🚀 go-pugleaf

In article <4varve$940@fountain.mindlink.net>, "D. Rodney Smelser"
<rod_smelser@mindlink.bc.ca> wrote:

> bn207@FreeNet.Carleton.CA (Patrick Coghlan) wrote:
> >
> >Lyle Craver (lcraver@vcn.bc.ca) writes:
> >> In article <4uoiqo$1aii@uvaix3e1.comp.UVic.CA>,
> >> klassen@uvaix3e1.comp.UVic.CA (Melvin Klassen) wrote:
> >>>The tax is calculated at the end of each pay-period, i.e., "pay-as-you-go",
> >>>until the "cap" is achieved.
> >> 
> >> The bad news is that starting Jan 1, 1997 Unemployment Insurance
(soon to be 
> >> renamed Employment Insurance) is to have a cap that's to be administered 
> >> exactly the same way as Canada Pension. If memory serves the cap is
at $39,000 
> >> of 'insurable earnings' with virtually no deductions - e.g. the 15
hour/week 
> >> rule is being eliminated.
> 
> This change in EI rules is designed to level the playing field between 
> full and part time workers.  Since part-timers will no longer be 
> artificially less expensive than full-timers, there will be less 
> incentive for employers to offer one job to three people.

It results in everyone earning more than the new cap ($39K) paying their yearly
EI premiums at an accelerated rate.  If the purpose is to collect the
premiums from
the part-time workers, then let them pay 3.4% of their earnings from each
paycheque,
but let the full-time workers pay 3.4%*maxOf(salary, cap)/26.  It's not that big
a change for payroll software.

> >What!  You mean that people earning $50-$60K+ are going to have 50-100%
> >higher UI/EI premiums for over half the year now!  What's next, giving the 
> >government everything you earn up until June 30th and then keep the rest???
> 
> The big increase in premiums will be among part-timers whose annual 
> incomes are much less than $20K.

I call an increase of 100% or more for high-income earners a big increase.

> >I'm getting tired of more tax grabs.  Can we have an election please so that
> >we can get some TAX BREAKERS elected?
> 
> Where is the tax grab?  The premiums go into the EI account, and 
> surpluses there are for years when benefit payouts rise due to 
> recessions.

It's a tax grab because: a) I can't opt out of the "insurance" plan, b) I
have to pay
all my premiums in 6 or 7 months versus 12 and c) the cap was just raised from
$34K to $39K (or something like that).

> >It's bad enough that we already have lots of high tech people moving to
> >the US.  Over the weekend I heard some stories of chartered accountants 
> >moving to Bermuda for a few years where they pay ZERO income tax and only
> >a 4% health tax.  
> 
> Bermuda eh?  Is this your idea of news?

It was news to me that Canadians can just move there and earn a tax-free
income.

The real news though is that tax rates are now a big factor in where
professionals choose to live and work.  When I graduated in the early
80's, it was very rare for graduates to seek out work in the US.  Now,
attrition to the US is one of the biggest problems that human resources
departments in the high-tech sector are having to deal with.

> >This type of talent migration is only going to accelerate once Bob Dole
> >gets elected and the top combined tax rate drops to something like 34%
> >just across the boarder while we are still struggling with 50%+ in most
> >provinces (except Ontario in 1999).
> 
> 
> What is the current combined marginal tax rate in Ontario?  What will it 
> be in 1999?

Up until this year it was around 53%.  It will drop to about 49% by 1999.

-- 
-Pat
bn207@FreeNet.Carleton.CA