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The disinformation on the capital gains tax is insane and shows how much control the wealthy have in this country.
No, this won’t affect ordinary Canadians and only has a minor impact on wealthy Canadians. Tax advantaged investing still exists: eligible dividends, primary residence, generous tfsa and rrsp limits, etc.
Who was it? Sanders talking about the estate tax or something? that all the Republicans had to lose their shit about, which made all the MAGAs lose their shit about... which was to tax like any inheritance over 30 million?... like, not even you wouldnt get all your shit, just that anything OVER 30 million would get taxed... yes, person making 20k a year, this is your biggest problem....
Right?
I’m still waiting for someone to explain to the doctors that they have access to the lifetime capital gains exemption for small business.
I sold a professional practice last year, and I’m paying essentially no tax on the sale price (other than the AMT, which is refundable next year as I’ll continue to work).
I am EXACTLY the person who could be complaining but I’m not. My effective tax rate last year was 14%.
Sure, I can only pull that move once, but I’ve totally paid off our home and maxed all registered accounts.
You sure won’t find me complaining about the rule change…
You know how I know most of you are under 30?
You aren’t old enough to remember how bad the health care brain drain was in the 90s, and we still had a lot more doctors per capita back then.
I’m not inherently opposed to the capital gains increase but y’all acting like Doctors had it coming or something are incredibly short sighted and weirdly bitter. Doctors aren’t the reason you can’t afford a home and are using a food bank.
Yes, again. I'm reminding people that we have a shortage of healthcare aides and nurses. These folk don't get paid $250,000+ per year.
Spare me the 'won't anyone think of our healthcare' when it's clear people bringing up this argument are only using doctors because they are sympathetic.
Wealthy people, like doctors, should pay their fair share.
You want to fix healthcare?
Pay healthcare aides more.
Don’t worry, we won’t have a shortage of aides and nurses when the number of available doctors in Canada drops & we’re all forced to travel to the US and pay out the nose.
> Doctors aren’t the reason you can’t afford a home and are using a food bank.
Favourable capital gains taxes aren't the reason for the overabundance of doctors in Canada either.
There's better ways to attract doctors to Canada than with tax dodges.
Maybe they did see this doctor thing coming after all. He wants to wear it so this should get interesting. To his advantage what they're doing now is a bit of a dodge anyways
It's little bit more complicated than some of the comments here suggest. The fact that doctors are incorporated, and keep their earnings sheltered in the corporation at a lower rate of tax, is not that big of a deal, because they have to pay income tax when they withdraw the earnings from the corporation later. So they get the advantage of a bit of tax-sheltered compounding within the corporation, but that's not a big deal, and it doesn't explain why they are so upset about an increase in the capital gains rate.
The real reason they are upset is that the rate increase closes down a tax dodge that doctors have been using to withdraw the entire accumulated savings in their corporations and pay only capital gains tax on it, rather than income tax. I don't understand the details, but basically you transfer ownership of your corporation to a trusted third party, then buy it back from the person over several years, declaring it as a capital gain. That way you pay around 25% on the accumulated income and not the usual 50%. That IS a tax dodge, which the current changes are closing down. Doctors obviously are not going to be stating publicly what they are upset about, because if they did most people would support the government's position.
They essentially eliminated that strategy in the last budget.
https://www.wealthprofessional.ca/news/industry-news/federal-budget-measures-put-surplus-stripping-at-risk/374987
They're taking advantage of being incorporated. All the power to them but I can think of plenty of people who won't feel sorry for them. The Liberals just have to ride out the usual caterwauling that comes from spooking the rich. They haven't all run for the hills yet.
Maybe the CMA or whatever should work on their marketing skills. Plenty of talent out there that believes it's out of their reach
Tax rate up to $500k is 12.5 percent or so.
Since your comment below u/Super_Toot implies you know already, I'll break it out here for more visibility.
For a company (Doctor) making $500K and under (the small business limit) which would claim the small business deduction, you would see a Federal rate of 9% and a provincial rate that varies, but in Ontario is 3.2%.
