There is often a saying that goes around that the “rich get richer and the poor get poorer”. So when the phrase Ontario wealth tax hits the media it does cause some various thoughts from both sides of the fence.
The average income bracket thoughts….
For those that are in an average income bracket they naturally are concerned about what tax bracket they will fall into when it comes tax time. The higher the income the more tax you are going to pay. While on the surface this may seem like a fair and just taxing method there is one argument that is raised by many tax payers. For those in the average income bracket the taxes payable can create a real hit on the money they are working hard to make, and it makes it difficult for them financially. For those in the higher income bracket who yes are paying more income tax, they are perceived as making enough money that they can afford it. So for some what is classed as a fair tax system doesn’t take into account affordability.
The higher income bracket thoughts….
For those that are in the higher income bracket their argument against having to pay a higher tax is that they have perhaps worked harder or longer, and taken more risks to get them into the income bracket that they are in. By having to pay higher taxes it is almost like they are being punished for their efforts.
These two arguments are open for conjecture as there are valid points raised on both sides. The bottom line is that taxes paid means the money collected from this is meant to be spent on the betterment of the country, province and cities. The one argument that many tax payers seem to agree upon is where is the money actually going? Is the Canada tax payer actually seeing a return for their tax dollars?
Narrowing it down to Provincial tax for Ontarians, the new Ontario “wealth tax” imposed was a 2% increase in the tax rate on income that exceeds $500,000. This new tax bracket is being phased in over 2012 and 2013. This phase in of course just adds to the complexity of the tax filings for the Ontario businesses but fortunately there are Toronto tax accountants that have a good handle on this and will be able to compile the tax returns for businesses in the “wealth tax” category efficiently.
One thing this new tax bracket is going to create is an renewed interest in tax planning. Again there are experts in this field such as the Toronto tax accountants and those who specifically specialize in tax planning that will work hand in hand with the wealthy tax payer.
