106. Taxing Homeowners In Canada – CMHC Report Reaction

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Charging a annual surtax on homes that are valued at more than a million dollars. Now, just when I thought.

The world couldn't get any dumber.

I read this article and I remind myself that I'm not surprised by much anymore. And if you haven't seen this article, so this is we of course give publishing credit to BNN Bloomberg for sharing this. This is a reaction video to this article where CMHC backed report calls for a surtax on million dollar homes. Now the report describes this surtax as a solution to a problem. And whenever we think of government and we think of problem and solution in the same sentence, one word comes up Tax. And these programs, among many others are absolutely illogical and and completely ridiculous because they're described in the format of how much additional revenue they're going to generate. Like the government is in a revenue generating business. The government is in the business of thievery, plain and simple. I am completely for paying taxes, providing critical infrastructure programs that help people who are in need. I am for all of that. But this kind of crap?

I also like to have my roads cleared.

Okay, right, we can describe a million.

Things, sure, Valuable resources and systems provided by agreed.

But come on. While these fat cat politicians are receiving increases in pay guaranteed pensions that most Canadians could only dream of for four.

Years, that are indexed to inflation which is rapidly increasing right now, where the.

Hell does someone get off putting a report together that suggests something as stupid as this? Because where does it end? Oh, this is going to produce 4 billion, 6 billion, 10 billion. What on earth do you think they're going to do with the money? They're going to put the money toward programs that increase the size of government, that increase the size of of public government bureaucrats and the pensions you have.

To be on the hook for for their life.

Guess what they're going to need when they manage the programs just as ineffectively as they do everything else. They're going to come back to hardworking Canadians and say we need more tax. Nobody's really talking about the problem, including the boneheads that put this report together. Nobody is publishing articles about how the government needs to reduce its spending, not bring in more to spend more. We all know how business effective the government at doing that.

Horrible we're printing money like drunken sailors. We're strangling the very backbone of our economy, small businesses who employ hardworking Canadians, and we're strangling them. And then somebody, some group has the nerve to put a study together that says, again, let's target. Let's make sure that we go after. Whether you describe it as the wealthy. Well, hey, let's not only go after their wallet, let's go after the equity in their homes as well. And do you think, Richard, logically, that that's where it ends? Do you think for a moment that that's where it ends? If you give the government reach, they immediately go for overreach. And that means that you. And I'm talking to you, hardworking Canadian, you're paying your mortgage, you're building equity in your home. Please tell me that you're not doing that so that some dirty government bureaucrat can convince you that more tax is the answer to the problem. It is absolutely offensive, ridiculous. And you know what? They think that you and I are dumb, that we're just too dumb to understand what's really going on. Well, it's offensive.

Here's a couple of things. So first off, the group that put on this, whatever this study is and speaks about it in the article is that they're looking at the problem of housing affordability. That's the problem they're looking at. But they. So they. They're looking at it as though the issue is the price of housing. No, the issue isn't the price of housing. The issue is how did the housing get to this degree of pricing? Oh, it's. So they're looking. They're looking at the wrong problem. They think the problem is the price of housing. It's not. The problem is how did the price of housing get to this and what are the underpinning factors that. That led to it? So we're going to show you another graph from the Federal Reserve here in a little bit. And before I leave that topic, it's really important. I want to identify from Nelson's book, this is under Willie Sutton's law on page 29. So anyone who's got a copy of Nelson's book, becoming your own banker. If you don't, you're watching. Please get a copy. There's a link down below Nelson. See, Willie Sutton was a bank robber and he was famous for robbing banks. He would get out of jail, he would go rob another bank, get in, get out of jail, go rob another bank. And they said, willie, why do you keep Robbing banks.

He's like, well that's where they keep all the money.

