OTTAWA — The Office of the Auditor General of Canada says the federal government wrote off billions of dollars last year in COVID-19 benefits that it no longer expects to see repaid.
I’m not going to lie, this frustrates me.
I had just gotten a job and out of homelessness when COVID hit, and it was heartbreaking that because I had just started my job at Walmart only a few months prior, I was ineligible for CERB.
So a bunch of people who were ineligible, signed up anyways, and then later cried about needing to repay it now get a get out of jail free card?
Like you decided rules don’t apply to you and that honesty wasn’t the best policy. Why is the government giving these people free money when people like me who played by the rules and actually needed help get nothing?
You’re only scratching the surface on how much bullshit that period was.
Ceba loans allowed small businesses to borrow up to $60k. If they repaid it on time, they only had to repay $40k. The repayment was interest free, and was extended twice (2 years). So people could get the money in 2020, and hold on to it until the start of 2024, about 3.5 years give or take in your bank account.
To qualify, you were supposed to have payroll in 2019 that exceeded $20k. Checking eligibility was given about as much rigor as the CERB program, though you still generally needed a business license to qualify.
What’s important to know about this, is that many people are ‘contractors’ these days, who are essentially playing the tax game to try and avoid taxes as part of a more gig-oriented mentality. For example, I know truck drivers who are ‘contractors’, who incorporated as a business – a business with just themself as an employee. The companies that employ them, pay the numbered company, and the numbered company pays the single employee amounts needed for day to day, while keeping most money back in a lower business tax oriented account. Tech people do this too quite a bit, I’ve known whole departments at companies like EA, where everyone was a contractor doing this same thing.
These sorts of people were able to get $60k from the government. They put it into the stock market / savings accounts for 3.5 years, letting it generate investment income - even at a low of 2% yoy interest, they’d earn about $4200 as interest during the period. At the end, they paid back $40k, or $60k if they were caught being ineligible. They were being handed between $4200 and $24200 from the fed, all they had to do was ask.
People didn’t “need” the money in many cases. But if the government was handing it out for free to everyone else, and they didnt also put their hands out for their “share”, they’d be left behind / at a disadvantage. The same sort of “hoard all the toilet paper!” mentality, applied to government assistance.
My god
heheh, you want to get even more annoyed? This ones partly theoretical in relation to the new budget, admittedly.
One way this sort of small business setup gets used, is to disperse a high income earners wealth amongst their family, to avoid tax. If the ‘company’ net income, not including salaries, is like 200k from the people who are “really” working, and they have like 3 kids / 1 spouse, they can ‘employee’ their kids/spouse and pay them just shy of the amount that requires they pay income tax. The family members can then gift that money back to the household - gifts are tax free. Normally someone earning $200k would pay about $74k in tax (no spouse splitting, single income earner). If you spread that around the family, with a split of like 60k/60k/13k/13k/13k and 41k for the business ‘profit’, you’d be paying (very rough estimates) about 8.3k/8.3k/0/0/0 and 6.1k in tax, for a total of ~$23k tax. You keep like 50k more of your wealth, likely with a bunch of it in Panama.
Here’s the more theoretical part. The budget includes a $45k tax credit for ‘artists’, which means if your kids an artist you can increase that $13k threshold to $45k (I think, it’s still not totally clear how it’ll function). Wanna bet a bunch of wealthy people’s kids are gonna become ‘artists’ in their teens / as soon as they’re eligible to work? Carney’s budget’s helping open loop holes for the wealthy.
The truck driver and tech workers in your example are bottom of the barrel for that kinda stuff. You should be mad at big business and corporations that force the hand of those workers.
People making fuck all aren’t the problem and never will be, they’re a drop in the ocean of fraud and tax manipulation that goes on. It’s unreasonable to hate on the little guy, when much bigger players are the actual cause of the little guy doing that at all. If we had proper employment rules that don’t have loopholes for abuse, all of that would stop and all those guys driving for themselves would be driving for a company on a wage with a pention. Instead we are all making fuck all while the wealthy milk us for every red cent they can
There’s no reason you can’t go after both types of abuse.
And a tech worker that’s been earning a salary of like 140k+ for years, is not having their hand ‘forced’ to take scammy govt money. The only reason they aren’t taking more, like those ‘big businesses’ you reference, is the lack of opportunity to do so.
