits, but I'm completely in favour of leveling the playing field here.  

Fairness to whom? People who don't have workplace benefits? 

Edited January 30, 2017 by Boges

[Smallc]

Just now, Boges said:

Fairness to whom? People who don't have workplace benefits? 

Yes.  Also, people who have other workplace benefits, such as life insurance, which are taxed.

[Boges]

It doesn't make it fair to people who don't have those services. Fairness would be having the government cover services like dental, pharmacare and eye glasses. 

This is just a tax grab. And it looks like it would be a huge burden ($1,000 a year or so added to people's T4). 

This would be political suicide. 

[Smallc]

6 minutes ago, Boges said:

It doesn't make it fair to people who don't have those services.

Sure it does - right now, those extra benefits are tax free. 

[Boges]

1 minute ago, Smallc said:

Sure it does - right now, those extra benefits are tax free. 

We gonna tax groceries too? 

Sure the argument can be made that it's income and should be taxed. But it's political suicide and completely contradictory to pretending you give a crap about the middle class. 

Edited January 30, 2017 by Boges

[eyeball]

My employer has said this could cause them to cancel our benefits due to the increase in their payroll taxes.

If this is the case then I think these benefits should be universal and covered by our provincial medical plan.

[Smallc]

6 minutes ago, Boges said:

We gonna tax groceries too? 

Sure the argument can be made that it's income and should be taxed. But it's political suicide and completely contradictory to pretending you give a crap about the middle class. 

It's early in the mandate - now is the time to do it.

[Smallc]

3 minutes ago, eyeball said:

My employer has said this could cause them to cancel our benefits due to the increase in their payroll taxes.

Nice excuse on their part, eh?

[Boges]

1 minute ago, Smallc said:

It's early in the mandate - now is the time to do it.

Conveniently doing it after his tour to outreach to average Canadians. Didn't want to field questions about a tax grab on people getting medications and trips to the dentist. 

[blueblood]

3 minutes ago, Boges said:

Conveniently doing it after his tour to outreach to average Canadians. Didn't want to field questions about a tax grab on people getting medications and trips to the dentist. 

 I Can just see O'Leary having another plank to beat Trudeau over the head with...

[Ash74]

Of course benefits will be taxed. Only the rich have benefits just like only the rich benefited from the income split deduction. 

I did not even know I was rich till I saw those commercials.  

[Argus]

3 hours ago, Smallc said:

Sure it does - right now, those extra benefits are tax free. 

All seniors in Ontario get free prescription drugs. Should they be taxed on that?

[Argus]

3 hours ago, blueblood said:

 I Can just see O'Leary having another plank to beat Trudeau over the head with...

There are only two ways to get out of the mess Trudeau and the Liberals are in. Either you cancel a bunch of the expensive programs you just implemented (not the Liberal thing) or you raise taxes, hopefully in a whole bunch of little ways that will still let you claim you didn't raise taxes. The Ontario Liberals, whose people are running the Federal Liberals, have become masters at that.

[Smallc]

2 minutes ago, Argus said:

All seniors in Ontario get free prescription drugs. Should they be taxed on that?

Maybe 

[Smallc]

Just now, Argus said:

There are only two ways to get out of the mess Trudeau and the Liberals are in.

That's assuming, in contradiction to the opinions of....everyone...who knows what they're talking about, that Ottawa is in a 'mess'.

[Argus]

Just now, Smallc said:

That's assuming, in contradiction to the opinions of....everyone...who knows what they're talking about, that Ottawa is in a 'mess'.

The budget, in the opinions of everyone who can count, is a mess. That includes Ottawa, which says they'll be running deficits until your Trudeau is a senior citizen.

[Smallc]

1 minute ago, Argus said:

The budget, in the opinions of everyone who can count, is a mess. That includes Ottawa, which says they'll be running deficits until your Trudeau is a senior citizen.

Deficits (as if anyone can actually project that far anyway - but I'll humour you) that would see Canada's comfortable debt to GDP position virtually unchanged.