So Willie Sutton's Raw is all about legal plunder. Legal plunder is basically, you know, effectively what the tax system is. Again, we're not saying there's no value in that system that we get value for that. I'm not saying we don't. But let's just get clear that it's a parasite host relationship. Government is not capable of producing anything. It gets all of its sustenance from the productive element of society. Government is a parasite and lives off the productive taskspayer taxpayers, the host. It is self evident that if the parasite takes all of the produce of the host, then both parties die. This is right out of Nelson's book. And then he talks further about, you know, when government creates a problem so taxation becomes onerous. That's the, you know, the taxation becomes too much to the point where government officials sense a rebellion in the marketplace. They always resort to exceptions to the rule that they've created. So rather than saying, hey, we're going to give you a tax break by actually cutting, reducing the tax payable, we're going to say no, we're going to create a convoluted program that requires administration, administrators, we're going to, you know, it requires a change in policy and all this extra clap trap which means more government workers are required to administer the whole thing. And then we're going to give you a tax break if you do this exception. So we're going to give an exception to the rule we created under the guise of saving tax. But we're not actually just going to reduce the tax. It would be much simpler if they just reduce the tax. Yeah. And it would save all parties, the accountants, the bookkeepers, the other costs you have to pay for the new rules that they need to learn every year all the way trickle down through the system by just saying, oh, what you guys want to say? Well, because paying too much tax. Okay, well rather than creating a weird convoluted crediting tax break deduction system, let's just notch it down a little bit and we'll have the same effect but it far easier to implement across the board.

There's a program on television and the name of that program is titled Intervention now this program showcases some really tragic experiences that people have in suffering from addiction, whether it's addiction to.

Narcotics, alcohol, gambling, etc. Tragic, tragic stories. And one of the critical elements that seems to come up every single time is enabling.

And you'll see in the Interviews that happen where a counselor or somebody who is maybe even recovering themselves is sharing with the family. You're continually enabling this person's addiction. You're giving them money to buy the drugs. You're giving them money to go and gamble it away every time you're asked. And you succumb to the pressure and you're enabling. Well, as citizens of this country.

That is precisely what we're doing with our government. We're enabling.

And our government, true to form, has become addicted to spending.

And if you were to just take a moment, if you haven't suffered from a migraine headache in a while, just take a moment and really, truly document.

All of the taxes that you pay in every element of your life.

And if the government had.

One eighth of the creativity.

In reducing spending as they do in developing new revenue generating.

Methods of taxation, this country would be so prosperous and so abundant.

That we wouldn't even be having this discussion right now. What infuriates me is that it just keeps happening over and over and over again. And we sit there and take it.

We've got the woke culture, the cancel culture, all these balloon heads that are so far out of whack psychologically, let alone in their thinking.

Sit down, go to Canada's Main Street. Sit down with a hard working blue collar family who work their asses off to put food on the table, keep the lights on, keep the furnace on, get their kids to school, to sporting activities, and they want to live a fruitful, abundant life. Tax after tax after tax after tax. Your heating bill goes up, your lighting bill goes up, your food bill goes up. Inflation.

And inflation was manufactured.

Make no mistake about it. And the rich will get richer and the middle class will be taxed significantly. And so it's really easy for.

Government pundits to stand out there and point the finger at the wealthy. Let's focus on that. But nobody says, wait a second, the wealthy pay the most tax in this country. So has anybody thought about maybe reducing spending? If you even brought that up in a cabinet meeting? Regardless of your political leanings, I don't care what it is. Liberal, conservative, Green Party, doesn't matter to me. Bring up spending cuts in a cabinet meeting behind closed doors, not in front of the media, just behind closed doors.

You'll be finding something else to do in a real hurry because now you're putting public sector jobs at risk. You're going to piss off the unions, you're going to piss off a lot of people because you want to reduce spending.

It's absolutely Ludicrous. What's going on out there and the thinking that predominates and what's happening in this great country of ours to so many hard working families who are being penalized because they're right, wrong or indifferent. Hey look, I'm guilty as charged too. We're all enabling this to happen. And these governments don't care about the.