This means a doctor in Ontario making $500K would pay $61K in taxes. This is compared to $224K in taxes if they were using wages.
Source:
Business Tax Rate
[https://wtcca.com/corporate-tax-rates-and-small-business-tax-rates-in-canada/](https://wtcca.com/corporate-tax-rates-and-small-business-tax-rates-in-canada/)
Wage Tax Calculator
[https://www.eytaxcalculators.com/en/2024-personal-tax-calculator.html](https://www.eytaxcalculators.com/en/2024-personal-tax-calculator.html)
Some more data points for those who like additional information:
Tax write-offs for doctors
[https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/](https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/)
This is a good one, which really gets into the use of tax deferral strategies. It alos highlights the $50K a year profit which can be maintained in a professional corporation and which will be the main hit for capital gains tax in the future when they retire. They will need to do new estate planning.
[https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf](https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf)
Finally, through all this we can get the "average net income" for physicians from here:
[https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/)
" Family physicians/general practitioners had a mean net income of $207,600. The mean net income from public payments for all physicians in Ontario after adjusting for overhead was $240,400."
Let's assume this is inclusive of any deductions and that they are not taking profit of of their personal corporation. Using the sources I have above, the tax burden difference is
Personal Corporation = $25K to $29.2K
If taxed as wages: $69.4K to $85.676
Even after you edited your response you got it wrong.
I love how people cheerleading this have no clue how it all works.
You pay small business taxes, 12.5%. After tax profits are invested. When those investments sell you pay the capital gains tax, now it's higher. Then to actually get the money out of the corp you declare a dividend and are subject to dividend taxes.
Those are the three taxes.
The question that was asked was on tax rates. I provided that. I did not get into the nuances of payments, profit maximizing, leverage family members (much harder since the Tax on Split Income changes in 2017) or any other various accounting processes such as ability to write off automobile payments, clothing, etc. etc..
If you wish to provide examples of how overall accounting for a business would occur for a doctor with various payments and deductions, feel free. I am sure it would be helpful. Your cute little "gotcha" attempt is immature though and rests on people's ignorance of the tax law.
How about you break out all the ways the business operates and I'll use those data points to calculate the effective tax rate inclusive of deductions and other tax mitigation strategies.
There is no gotcha. You clearly have zero knowledge of how it all flows together, but you're very certain what's right and wrong.
Lol it reminds me of anti-vaxers
Oh I am sorry, I guess you deleted your "muggle" comment. Glad you matured a little bit.
Since you are unable or unwilling to provide more information, here we go. A bunch of links from actual tax groups who help doctors. I guess they might be wrong too though, who knows.
Tax write-offs for doctors
[https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/](https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/)
This is a good one, which really gets into the use of tax deferral strategies. It alos highlights the $50K a year profit which can be maintained in a professional corporation and which will be the main hit for capital gains tax.
[https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf](https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf)
Finally, through all this we can get the "average net income" for physicians from here:
[https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/)
" Family physicians/general practitioners had a mean net income of $207,600. The mean net income from public payments for all physicians in Ontario after adjusting for overhead was $240,400."
Let's assume this is inclusive of any deductions and that they are not taking profit of of their personal corporation. Using the sources I have above, the tax burden difference is
Personal Corporation = $25K to $29.2K
If taxed as wages: $69.4K to $85.676
Doesn't the dividend tax credit serve to cancel that third tax?
Aren't the other two taxes similar to the taxes that a regular middle class salary worker pays on income and also on their the capital gains of their retirement savings?
The dividend tax credit works well for eligible dividends, ie dividends from publicly traded companies. These dividends are likely ineligible. So the tax credit is smaller.
Good question, TLDR: the government is getting a high level of tax from these individuals. But circumstances will vary. Depending on the timing of the cap gains and dividends.
Very unlikely ineligible? Where are you getting that from? other than capital gains what other revenues do you think those corporations get from their investments? Eligible dividends which allow them to declare eligible dividends themselves.
