CHAPTER 16

GIMME GIMME MORE ..... $ :)

SUMMARY

This article talks about some of the new government regulation and policies on income taxes in 2009.

According to the Canadian Taxpayers Federation, the higher employment insurance and Canada Pension Plan payments will wipe out skimpy tax cuts for many Canadians in 2009.

In the past, CPP contribution limits are nomally raised each year while EI rates are lowered, which makes the overall increase to payroll taxes very small. (Payroll taxes are federal taxes that an employer is required to withhold and/or to pay on behalf of the employees. the employer are required to withhold federal income taxes as well as social security and Medicare taxes from the employees' wages. The employer is also required to pay a matching amount of social security and Medicare taxes for the employees and to pay Federal unemployment tax.)

But next year, both the EI and CPP contribution limits are giong to increase. Canadians will pay an additional $188 in payroll taxes, said the federation in its annual new yer tax change calcualtions.

CONNECTION

Part of this chapter talks about payroll dedcutions (as described above as payroll taxes)

employment insurance - designed to replace a portion of lost wages to qualified employees who are laid off because of lack of work or who become ill for an extended time. Working Canadians pay a percentage of their earnings into this government-run insurance program.

and the Canada Pension Plan - which are retirement plans administered by the government. Generally, the amount you receive when you retire depends on the amount you paid into it. Canadians are fortunate to have access to a wide range of government programs and support services. To cover their cost, every working Canadian pays a portion of their earnings to the federal and provincial governments in the form of income tax. Higher-income earners pay more than those who earn less.

These payments all have a certain amount of contribution limits in order to receive the desired amount of renumeration and tax returns.

REFLECTION

Canadians are fortunate to have access to a wide range of government programs and support services. To cover their cost, every working Canadian pays a portion of their earnings to the federal and provincial governments in the form of income tax. Higher-income earners pay more than those who earn less. Some people deabte about our income taxing system, where it is unfair for a higher income earner to pay more income tax, this restricts the individual to advance for a higher paying job. But some argue that the higher income earners have the responsiblity to help contribute, usually to the lower income earners.