[blueblood]

2 minutes ago, Smallc said:

Deficits (as if anyone can actually project that far anyway - but I'll humour you) that would see Canada's comfortable debt to GDP position virtually unchanged.

Why not lower it?  Taxes are going up with trudeaus nonsense when they were lower than before.  Why have deficits if they are unneeded?

[Smallc]

Just now, blueblood said:

Why not lower it?  Taxes are going up with trudeaus nonsense when they were lower than before.  Why have deficits if they are unneeded?

Because we need to spend money on infrastructure.

Because the best way to stimulate the economy is to get money into the hands of people that will use it (Canada Child Benefit and EI changes)

Because we're going to need bigger deficits to pay for a larger military.  

Taxes, BTW, have not gone up under the Liberals as of right now.  You simply had an exchange of the UCCB and the income splitting program for the CCB and the lower middle tax rate.

[blueblood]

25 minutes ago, Smallc said:

Because we need to spend money on infrastructure.

Which private companies are trying to do.  Notice how much of a pain in the ass it is to get a pipeline through?  Building a mine?  Where is the infrastructure construction?

25 minutes ago, Smallc said:

Because the best way to stimulate the economy is to get money into the hands of people that will use it (Canada Child Benefit and EI changes)

Tax breaks keep money in the hands of people that will use it.  Child benefit and ei changes are unnecessary.  How do taxing some people at over 50% stimulate anything?

25 minutes ago, Smallc said:

Because we're going to need bigger deficits to pay for a larger military.  

Or spending and regulations can be cut.

25 minutes ago, Smallc said:

Taxes, BTW, have not gone up under the Liberals as of right now.  You simply had an exchange of the UCCB and the income splitting program for the CCB and the lower middle tax rate.

They have gone down slightly under the Tories and all leadership candidates have plans on lowering them.  The taxes will have to go down to now compete with the USA for industry.

[Smallc]

3 minutes ago, blueblood said:

Which private companies are trying to do.  Notice how much of a pain in the ass it is to get a pipeline through?  Building a mine?  Where is the infrastructure construction?

Governments need to fix crumbling highways, bridges, waterworks, buildings, and treatment systems.  This government has also approved many private projects.

 

4 minutes ago, blueblood said:

Tax breaks keep money in the hands of people that will use it.  Child benefit and ei changes are unnecessary.  How do taxing some people at over 50% stimulate anything?

It's been proven that money in the hands of the less well off will be spent, benefiting the economy.  If you feel that EI shouldn't be there to help carry Alberta through it's transition, I guess that's up to you.

6 minutes ago, blueblood said:

Or spending and regulations can be cut.

That's a nice soundbite, but its often far more difficult.  We've seen the results of spending cuts - a system in which veterans can't even get their benefit cheques because of a backlog in cases.

7 minutes ago, blueblood said:

They have gone down slightly under the Tories and all leadership candidates have plans on lowering them.  The taxes will have to go down to now compete with the USA for industry.

Personal taxes have little to do with industry.  Business taxes here are far more competitive than in the US.

[TimG]

4 hours ago, Boges said:

Do you guys think it would be political suicide or is it just fair as bennies are income? 

The public service unions would be the worst hit by such an attack so there are only two possibilities:

1) The Libs decide to pass on this tax;

2) The Libs increase public servant wages to compensate for the tax while everyone in the private sector get screwed;

If they pick 2) we need to dispense with the notion that this is about fairness. It a pointless tax grab driven by ideolgy that will not net much revenue because of cost of buying off the public servant unions.

Edited January 30, 2017 by TimG

[Boges]

So this thread has morphed into a debate as to why a tax hike is needed? 

BTW the Liberals are saying that this wouldn't really a tax hike, which is straight up laughable. 

It'll be interesting how they implement it. Is it on the bennies you actually use or how much your company chips in total? I don't get 100% benefits so I can money deducted from my pay, would they tax the other half my company chips in or will every time I use my benefits, will it be taxed? If it's the latter, you can see people debating whether their plan is worthwhile or not. 

It's sleazy that JT and Co never mentioned this in the election campaign, but again they were mum on Carbon pricing too.