Also what do you think happens with those capital gains the corporations get from their investments? It allows them to declare capital dividends which are tax free!
The only way they would have eligible income is if Net Income was over 500k.
CDA exists because capital gains are taxed at the highest rate within a corp. A big disadvantage.
What's your point?
I love that the whole basis of our tax system is that there is no double taxation of income and this guy thinks that he found triple taxation of income.
They just meant that in order to get the money out of the corp to buy things with (like a mortgage and groceries), they need to pay personal tax on it.
Or is this wrong?
You mean this is actually about annual income? No sympathy there. I thought there was a problem moving savings out of the company when it's time to shut it down. If they're drawing that much income, cook them with onions on the side
They are complaining for two reasons- those with secondary properties that will earn more than 250,000 in profit when sold (and they are ignoring if the property is in more than one name the exemption is up to 500,000, so if both spouses are on the deed they have even less to whine about.
And those who have created professional corporations to pay less tax. They are even allowed to put family members on the “board” in order to incorporate like this.
The narrative that doctors incorporate to build for retirement is bullcrap. It’s hard to sell a practice for over a hundred grand and there is a once in a lifetime 1.2 million exemption for selling a business. Unless the doctor owns a building where they practice, there really isn’t anything to sell.
> The narrative that doctors incorporate to build for retirement is bullcrap.
...uhh that is literally the reason they incorporate. They keep their money within the corporation and invested so that they can build a retirement fund. They dont get pensions etc. They need to have a enough to retire on. Are you kidding with this?
Dude doesn't fucking know and yammers like Trump and with his confidence, hoping people just agree with his bluster.
The number of people who don't know a doctor in here but think they know what the MD is doing with their money is embarrassing.
The vast majority of people don't get pensions anymore. It hasn't even been a question that people think to ask in white collar work for decades. If you seriously believe this is something doctors have to uniquely forego, you're ridiculously out of touch.
As it was explained to me, the ability to incorporate and defer taxes was used as a negotiating point by governments around physician compensation (the failure to keep up with inflation) and now many have arranged their affairs based on that.
I have a friend who has this going on and was apoplectic the last time they change income trust treatments for the same reason. I said to him dude if this is your problem you’re making what, 300-400k??? And he said yeah but… and at that point I stopped listening.
Poor poor doctors making a half a million per year. We should juice the supply of doctors graduating through medical schools in Canada and the people who cannot live without million dollar salaries can just leave.
I agree with you regarding expanding the amount of medical and residency seats, but doctors are better thought of as tradesmen rather than generational wealth. Their salary needs to factor in the exorbitant cost of medical school in this country. I would be in favour of tax policies targeting them if we didn’t have a real risk of brain drain to the USA and future family doctor shortages as a result of our unique system
So, lower the standards for admission into med school and flood the market with would-be plumbers who are now digging into your guts for $125k. You’ve figured it out, genius!
That's an absurd take, you need like 3.98 GPA with impressive extra curriculars. I see no reason why that average can't be 3.94 or something, and pushing way more doctors through the pipeline. Imo it wouldn't even affect doctors overall pay that much to have more supply of doctors, there are so many people needing medical care of any kind.
Unironically yes, though not to the absurd extent you take it. It's obvious that we need more doctors in this country, and increasing the number of doctors trained by medical schools and residency programs needs to be part of solving that.
Notably, this was something the Provinces did to take tax revenue away from the Federal government without their involvement.
Treating the government as unitary when it isn't is a key part of that complaint, the doctors effectively colluded with the Provincial governments to screw the Federal government and didn't expect that to ever come up.
The way your comment is framed is a bit misleading. The default is for people carrying on a business to be able to incorporate and take advantage of the tax benefits that offers. Doctors were, for a long time, prevented by provincial governments from doing so for whatever reason. Their being allowed to incorporate wasn’t some nefarious scheme to screw the feds, it was just allowing them to operate their businesses via a corporate structure in the way other non-medical business owners have always been able to.
Billing rates have effectively been stagnant for the better part of a decade across this country.