Keynesians, Jason, they're going to piss off the Keynesians too.

They. Oh gosh. And you know, they'll spend all their time in the House of Commons commons launching insults at each other back and forth and talking about how they need to create new committee after new committee after new committee after new committee. Nobody's leading, nobody's standing up and truly speaking for the people. It's all about winning. It's winning the political argument, it's winning the political agenda. It's not about really advocating for the hard working Canadian family. It has nothing to do with that.

And I just think it's absurd. And this study, they should find the nearest shredder and put it in there as fast as possible and use it as fire kindling because it does not stop there. There are extensive studies going on that we're spending. Canadians are allowing the government to, to spend millions and millions of dollars studying the feasibility of taxing you on your home equity.

You earn an income and the government trusts you so much that they allow your employer to deposit your whole paycheck into your bank account. Not a chance. Taxes are withheld. You pay tax in every facet of your life.

You use after tax money to pay your mortgage.

And now the government is studying the feasibility of taxing the equity accumulation in your home. And if your home's valued at more than a million, this absurd report is talking about a surcharge of 2%. Oh, we're going to cap it at 2%. Bullshit.

The moment you get the 2, then there's going to be a necessity for 2 and a half, then a necessity for 3, then a necessity for 4 and so on.

Well, you just have to remember the origination of income tax in Canada was started in the war. It's a wartime tax to beginning at the first World War. And it was temporary and they said it started here and it would only go so high. Well, now it's fully embedded into marginal tax rates and implemented in every faucet. Tax code has gone from this all the way to this. And that was all based on the guise of temporary. So you give them an inch, they take a mile. You give them an inch, they take A mile. It's unreasonable to think that if they implemented something of this structure that they won't modify because once they have it in place that you can't stop them.

Right.

And further to the point, here's the thing. A million dollar house in Canada is completely the country. It's like the, I don't know, it's the second largest country or third largest landmass in the whole world. Like it's a, it's a big be. And we might not have the largest population based on land mass, but there's a lot of people here. And a house for a million dollars is a lot of different things. If you're out in, somewhere in the Northwest Territories, boy, I bet you that gets you an awful lot of land and a lot of property. But if you're in downtown Toronto, you might have a box, you might have a closet for a million dollars. If you're in downtown Vancouver, you've got a closet. In Vancouver you can't even get a, you can't even get a, you know, a two, three bedroom townhouse for $1 million. In fact, in Chilliwack, where I'm, which is 90 minutes from Vancouver, you know, a three, four bedroom house is going for over $1 million here, depending on, you know, where it's located and the bells and whistles that are in it.

You know, and Rich, I'll share. Let me expand on that one point that you just made. I had a prospective client that I met with who purchased real estate in the mid-1950s. Four properties, purchase price $30,000 a unit. Those units are valued at more than a million today. But him and his spouse just happened to be in their early 80s.

And you can probably imagine they're not exactly swimming in income. And you want to charge a surtax because of the value of the property on top of the property taxes that are being paid already.

Plus when he goes to sell, which will have to happen because that gentleman, his time remaining on planet Earth has a finite span to it. And the day that he walks out, CRA is going to walk in and they're going to say, by the way, you paid 30 grand for these and they're now worth 1.2 million. Guess what the capital gain on that is, you know, is a lot, whatever, it's a million plus dollars. We're going to tax you as income on 50% of that. And if it's four properties, then that's going to increase his total income. On his final estate bill, he's going to pay the Biggest tax bill that's most people will ever see in the whole life. And all that money that he want, that he built and set aside to try to leave for his family is going to be obliterated just because he's going to die and the tax has to be paid. So he's already going to be paying a massive amount of tax. Now on top of that, you want him to pay it while he's alive just for owning something because he had the good sense to buy that property 60 years ago. That's absolutely insane and ludicrous. It's a penalty. Directly on the back of the hard working container, there's hardworking Canadian. There's no doubt about it. You might as well strap on a giant boulder that you're going to carry around just because you bought a property. Now here's another thing. There's hardworking Canadians today that just to get into the home market, yes, it's a difficulty for affordability which is primarily caused by manufacturing and manipulating interest rates, which we'll get to in a second. But.

