The Trudeau Liberals 2016 Tax Plans

[George Wallace]

Thank you Justin.  I am an "average Canadian" and I like the TFSA, even though I may not be able to take advantage of it fully every year.  It is still a tool I can use towards saving for my future.  I think it is you who is not "listening to average Canadians".

http://www.theglobeandmail.com/news/news-video/video-justin-trudeau-defends-tfsa-reduction/article27652370/


Reproduced under the Fair Dealings provisions of the Copyright Act.

Say goodbye to your $10,000 TFSA, but here’s why it’s not so bad
The Financial Post
Garry Marr | December 7, 2015 6:15 PM ET

The protests were never going to work. The Liberals campaigned against a $10,000 annual tax-free savings account annual limit. Now, with Finance Minister Bill Morneau announcing Monday that the extra room is being taken away, it’s time to accept it, and move on.

...................

More on LINK.

 

[Altair]

Thank you Justin.  I am an "average Canadian" and I like the TFSA, even though I may not be able to take advantage of it fully every year.  It is still a tool I can use towards saving for my future.  I think it is you who is not "listening to average Canadians".

http://www.theglobeandmail.com/news/news-video/video-justin-trudeau-defends-tfsa-reduction/article27652370/


Reproduced under the Fair Dealings provisions of the Copyright Act.

More on LINK.

I know very few people who use their TFSA to the fullest. I only know a few people who use it at all.

Maybe we run in different circles, but the average Canadians I know don't care one way or another about TFSAs.

Bills, car payments, child benefits, ya, people I know care about that. TFSAs. Meh.

 

[Bird_Gunner45]

I know very few people who use their TFSA to the fullest. I only know a few people who use it at all.

Maybe we run in different circles, but the average Canadians I know don't care one way or another about TFSAs.

Bills, car payments, child benefits, ya, people I know care about that. TFSAs. Meh.

TFSA's are actually a very good way of saving money and most of the people we deal with use them once they understand what they are. In many ways they are superior to RRSPs, which for most military members a very poor means of saving as it is a deferral of income tax payable vice tax-neutral. The TFSA, being tax neutral, in the long run works much more effectively (the rate of growth of a RRSP will NEVER be more than the income tax rate). The trick with investing in stocks, RRSPs, etc is that you have to have enough time left to make them effective, or in effect, to survive the inevitable "peaks and valleys" of the stock market.

My quick google check indicated that approximately 47% of Canadians have one which is pretty sizable (8% more than who voted Liberal, for example). I would agree that a $10,000 annual limit is pretty high for an average individual ($833.33/month) but not so high that is beyond the realm of possibility that it is achievable (people without mortgages, double incomes, etc). Whereas the income splitting helped single income families, the TFSA was beneficial for 2 income families with the ability to save (and promoted saving, which is what the government wanted) as it had the potential to save them $3000-4000/year based on their effective tax rates. Now, both groups are reduced in their ability to save money on taxes.

C'est la vie.

 

[Fishbone Jones]

I know very few people who use their TFSA to the fullest. I only know a few people who use it at all.

Maybe we run in different circles, but the average Canadians I know don't care one way or another about TFSAs.

Bills, car payments, child benefits, ya, people I know care about that. TFSAs. Meh.

So, because you don't have any, or know anyone who does, it can be done away with.

Reminds me of another analogy: When a Conservative doesn't like guns, they don't have any. When a Liberal doesn't like guns, no one can have any.

 

[Brad Sallows]

>I know very few people who use their TFSA to the fullest. I only know a few people who use it at all.
> Maybe we run in different circles, but the average Canadians I know don't care one way or another about TFSAs.

I see you follow the progressive/"liberal" template for evaluating the merits of a policy: if you don't like it, and don't know many other people who like it, no-one else needs or deserves it.

[Late again.]

 

[George Wallace]

I know very few people who use their TFSA to the fullest. I only know a few people who use it at all.

Maybe we run in different circles, but the average Canadians I know don't care one way or another about TFSAs.

Bills, car payments, child benefits, ya, people I know care about that. TFSAs. Meh.