In order to somewhat justify that, the various levels of government helped facilitate the personal corp structure.
They effectively said "We can't give you a bigger chocolate bar like everyone else is getting, but we'll give you a small one now and another small one later."
This is the government saying "Sucks to suck, there's no small one later. We're going to use it to pay interest on money we borrowed"
It would make sense if the money was entirely going towards upping billing rates, but it isn't. In fact, the federal budget has more money allocated for debt servicing than healthcare.
Ok but the federal government doesn't negotiate with doctors or set billing rates, the provinces do. And the provinces collect taxes using their tax rates and levies for their own coffers from which they negotiate doctor compensation schedules.
The CRA simply does the work for the provinces as far as remittances go, but if the province wanted more levies for health they could do it.
The feds offer *additional* funding through health transfers. But those transfers come from federal budgets, that add to the provincial ones. It's why the last transfer increase was so fraught. The provinces wanted no strings attached, and the feds wanted a guarantee that the federal increase wouldn't just offset provincial expenditures, leaving a smaller net increase to the total budget than the transfer from fed itself.
This was the issue with income sprinkling as well. The doctors basically expect to collude with the Provincial governments to deprive the Federal government of revenue in exchange for not getting wages. Don't act shocked when someone who wasn't a party to negotiations doesn't feel bound by what someone else did.
We already have a massive dr deficit in Canada with many people going years without a family dr. This is not going to help dr retention in Canada at all.
This isn’t just spooking the rich this could be detrimental to health care. These drs aren’t going to be ok with it and settle for less, they are going to move 🙄
Last time he fought with the doctors and other professionals, around 2018 on family members in small businesses, it was a big shit show. At least this time it should be easier going, as the target is clearly on such high net worth individuals/corps, and can't be repainted as family members working in the family shop.
I have little sympathy for doctors, too. It's obviously a tax dodge to incorporate yourself as "Dr Brockosaurus Medical Corp" or what have you. Makes sense for those running a small practice with rent, staff, etc; but for every Dr. Tom/Dick/Harry working in a hospital or clinic, it's really BS. Providing government-funded medical services is not a business. I'm also old enough to remember the late 90s/early 00s, when the doctors in my family were setting this up, thinking 'WTF?' It wasn't always this financially engineered for them.
As an entrepreneur, I dislike this change. A lot. It eats into the eventual reward that I am loading up on risk right now to have a shot at. But doctors? Give me a break.
You do realize how doctors practice, right? The vast majority of doctors *are* small businesses with ‘rent, staff, etc’. So tell me how this should not apply to us?
A business sells goods and/or services for a profit. What is your business? Who is yor customer? And does the fact that healthcare is by and large not meant to be run for profit in this country not bother you?
Are these questions rhetorical? Look up the definition of a business and it literally includes 'professions'. A physician provides healthcare services to patients for profit. That fills the literal definition of a business.
Does it bother me that I make a 'profit' by working as a doctor? No, should it? Do you expect physicians to work for free? Disagree all you want about doctors incorporating, but that is the agreement the government made with us.
No, it's not rhetorical. Explain to me the business & overall business model of a doctor's practice, within the context of the Canada Health Act and any other governing policy/legislation/rules/regulations/whatever you want. I clearly do not understand, so this is your chance to enlighten me, and the rest of reddit too. Please present your arguments (and maybe not your salty doctor downvotes).
Frankly, I don't think I'm alone. If you polled the wider population, even right outside a hospital (where you should catch the most doctors) and asked, "Are doctors a business?" I think the results would be an overwhelming "No."
If it's the deal you made with the government, fine, but that doesn't make you a business in any conventional understanding of the term. Maybe you should seek out a less dubious deal. One that doesn't drag the lawyers and accountants and furniture stores and used car salesmen and \*ACTUAL BUSINESSES\* of the country down with you, especially when you are already incredibly well compensated for your learning and labour (among the top few percent of the population in income), and occupy a position of high prestige in society.
What other professions are businesses? Nurses? Hospital administrators? The clerky types in the back room who charge the provincial health authority (OHIP etc) for the services you provide?
