June 2020
Every so often you hear the argument that the rich should pay their “fair share”, but you never really get an answer to the question of how much is enough?
It’s too easy to claim that the rich don’t pay enough tax because of the size of their bank accounts. Do you want them paying more that 60% of their income in taxes? How about 70%? Is 80% enough or do you basically want them to hand over all their money to the state?
Some millionaires inherited their fortunes or were lucky enough to win the lottery, but many earned their money by starting successful businesses, creating a new product or they invested in other successful businesses. These businesses pay taxes to the state and provide jobs to other workers. Sure, some businesses receive generous tax breaks, which can be both good and bad to the tax base.
Some are basically accusing these millionaires of being tax cheats. Sure, there are some who use morally or legally questionable, if not outright illegal, schemes to lower their tax bill, but most millionaires are just taking advantage of legal tax breaks that are available to anyone.
“But I can’t afford a high-priced accountant like millionaires,” is a common complaint. The reality is that you don’t need a high-priced accountant; you just need a competent accountant. Any accountant who is knowledgeable in tax law, or even better one who specializes in tax law, can get you the same tax breaks as the millionaires.
That aside, these days you don’t necessarily need an accountant to do your taxes. The Canada Revenue Agency web site will guide you through the tax-filing process or you can purchase your own tax software for your home computer, which will also guide you through the process.
Still another option is to read up on tax law yourself. Sure, you may not have the time to pour over all the necessary books, which is why most of us use computer programs or hire an accountant, but the information is out there and is available to anyone who wants it. You don’t need to be the member of a special club to get this information and do your own homework on tax law. Knowledge is power.
Saying that all millionaires should pay more tax does have the potential to bite some people in the rear-end. What if you are the one who establishes a successful business and suddenly find yourself a millionaire? In a capitalistic society, anyone can find themselves suddenly rich. Would you want to pay more tax then?
Just like students who say university should be free, sometimes you have to be careful what you wish for. I wonder if the students who hold that view still feel the same way when they get into the workforce and it’s their turn to pay their “fair-share” of taxes to support the next generation of university students who are taking advantage of the “free” university education that you fought so hard to get.