When you're in your mid-30s or whatever, early-40s, you're buying a house for your family right now, and you're in the greater Toronto area, let's say, as an example, and you're paying a million dollars for that home right now, it's a starter home. It's not a, it's a, it probably needs work, it needs renovations. In order to do those renovations, you're going to have to go pay a contractor, you have to go to Home Depot, you got to buy materials and supplies which is churning the economy. Okay, for that, that home ownership. There's things that you need as a homeowner that churns back into the rest of the economy. Now if you, you now have to also start paying tax. You just barely were able to qualify to get it just to get the roof that you wanted to have the dream of ownership. You were finally able to squeak through and get it. Now your whole plan of affordability just to be able to make that reality happen had no bearing on now paying a tax on top of that number. You institute that. And then also we see an increase in interest rates which is anticipated in versus Q1 of 2022 over. While we're recording this video, there's anticipation of interest rate increases by the bank of Canada. That's going to squeeze affordability, which is going to push hardworking Canadians into foreclosure, which is then going to create a potential precipitous drop in real estate prices. If you see a mass amount of foreclosures across the board, we've seen this happen before under rising interest rate environment in the early 80s. History has a way of repeating itself. Do you want to put the nail in the coffin? You want the bank of Canada put the nail in the coffin or do you want the tax to put the nail in the coffin? Or both?

You know, I'm in business, I'm a multiplier, but I think in practicality I'm a simplifier. So here it goes. Now this is going to strike anybody.

Who's in government advocating for more spending programs.

Spend less.

Than what you bring in.

There's a shocker.

Reduce spending if you're spending too much. There's another shocker.

Leave more money in the wallets and purses of hardworking Canadians who have a far better idea of how to spend it.

Than any government bureaucrat ever will. There's another shocker.

If you reference Nelson's book. He describes a phenomenon. He says, I want you to picture for a moment that you're sitting in a food court of a busy shopping mall.

And you're enjoying your lunch.

And wouldn't you know it, right next to you.

A person walks up to the folks sitting at the table and points a gun right at the head of one of the people sitting at that table and says, I want you to empty the contents of your wallet right now or I'm going to blow your brains out. Everyone in the food court's witnessing what's going on. That is a criminal offense.

However, if that gun touting robber had gotten everyone else together in the food court long before the victim showed up and said, listen, I want you to know what I'm going to do. I'm going to have this guy empty the contents of his wallet, but I'm going to distribute it to everybody who's here. So just humor me, play along. You're going to get some money. Hopefully he's got some in his wallet if we haven't taxed them enough yet.

Gun holder points the weapon at the victim, says, empty the contents of your wallet. Now everyone in the food court's perspective has changed. That's called democracy in action. And the guy sitting down enjoying the meal had all the fingers pointed at him. You're the wealthy one, you're the villain.

But nobody in the food court said, wait a second, Mr. Robert.

What problem are we really trying to solve? Because Nelson taught us that if you don't understand the problem, the solution just won't matter. So have we really pinpointed the problem. Canadians coast to coast recognize what the problem is. Nobody in government's listening, let alone doing anything about it.

Because it's all predicated upon agenda. You got to protect the party, you got to protect the agenda at all costs, even if it means sacrificing your own beliefs, your own values and your own logic, your own brain power. This is not a difficult problem to solve.

But nobody has the guts to actually do it. And the lobby alone in government would crush you. We've given too much power to the.

Very people who are there.

Way too much power. And I'm afraid there's no turning back.