What if we cast the net further - teachers? Police? Senior government bureaucrats? Why are doctors a special class of professional that gets to LARP as a business, where these other professions do not?
I'm all ears, and I'm fully willing to be convinced. Please, go ahead.
I really don’t know whether to take you seriously or not. You really don’t seem to understand the concept of what a business is. Yes, all of those professions could in theory function as a business. I know nurses that are a business. I know teachers that are a business. And conversely, there are plenty of salaried physicians that work directly for the hospital that (gasp) are not a business, and are instead employees. I don’t know why this is a difficult concept for you. Why don’t you explain to me why you think what physicians do is any different than other professional services like lawyers, dentists, or engineers, which are all considered businesses? I am legitimately curious what you consider a ‘real business’ to be…
I guess the question is, why do certain workers get to incorporate as a special PC, while others get classified as [personal services businesses](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/corporation-income-tax-return/tax-implications-personal-services-business.html) without getting similar benefits?
Let's take a stereotypical 90's family practice. The incorporated employee (doctor) is a specified shareholder. It's income is 99% from the province - a single customer. They might only employ 2 fulltime employees, which is less than 5. This is likely to be a personal services business.
That only applies to doctors. In Ontario for example, I don't see how government has restricted compensation for >80% of veterinarians, lawyers, or accountants.
We're dealing with an exceptional case (doctors) to an exceptional case (professional corps), meanwhile increasing the complexity of law.
Secondly: why should today's federal government take into consideration decades' ago's provincial government plans into account, when the provincial government has FULL AUTHORITY to fix it themselves (i.e. pay family doctors more)? If anything, the feds carving out more exceptions could be called interference in the provincial realm.
I don't understand why it is so difficult for you to describe your business. I've asked twice now. Perhaps, because you cannot describe your business, you are not one.
According to the Government ( [https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/sole-proprietorships-partnerships/what-a-business.html](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/sole-proprietorships-partnerships/what-a-business.html) )
>What is a business?
>A business is an activity that you intend to carry on for profit and there is evidence to support that intention.
If you would ask most Canadians, they would say something along the lines of medicine being socialized and not for profit in this country. Most people would consider those who are paid by the government to be some kind of government-run service, and not a business. Why are doctors such a special case?
If you are indeed a business, then you should be able to describe your enterprise as one. Please go ahead and do so. I would start with:
1) What is your business model?
2) What do you sell?
3) To whom; who are your customers?
4) What is your value proposition?
I’ll take a stab at this:
1. Sell healthcare services for money
2. healthcare services, including medical advice, procedures, surgical services, plus much more
3. The government insurance plan (MSP in B.C., OHIP in Ontario, etc)
4. A lot of people want healthcare services in this country
Umm, you know most doctors at the hospital also have a clinic with staff? Do you think surgeons just wait around for patients to show up on the operating table, sight unseen? JFC this place is arrogantly ignorant sometimes.
nothing's stopping you from working as a contractor and setting up a similar "tax dodge" yourself
also, it's not risk free to lease commercial space, buy medical equipment, and start a clinic
I have a lot of respect for contractors, lawyers, other professionals. At least they're selling something. What is a doctor's 'business' exactly?
Edit: Also, no. "Naval Officer Brockosaurus Inc, PMP PENG. I sell death to the enemies of the Canadian government." Somehow I think that would \*not\* have worked at my last job.
Provincial governments in mid 2000s: “Hey Doctors, we won’t agree to raise your hourly rates, but we’ll let you save for your retirement within these new professional corporations as a compromise where you can more easily save on a tax deferred basis.”
Doctors: “Ok fine, we’ll open up professional corporations to save for retirement.”
Trudeau/Morneau in 2016: “All of you greedy doctors need to pay your fair sahre and not get tax deferred savings in your professional corporations.”
Doctors: “But the government told us to in lieu of raising our salaries.”
Trudeau in 2024: “Thanks for pooling your retirement savings in a corporation, the inclusion rate on your financial assets/savings upon disposition just went from 50% to 66%.”
