Garth Turner wants to see full income-splitting

[Charles Anthony]

Can you not just accept the fact that Finance's definition of a family mirrors the financial obligations that I explained exist between spouses and dependent children?

Personally, I understand that definition but I do not think it is right.

Can you not just accept the fact that some people might want the taxation laws to change?

[Pat Coghlan]

Can you not just accept the fact that Finance's definition of a family mirrors the financial obligations that I explained exist between spouses and dependent children?

Personally, I understand that definition but I do not think it is right.

Can you not just accept the fact that some people might want the taxation laws to change?

Yes, but I'm waiting to see the basis for such a change. I've pointed out the financial liability that a person has towards his/her spouse and dependent children, and that this is why only spouses should be able to split income.

On what basis should two siblings or an adult child and his/her parent split their income for tax/benefit purposes? They can move out tomorrow, with zero liability.

I'm saying that unless such a liability exists (i.e. as with the definition used by Finance/CRA) there is really no basis or precedent.

[Renegade]

Can you not just accept the fact that Finance's definition of a family mirrors the financial obligations that I explained exist between spouses and dependent children?

I accept that is the current definition. Any definiton is subject to change. It has been changed before as the Finance Dept has come to accept societal norms (eg same-sex spouses). Typically the government definitions have been behind society's ever-changing structure

Way back, you started arguing that perhaps co-habitating siblings etc. should be treated as a family for tax/benefit purposes, but at the end of the day CRA recognizes spouses and their dependent children as a "family". There is no other definition. You don't agree with it perhaps, but you at least recognize this as the definition, don't you???

Yes I recognize that they define it that way. OK, but is your point really for me to agree how some government organization defines "family"? You have yourself stated that the govenment pick and chooses to suit its own benefit. I see its definition of "family" as simply another example of a policy designed to pick and choose who will benefit and who will not.

While there are some deductions for relatives being cared for, they don't factor into family income whatsoever, nor will you find any Dept of Finance or CRA document describing such relatives as being part of a family.

Again, yes I agree that the government defines family in a narrow and restrictive way. I never disputed that.

So, like it or not, any potential changes to income-splitting will only involve spouses. Not their children. Not their relatives being cared for. Nada.

Potental changes are just that - "potential". The one proposing them is Garth. I am free to advocate a more inclusive set of tax-changes in which the beneifts will flow to more than just the traditional family structure.

Unless you are the Prime Minister or Minister of Finance or have inside information on future bugets, I'm not sure how you can definatively say that future changes "will only involve spouses".

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If I understand this proposal, it is not even really a proposal to tax family income. It is a backdoor way of having one income being offset by TWO-deductions (ie one for each spouse). IMV, if you want to tax family income as a single income, fine, but it should be offset with a single (abliet larger) family deduction in order to be fair to all families. Moreover all family types shoudl be entitled to the same level of deduction and tax tiers.

[Renegade]

On what basis should two siblings or an adult child and his/her parent split their income for tax/benefit purposes? They can move out tomorrow, with zero liability.

I dispute that liability is the basis or justification for pooled income. The most common scenario for persons pooling income is when they have shared costs. Two spouses is the most common example, but it is not the only one.

You have cited the example of when spouses separate, that the higher-income spouse has a financial obligation to share income and wealth with the other spouse. You have also said that parents have a finiancial obligations to support kids.

How is it then when kids move away from home, that they should not expect to take their share of accumulated family wealth with them??

I'm saying that unless such a liability exists (i.e. as with the definition used by Finance/CRA) there is really no basis or precedent.

Again, please show me some evidience that the Finance Dept/CRA uses liability as the basis for determining whether income is considered pooled or not.

[Pat Coghlan]

On what basis should two siblings or an adult child and his/her parent split their income for tax/benefit purposes? They can move out tomorrow, with zero liability.

I dispute that liability is the basis or justification for pooled income. The most common scenario for persons pooling income is when they have shared costs. Two spouses is the most common example, but it is not the only one.

You have cited the example of when spouses separate, that the higher-income spouse has a financial obligation to share income and wealth with the other spouse. You have also said that parents have a finiancial obligations to support kids.

How is it then when kids move away from home, that they should not expect to take their share of accumulated family wealth with them??

They are not the head of the household, I suppose.

Marriage and children have a special status in society, and you can find references to this status pretty much everywhere in our laws etc.

This status supercedes any other relationship that you feel should be used as a basis for income pooling etc. IMHO, it will always be so.

I'm saying that unless such a liability exists (i.e. as with the definition used by Finance/CRA) there is really no basis or precedent.

Again, please show me some evidience that the Finance Dept/CRA uses liability as the basis for determining whether income is considered pooled or not.

I am just saying that they are parallel situtations. Where this liability exists, you will find that things like income pooling/sharing can exist...but not in any other arbitrary relationship.