I have to agree with the others who have commented on your post.  It is a totally mindless and ignorant response.  It would seem that you don't even have the most basic knowledge on fiscal management.  TFSA's are not for the here and now.  This is not Mcdonalds.  They are for your future.  Too bad you can not see that.  To put all your eggs in the Lieberal basket and follow their propaganda religiously in blind anticipation of some promised land, really does not make any sense to me.  I could say I pity you, but that would be a waste of effort.  You still would not understand. 

 

[jmt18325]

That doesn't change that people weren't using them to their full extent (and still won't be) and certainly wouldn't have been using them to their full extent with a $10K limit.  Whether or not their smart policy in theory, they weren't smart policy in practice.  An increase in CPP will mean that Canada has to spend less on GIS in the future.  TFSAs don't guarantee that.

 

[brihard]

TFSAs are a wealth transfer in favour of the most well off, at the expense (through offset taxes) of taxpaying Canadians who cannot afford to maximize their contributions. That's pretty manifest just by a basic look at the math.

I have no problem with TFSA's conceptually, but there's not a policy justification for them beyond the extent to which they're accessible to the average Canadian. There was nothign wrong with the indexing $5k cap.

Does it suck a bit for me? Sure; I am a person who is in a position, with sufficient financial discipline, to maximize contributions. As is my partner. But my self-interest does not sound policy make. More tax breaks for the wealthy are not called for, and that, in its ultimate effect, is what a TFSA is.

 

[George Wallace]

That doesn't change that people weren't using them to their full extent (and still won't be) and certainly wouldn't have been using them to their full extent with a $10K limit.  Whether or not their smart policy in theory, they weren't smart policy in practice.  An increase in CPP will mean that Canada has to spend less on GIS in the future.  TFSAs don't guarantee that.

How about "Bank Accounts"?  People aren't using them to their full extent.  Does it really make any sense to blame everything on "It only benefits the rich"?  That is crap.  It benefits all who chose to use it, and does not benefit all who chose not to use it.  Quite simple really.  It is after all, your future that you have to plan for, and perhaps make sacrifices to achieve, not the Government's.  The Government, however, is giving you a means to save for your future and do so tax free.  It is pure BS to say that only the rich benefit.  Sorry, but no matter what option there is to save for a rainy day or retirement, those with the most disposable monies to put into any of those plans will always benefit more.  So; YES the rich do and always will benefit more.  Fact of life.  Taking away the option to save from ALL Canadians has little affect on the rich, but causes serious harm to the lower income earners.  Life is not fair, but given the option of plans like the TFSA, there exists an attempt to make it a little more so. 
Just think of this:  Justin Trudeau, and many of his Cabinet, come from well to do families.  Taking away a plan that allows ALL Canadians to save for the future and avoid taxes has little to no affect on their wealth; only that of the Middle Class and Lower Class.  This would point to the fact that Trudeau really doesn't give a damn about the Middle Class, nor those below the Poverty Line.

 

[Fishbone Jones]

Why give a damn about something(middle class) that he knows nothing about or has been unable to define since he uttered the phrase.

The Trudeau Liberals don't want you self sufficient in retirement. They need you to stay insolvent and beholden to the government in order to bribe you into electing them again.

 

[Altair]

Why give a damn about something(middle class) that he knows nothing about or has been unable to define since he uttered the phrase.

The Trudeau Liberals don't want you self sufficient in retirement. They need you to stay insolvent and beholden to the government in order to bribe you into electing them again.

Yes, i'm sure thats it.

 

[Brad Sallows]

Nearly every vehicle for mitigating tax exposure will benefit wealthier people more than less wealthy people.  As objections go, "it benefits the wealthy" is close to zero - it is like observing that the sun rises in the east.

TFSAs and RRSPs fall into that category.  What sets them apart from fancier tax avoidance schemes is accessibility.  The relentless hostility emanating from some quarters toward anything that might be accessible to "average" people is irritating.

Adherents of some political factions may not want people "insolvent and beholden", but it is foolish to not understand that everyone is capable of thinking things through and setting their aims and policies accordingly.  People with fewer options are easier to control, manipulate, and manage.  Mostly unfettered liberty is not a baseline principle of leftist politics.  People who favour activist, broadly involved government will want to find ways to compel other people to go along with activist, broadly involved government.  They will identify courses of action, they will make plans, and they will execute.

 

[cavalryman]

People who favour activist, broadly involved government will want to find ways to compel other people to go along with activist, broadly involved government.  They will identify courses of action, they will make plans, and they will execute.