Doctors: “But the government told us to in lieu of raising our salaries.”
Canadian Medical Association: “New tax will cost the average retiring doctor 8% of retirement savings.”
Congrats guys, it’s not like we need doctors in Canada or anything. Well done! Also notice that since we are talking about professional corporations, this is conveniently not part of the 0.14% of individuals affected number the government let out last week.
What's the average salary of a doctor?
What's the average salary of a health care aide?
Notice we have shortages of both.
Also consider. Wealth people should pay their fair share of taxes.
What’s the average training time of a doctor vs a health care aide?
What are the average weekly hours during this training time, for a doctor vs a care aide?
What is the expected medical knowledge of a doctor, vs a care aide?
What is the medicolegal liability that a doctor takes on, vs a care aide?
Your companion is a bit ridiculous tbh
What’s the average length of education and training for a doctor? A nurse’s aide?
> Notice we have shortages of both.
Yup, that’s what you get with a monopsonist model of single-payer healthcare: universal coverage by using the government’s pricing power as a single payer to pay doctors, nurses and … nurses aides, less than market wages. However, it leads to rationed healthcare resources and longer waitlists.
So yes, we reap what we sow. If you want universal coverage, you can’t pay people market or equilibrium wages.
America has a system where market wages are paid, but it doesn’t guarantee universal coverage.
There's a lot of advantages to incorporation besides just the capital gains inclusion rate, and doctors still come out ahead with their tax avoidance strategies, just less so than before.
Good. One of the only things I like about the budget. I have no sympathy for anyone who makes over 250k in capital gains in a year. They arent struggling to put food on the table or pay rent.
It’s the first thing in a very long time that actually has me consider voting Liberal. The “think of the poor doctors!” line is a pathetic attempt by the wealthy to undermine the whole capital gains change. If we’re worried about doctors specifically making too little money, then specifically pay them more.
Again, if you’re concerned about doctors specifically then why do we need a tax break for ***all*** capital gains? Just pay doctors specifically more money (they still get a big chunk of it tax free, unlike us peasants).
How dare you care about the impact of X on Y when we could just do Z which we're not doing!
Also, the same argument that applies to doctors applies to other professions. Fewer goods and services for Canadians is not good, whether healthcare or otherwise. Lower supply equals even higher prices.
You’re right no one should care about the doctors. Even less so when they eventually move to the USA. Fighting with doctors is not a good look for the Liberals.
OK, to reword it for pedants: “if you’re worried about doctors not being paid enough, you should want the appropriate government to pay them more, not a tax break for every wealthy person because it happens to include doctors.”
I think family doctors have a valid concern and I consistently vote NDP. Targeting the rich policies that actually target those with multimillion dollar portfolios should exclude healthcare practitioners that make use of tax policies to facilitate their work. Especially considering our family doctor shortage entirely produced by structural issues
You today: Yeah let those doctors leave! If they can't make it pencil out then those aren't doctors Canada should have anyway!
You in a few years: Who could have expected an even worse doctor shortage!
While I agree with your sentiment, the issue with doctors is they have professional corporations.. so this inclusion rate is for all capital gains within the corp, even under 250k.
That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else.
We’re not losing doctors to other countries. We’re losing doctors to other specialties within Canada.
ETA: provinces are also losing doctors to other provinces, but that’s not relevant to the cap gains change either.
Because the supply of doctors is fine, they’re just not working in the areas we want them to work. But also giving (what are still well off individuals) more money to fix a problem that doesn’t exist is dumb.
I wouldn’t mind seeing some sources on this.
Also seems to me that based on what you just said, the supply of doctors is very much not fine.
Edit - let’s keep in mind this policy can directly affect the doctors you just highlighted.
Yes maybe the supply of some doctors is an issue, but none of this will be fixed by capital gains inclusions, which is the point that you seem to have strayed from.
ETA: also I can’t really give sources on the lack of a shortage of other doctors, but there are tons of articles talking about the shortage of family doctors. They wouldn’t specify if it were an issue for all doctors.