[Renegade]

They are not the head of the household, I suppose.

True, but does being head of the household have anything to do with ownership of pooled wealth?

Marriage and children have a special status in society, and you can find references to this status pretty much everywhere in our laws etc.

This status supercedes any other relationship that you feel should be used as a basis for income pooling etc. IMHO, it will always be so.

Yes it does, just as once whites had special status in society and men had special status in society. Giving it special status seems to be a code word for finding a way to discrimminate against those who don't agree or adopt that particular societal structure.

This is precisely why I object to the income-splitting proposal as proposed by Garth.

I am just saying that they are parallel situtations. Where this liability exists, you will find that things like income pooling/sharing can exist...but not in any other arbitrary relationship.

OK I get it. It is just your theory but it is not mine. My theory says that you cannot assume income pooling exist in a social structure, but that you have to look at each structure to determine if a pooling arrangement is in place.

Take a commune social structure. I think your theory falls apart here. In this case there is pooling of income, but according to your definintion, no financial liability.

[Renegade]

Something else occured to me. Prior to 1997, when a couple divorced, court-ordered support payments were deductable from the contributor, and taxable to the reciepient, effectively splitting income between the couple. Since 1997 the payments have not been deductable but have been awarded at a level which assumes they will be taxable by the contibutor.

According to your theory, liability still exist between the higher-earning spouse and the lower, so they should be allowed to split income for tax purposes. Does that mean as per the proposal all of the support arrangements awarded since 1997 should be reviewed and revised to assume income-splitting?

[hiti]

Garth Turner also wants an election.

Quote-Mr. Harper is our national leader, and yet he does not embody the nation’s values. He is an aberration of our flawed political system, a party leader elected when not enough of us were paying attention, then chosen by an absolute minority of the people, and yet handed the power of an American president. Such power, he has used in a reckless and arrogant fact, while ironically calling his government ethical, accountable, open and transparent.

But, transparent it has become. And we need an election. Now.

http://www.garth.ca/weblog/page/3/

[Pat Coghlan]

Something else occured to me. Prior to 1997, when a couple divorced, court-ordered support payments were deductable from the contributor, and taxable to the reciepient, effectively splitting income between the couple. Since 1997 the payments have not been deductable but have been awarded at a level which assumes they will be taxable by the contibutor.

According to your theory, liability still exist between the higher-earning spouse and the lower, so they should be allowed to split income for tax purposes. Does that mean as per the proposal all of the support arrangements awarded since 1997 should be reviewed and revised to assume income-splitting?

Alimony continues to be deductible so, yes, divorced couples can income-split.

You are referring to the non-deductibility of child support payments. There is a formula used to calculate these payments and they are loosely based on the needs of the child. Since I receive no deductions for amounts I spend to take care of my own children's needs, I don't have a problem with this recent change. In addition, all divorced parents with the same income and the same number of children are taxed the same - which does not happen with families with identical aggregate incomes.

Perhaps you are familiar with the equivalent-to-spouse deduction which was created out of thin air to give single custodial parents similar tax treatment to parents which have a spouse. I mean, how hokey is that???

[Renegade]

Perhaps you are familiar with the equivalent-to-spouse deduction which was created out of thin air to give single custodial parents similar tax treatment to parents which have a spouse. I mean, how hokey is that???

I'm very familiar with it. But I don't understand your objection. If you truly believe incomes should be taxed as aggregated family income, why should two families, one with two spouses, and the oher with a single-custodial parent and one child, be taxed any differently if they have the same aggregate income?

[scribblet]

Looks like Dion might be coming around to the idea of income splitting

http://www.canada.com/nationalpost/news/ca...80-f63f9e3a2a9d

DION SIGNALS SHIFT ON TAX SPLITTING

Willing To Consider Idea; Liberal Leader Says Garth Turner Has 'Good Ideas'

Liberal leader Stephane Dion yesterday softened his party's position on income-splitting, telling reporters he is "not convinced yet" it is a good idea but refusing to discount it.

It was the Liberals under Prime Minister Jean Chretien who closed a series of loopholes and made it difficult for individuals to allocate a portion of their income to another family member for tax purposes. The Liberals also opposed the Conservative government's "tax fairness plan" introduced in 2006, which permitted income-splitting for pensioners. But Mr. Dion appears to be warming to the idea, thanks in part to the lobbying efforts of Garth Turner, the former Conservative who joined the Liberals last year.

"Mr. Turner has a lot of ideas and many of them are very good," Mr. Dion told reporters yesterday during a press conference in Toronto.

Mr. Turner, who has been Canada's loudest proponent for income-splitting, argues middle class couples could save between $3,000 and $6,000 a year in taxes by attributing a portion of the income of one spouse to another who makes less money.