As a noted law professor likes to say, there's also more opportunity for graft under an activist government (see green power generation in Ontario, AdScam, carbon cap & trade, etc, etc, etc)

 

[a_majoor]

The TFSA is a very flexible plan which allows the average saver much more room for manouevre than even an RRSP. Progressives do indeed hate ideas and plans which provide the average taxpaying citizen to make their own plans and decisions: these are usually not in accord with whatever the Progressives deem to be the right and proper things to do:

http://army.ca/forums/threads/69927/post-684595.html#msg684595

 

[jmt18325]

How about "Bank Accounts"?  People aren't using them to their full extent.  Does it really make any sense to blame everything on "It only benefits the rich"?  That is crap.

There's nothing wrong with being rich.  The reality is, TFSAs don't solve the problem of low savings, as they had a relatively low use rate (at least in any meaningful way).  The comparison to bank accounts is nonsense.  There are better ways to use finite government revenues.

 

[George Wallace]

:

There's nothing wrong with being rich.  The reality is, TFSAs don't solve the problem of low savings, as they had a relatively low use rate (at least in any meaningful way).  The comparison to bank accounts is nonsense.  There are better ways to use finite government revenues.

:
Whoosh right over your head.

 

[jmt18325]

: :
Whoosh right over your head.

To the contrary, I understand exactly what you're saying, I simply disagree.  If we want people to save, we'll have to make them, as we did with the original CPP.  In the end, it will cost the government less.

 

[George Wallace]

To the contrary, I understand exactly what you're saying, I simply disagree.  If we want people to save, we'll have to make them, as we did with the original CPP.  In the end, it will cost the government less.

The CPP is not a savings plan.  It has a maximum monthly payment out to contributors, and penalties for those years that one did not contribute.

Seriously.  It is everyone's right and initiative to save on their own.  The TFSA is one such means available.  Others, with more knowledge and money, may invest in Real Estate.  The TFSA, however, is available to ALL, not just the wealthy.  If you are somehow under the impression that the Government will support you in your retirement years through the CPP, then you are truly unfortunate and will be in a real world of hurt when that time comes.  If you want to live a little more comfortably in your retirement years, YOU have to take the initiative to save by other means, or you will be "eating catfood from a tin".  It would appear that this Government in making these cuts to the TFSA contributions, is leading you down the garden path towards the day that you will be "eating catfood from a tin" if you can afford it. 

As you see, I strongly disagree with your point of view that the TFSA is a bad thing and not a good means for people of all incomes to save.  I, in fact, think you are naive and foolish.  Sorry.  That is my opinion.

 

[jmt18325]

It's not the TFSA that I have a problem with - it's the doubling of the contribution limit.  I have a TFSA and I use it.  There's no way I, being squarely middle class, will ever contribute $10,000 a year (not that I think government should always benefit me, that's not my point).  That is true of over 90% of people.

The CPP is a pooled pension plan with assets.  Increasing the in and out there will go a long way to protecting the government from large payouts (transfers to individuals eat up double the amount of the federal budget that DND does) in the future as the population ages.  The TFSA also does that, but much less so.  I think a mixed approach is the best.  I'm in favour of having a moderately sized TFSA and a moderately sized CPP increase.

 

[George Wallace]

It's not the TFSA that I have a problem with - it's the doubling of the contribution limit.  I have a TFSA and I use it.  There's no way I, being squarely middle class, will ever contribute $10,000 a year (not that I think government should always benefit me, that's not my point).  That is true of over 90% of people.

Seriously.  So what.

If at some time in the future, you become a high income wage earner, you can take advantage of the higher limit.  Or perhaps you won the Loto and wanted to hide some, the TFSA would be there.  Heck, you could fill your TFSA for all the shortages you may have had in previous years, and then throw some into a RRSP  and any other plan you want.  Just because the limit is higher than YOU personally can not max it out, doesn't mean that other Canadians have to suffer for your shortcomings.  This is not a Socialist, nor a Communist, country yet.  You are exhibiting very narrow views on your sole existence, ignoring the opportunities offered to others who are not in the same boat as you.  Your views in fact will lead more to poverty and deficits than not.

A quote attributed to Margaret Thatcher goes along the lines of

"The problem with socialism is that eventually you run out of other people's money [to spend]."