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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Ichy Smith who wrote (206450)	10/18/2006 5:11:25 PM
From: jttmab	Read Replies (2) \| Respond to of 281500

Because anyone who is going to make a big salary wants it to be in the US because your taxes are just under 1/2 the rate in Canada. Then by your theory the US must have much lower homeless rates than Canada does. How does that check out? Ooops, guess it doesn't. Let's try this one. ... Israel has the highest taxes of any country I've heard so their homeless rate must be much higher than Canadas. How does that check out? Why? because it is cheaper to produce in California than it is in Canada. Hollywood is producing more films in Canada because it's cheaper; US automanufactures like the cheap labor in Canada along with not worrying about paying for health benefits. There's a whole bunch of Americans that have moved off to the Czech Republic. Of course our lumber producers don't like to have your soft lumber in our country. Our cattle industry doesn't want your stinky beef either. It is easy to sit in a low tax jurisdiction and talk about different taxes. You seem to have no trouble in a high tax jurisdiction and talk about different taxes. It's easy to talk about different taxes regardless. How would you care to compare what percentage of disctretionary income that Americans pay out of pocket vs. what Canadians pay [national averages]? Because anyone who is going to make a big salary wants it to be in the US because your taxes are just under 1/2 the rate in Canada. If they really want the "good life", they should go to those States with the lowest tax burdens. Where they get the most bang for the buck. The highest standard of living. The five best States to live in are: Alabama Alaska Mississippi Oklahoma Tennessee taxfoundation.org Now you know the best places to live if you want to give up on Canada. jttmab

To: Ichy Smith who wrote (206450)	10/18/2006 6:06:51 PM
From: geode00	Read Replies (1) \| Respond to of 281500

The Canadian Tax Advantage Summary Large- and medium-sized businesses: Five percentage points lower average corporate tax rate in Canada than in the U.S. by 2005. Small businesses: Significantly lower corporate tax rates in Canada on income above C$75,000. Capital gains: Two percentage points lower average top tax rate in Canada than the typical top capital gains tax rate in the U.S. A C$500,000 lifetime capital gains exemption for small business shares that has no equivalent in the U.S. Research and development: A 20-per-cent research and development (R&D) tax credit in Canada for all R&D expenditures compared to the U.S. 20-per-cent credit for incremental R&D. A 35-per-cent refundable tax credit available to smaller Canadian-controlled private corporations; no equivalent in the U.S. Background In 2000 the Government of Canada introduced a Five-Year Tax Reduction Plan – the largest tax cut in the country’s history. Under this plan, personal income tax rates were reduced at all income levels and a number of tax measures were introduced to create a tax advantage for investment and entrepreneurship in Canada. Lower Corporate Taxes Large- and Medium-Sized Businesses Recent tax changes in Canada will reduce the average Canadian business tax rate to 5 percentage points below that of the U.S. by 2005 (see table below). Small Businesses Although average corporate tax rates in Canada and the U.S. are similar on income up to C$75,000, they are significantly lower in Canada on income above C$75,000. Start-up high technology companies in Canada can already benefit from several tax provisions that are more advantageous than what is available in other countries. These provisions include a C$500,000 lifetime capital gains exemption, low tax rates on small business income, and generous tax credits for research and development. Greater Access to Capital Capital Gains Tax Advantage In 2000 the capital gains inclusion rate – i.e. the portion of a capital gain that is subject to income tax – was reduced to one-half. This adds to the Canadian tax advantage, especially for start-up companies. Businesses in Canada now have greater opportunities to raise financing. The lower inclusion rate for capital gains makes investment and risk-taking more rewarding by allowing investors to retain more of their gains. As a result of this tax change, the typical top tax rate on capital gains is now lower in Canada than in the U.S. This makes it more attractive for individuals to make such investments in Canada. Research and Development Eligible expenditures in research and development (R&D) qualify for a 20-per-cent R&D credit, while smaller Canadian-controlled private corporations benefit from a 35-per-cent refundable tax credit. As a result, Canada offers one of the most generous scientific research and experimental development tax incentive regimes in the world. For Further Information For further information about the Government of Canada’s Five-Year Tax Reduction Plan, visit the Department of Finance Canada Web site at www.fin.gc.ca. Current and Proposed Corporate Tax Rate Comparisons – Canada vs. the United States 2002 2005 (per cent) Canada Federal income tax rate1 26.12 22.122 Provincial average income tax rate3 12.0 9.4 Ontario 12.5 8.0 Alberta4 11.5 8.0 Quebec 9.0 8.9 British Columbia 13.5 13.5 Newfoundland and Labrador, Northwest Territories, Nunavut 14.0 14.0 Yukon 15.0 15.0 Manitoba 16.5 15.0 Nova Scotia, New Brunswick, Prince Edward Island 16.0 16.0 Saskatchewan 17.0 17.0 Federal-provincial income tax rate 38.1 31.5 Federal-provincial business tax rate (including capital taxes)5 41.5 34.6 United States Federal income tax rate 35.0 35.0 Average state income tax rate6 4.0 4.0 Federal-state income tax rate 39.0 39.0 Federal-state business tax rate (including capital taxes) 40.0 40.0 Difference between Canada and United States Income tax rate -0.9 -7.5 Business tax rate (including capital taxes) 1.5 -5.4 1 The federal surtax remains at 1.12 per cent. 2 The federal tax rate will drop to this level in 2004. 3 Provincial average income tax rate is a weighted average. 4 Rate effective April 1, 2002. 5 The income tax rate equivalent of capital taxes has been included. 6 The state income tax rate is the effective rate after taking into account the deductibility of state taxes for federal tax purposes. fin.gc.ca