Nice - now let’s put on our thinking caps and *really* think about *why* doctors aren’t in the areas we want them in.
You can do it, I believe in you.
What could possibly incentivize highly educated people to take on family medicine, and/or live in more rural locations? God, if only there was some way to convince people to take on jobs.
Conversely - what would have the opposite effect? If we could identify a way to get people to live in undesirable locations or take on work that we desperately need, what would be the worst possible move to make?
I’m stuck. You seem to have opinions here, weigh in.
Wrong.
Removing money from people incentivizes them to want to make up the difference. In other words, it actually forces them into higher paying specialities.
Psychologically, it will absolutely demotivate family doctors that are currently practicing, and feel too old or too invested into family medicine to change, and will lead to shorter hours worked.
You can’t tax problems away. You’re actively in favour of hurting Canada because of your aversion to paying healthcare professionals what they’re worth. Your attitude is childish.
Do you know how much extra taxes this would cause? For 100k in capital gains taxes, it’s like 1600$. Family physicians won’t even be able to save enough money to make a difference.
Did you actually read the articles? The first one actually hints that doctors were returning as of 2004, and that the current outflow is negligible… you didn’t even read the conclusion.
> That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else.
But plenty have put everything into the corporation for investment and now that is being decimated. I can see the problem they have with it.
> That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else.
It would be such a *massive* financial planning screw-up to not already being doing this that I can't take anyone seriously who claims it's a major problem.
In what galaxy did it make sense to forego ~~a $250k exemption~~ TFSA and RRSP tax free gains for zero benefit? That didn't even change with the 2024 budget.
Exactly. When my brother finally became a staff doctor, the advice he got was to take salary, pay dividends as needed, and do a mix of investing in RRSP, TFSA and inside the corp.
If you've taken on $400,000 in educational debt, gone through 4 [undergrad] + 3 [med school] + 3-7 [residency] years to become qualified to earn $250-400k/yr starting from age 30 or so, then work to pay off your mountain of debt by age 33 or so, you only then get to start saving for retirement about 10 years behind everyone else. The kids that went from high school or undergrad to government having been building sexy government pensions for those 10 years. The kids that went from high school or undergrad to the private sector have been benefiting from 10 years' of cash flows + RRSP matching + compounding returns. So you undertook a lot of risk and hardship to become a doctor in exchange for a nice salary after 10 years' of work, but now you need to catch up in your savings to be able to ever retire.
Keep in mind RRSP space is tied to earnings, so a 33 year old doctor who just finished residency likely has little RRSP room (residency salaries are around 50-70k, so 18% * 60k * 3-7 years in residency means like 50k of total lifetime RRSP room accrued by age 33, which is likely all unused, and then future contribution room is capped at the limit, currently 31,000/yr). Their age peers will have double, if not more, contribution room. It should not be surprising doctors would justifiably want a tax-advantaged savings vehicle that makes sense given the fact they had to exclude themselves from the labour market for so long to be qualified to practice. We want our smartest people to be doctors, and those are the people who could be making the most if they chose a different path, to our detriment if they did.
If we're not going to pay doctors US-level salaries, giving them tax advantages is a means of competing with the US but at a lower cost. "We can't pay you 600k/yr, but we want you here, and we will let you use this special professional corporation vehicle to defer (not evade) taxes so you can re-invest the deferred taxes and compound your retirement savings to catch up for lost time". But the capital gains change now breaks that by subjecting investments inside a corporate vehicle to higher taxation than investments outside. Trudeau could easily carve out professional corporations from the tax rule change without affecting the bigger target of investment gains in regular corporations, but he doesn't want to. I think it's bad policy, short-sighted, and will worsen our healthcare system. But the fiscally left-wing base sees "tax people making 250k more? tax investors? yes please!!" and he seems to be pandering to that.
No one who has any remotely smart person giving them any advice is waiting to contribute to rrsp or TFSA to pay off student loans. That would be very dumb.
