Comments by "Pac Man" (@pacman3556) on "CP24" channel.

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  43. I am not a tax expert and others here may have described it better than I can but currently only 50% of capital gains is taxed and it is taxed at the marginal tax rate that a person falls into. Example of you make $100K in capital gains you only pay taxes on half of that (or $50K) and of that $50K that you are taxed on you are only taxed at your marginal tax rate which would be around 33%. So if you make $100K in capital gains income you would end up paying around only $16-17K in total income taxes ($50K times by 33% tax rate). Now compare that to someone that earns $100K in income through a job. That same $100K is completely taxable and would be at the same marginal tax rate so someone earning $100K through a job would pay around $33K in taxes Both examples someone earns the same amount of money but in the first example someone that doesn't work but earns money through an investment pays about half of what an individual does making the same amount of money working at a job. What the govt would like to do is change the total amount of capital gains that can be taxed from 50% to 66% so the person that making money through capital gains pays taxes on $66K instead of only $50K thereby making them pay more in taxes or a closer amount in taxes then someone that actually earns the same amount through income or a job. The reason behind this is rich people tend to make more money through passive investments or capital gains vs the average employee that makes their money through working at a job. It is a way to make rich people pay more of their fair share (i.e. why should someone working a full time job pay more than a rich person not working at all for the same income). Nobody is going after a working person making $100K or more. And nobody is going give up 50% or 66% of their total income (whether a job or capital gains) in taxes. This is just decreasing the amount people can write off from their income because it is a capital gain. Yes I know this is very simple in terms. It is more complex and because it is a marginal tax rate 33% is just the final bracket. There are ranges (15% for under 55K, 20%- 55 to around 100K etc). Also people can put money into things like RRSP and other deductibles to help lower their income and tax rate etc. but this was just meant to be simple for explanation purposes.
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