Well, as a member of kalu, Jason, you've been involved in seeing the impact of some of that lobbying in meetings that you've gone and stuff like that. And, and it is really robust. And now I want to segue that into. Just as we look to kind of close this little video here to get people thinking about a couple of things. So number one, if this type of an article, the thing that we're talking about bothers you, I think it should you make your own decision, your own opinion. But I think it should bother you. And if it does, how are you creating some.

Secession of the system for your own needs? So Nelson talks about becoming your own banker as the most peaceful, stress free way of financial life. And it's really a way of peaceful secession. Nelson said you can't make change at the top kind of government level monetary policy with top down thinking. The only way you could do it was with a bottom up solution, IBC infinite banking concept. And implementing that concept of becoming your own banker through the mechanism, the medium of mutual whole life insurance which is mutually owned by individual people, involuntary free contract, it's voluntary free contract with one another. No one puts a gun to your head to get into that whole life contract. You mutually profit and share in things together. It's kind of like a co op and it's a private contract. The government doesn't know you have that private insurance contract and they don't need to know. And there's a ton of tax benefits that can be accumulated especially for business owners if you know what to do and you have the right coach in place. And so what are you doing to take action about seceding from a system that's not set up to benefit you? Seceding from a system that is at every turn finding ways to further oppress your good hardworking efforts to produce what you need for your family so that you can have peace of mind. Comfort, enjoyable lifestyle, and hopefully at some future point, if you like the word retirement, I don't. But a passive income that lets you enjoy the life that you want later on. And also when you kick the bucket, when your biggest tax bill ever shows up, rather than just having all the money disappear and your spouse being surprised at how much is gone, a big fat chunk of tax free money that the government can't get their hands on shows up and it solves a whole bunch of problems. You know, it reminds me of what Bob Scheel says, one of our mentors. He says everyone should die for a week and experience what it's like and the problems they leave behind to really understand what's going to take place. Just imagine that if you died for a week, what's going to happen with everyone around you. And if you really thought about how you could solve that problem and the tax problem that comes up with it, there's only one thing that comes up that can really do the job. It's called insurance. And it's got to be in place when you're dead, which is called whole life insurance.

There you have it. Okay, I think we've got a lot of things off our chest for this episode. We may want to rename the podcast to Wealth Without Government. And ultimately, at the end of the.

Day, if we had that, we probably wouldn't need a podcast. Totally.

So less, less government, more money in your pocket. You know how to spend it. You'll spur the economy. Because, you know, we, we're not again what the government believes, you know, most Canadians are.

And that's, you know, ignorant. Hey, listen, if we just, if we implement the death by a thousand cuts approach, sooner or later, by the time they really truly realize what's going on, A, there's no infusion and B, they've just bled out.

And you've heard the expression, you've heard us say this before. There's two certainties, death and taxes. The only thing that doesn't get worse every time politicians meet is death.

And so don't sit there and take it. We're not, we're going to be communicating on these issues. We're going to be talking about these issues. And this is not about any political leaning. I don't care what party you believe in, espouse to. That doesn't matter to me. This is pure logic.

You're already spending half of your year working to pay taxes. I want you to stop and think about that for a second. Half of your year goes bye bye to paying taxes. How long do you want that to continue and how much worse do you want it to get? Logic would tell you you don't want that to continue and you don't want it to get any worse.

Do something about it. Let your political figure, your mp, let your political figures know that this is just no longer acceptable. Appreciate you tuning in.

The final thought I'm going to leave there, Jason, is that the consumer pays for everything.

Let's hop onto the stream yards.

You know, keep that in mind. Okay, everybody, we'll see you on the next show.

All right, thanks for tuning in. Now, the playlist is going to be right there or right there on either side. So continue your journey of learning. We appreciate you very much. Make the rest of your week great and stop putting up with onerous taxation because believe me, this death by a thousand cuts, they're up to about 600, so let's not let them get anywhere near a thousand. All right, everybody, bye for now.

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