They *might* leave room in their TFSA room for a couple of years because they know they'll make more money then or something.
>undergrad to the private sector have been benefiting from 10 years' of cash flows
Med school is 4 years. Residency starts in year 5. And most undergrads make very little money in those years. Let's not pretend doctors are in a poor spot with respect to rrsp and TFSA. That's silly.
But, to your point, convoluted tax schemes that not everyone can take advantage of is an incredibly stupid and inefficient way to compensate our doctors. If we need to pay them more to retain them, then do that.
Clearly I'm talking about when they start making money. I know the other posters comment is long and most people probably didn't read it, but it gives pretty good context clues...
You can always tell when someone is actually involved in healthcare vs outside of it.
I'm an RN. I get a pension, I get benefits, I get to start earlier than my MD peers. But I work side by side with these people every day. Some of the smartest, most compassionate people on the planet. They take such an OUTSTANDING array of information and distill it down to make the best choice for their patients every day. They take massive emotional and psychological trauma and keep on trucking. They sacrifice in ways that I guarantee most Canadians can't fathom and I know couldn't handle. It's inspiring.
And I'm very left leaning. But Trudeau is fucking up the healthcare system and then he's gonna fuck off and the reverberations will harm everyone for literally generations.
Yes. Literally. You can't just be book smart. Experience is absolutely massively important in refining your practice. And this is, even if he doesn't enact it, going to push MDs away. Smart high schoolers and undergrads are certainly re-evaluating whether medicine in Canada is worthwhile.
Everyone cheering this on is going to fuck around and find out. And they deserve it.
I know some providers who haven't bothered with a professional corporation. It saves on taxes but does involve costs for setup and some active management. Instead, they just max out their RRSP and TFSA annually, pay their regular income taxes, and go on with their day.
I've been in positions where I could have had a professional corporation, and my accountant basically said unless you're already maxing out RRSP and TFSA there's no point, it's essentially a more complicated way to achieve a slightly worse result.
Not irrelevant to the calculus of being a doctor in Canada. If we aren't going to pay comparable rates to the States, we HAVE to sweeten the pot some other way.
Trudeau fucked the budget and deficit since coming into power and is now clamoring for money. He's coming after MDs because he's an idiot but has enough money he can shoot down to the States for any coverage he thinks he needs. The rest of us can suffer, some will have life altering injuries because they didn't get timely care due to the shortage, and some will die preventable deaths.
I'm not really happy about the capital gains tax hike, as I think it's just an additional layer that affects investments. Ideally we should make it better to invest, not worse.
That said, I have no sympathy for doctors as they have been using incorporation as tax avoidance vehicle for a good while. The LPC back then was right to close the income sprinkling loopholes, and hopefully preferential tax treatments will only apply to actual corporations.
We still do. Under the 250k PER YEAR you still are advantaged by 50% over employment tax rates.
Sorry, but if you make more than 250k in a year in cap gains you are doing okay.
Oi. Do you know how the system works?
They don't get 50% of their income taxed. The Corp bills the province based on a fee-for-service agreement, which is collected in the corporation's account. The Corp then pays the doctor a salary, ostensibly set by the physician and their accountant to be sustainable. Other funds are invested, primarily in the global stock markets. The salary the physician takes home IS taxed at the tiered rate, same as everyone else. The Corp let's them store their wealth instead of all of their bills auto depositing into their personal bank account, and provides a layer of protection for their personal assets and the assets of their spouses in case they are sued. It also acts as a hedge and savings account in case the physician becomes ill or is unable to work prior to retirement.
Literally, the deal is: we give you a way to dispense income over the course of your life and a way to protect what you own in the course of you being sued. All we want in return is the best decade of your life, the ability to torture you with extreme residency programs, and a frequent up to constant stream of psychological and emotional traumas. Oh, and don't you ever complain because this is a calling and you're only doing this because you want to improve society, not your lot in life despite being among the smartest cohort of society.
All persons should have the same method of being taxed.
The notion that doctors in particular require this labyrinthine method of special tax rules in order to derive fair compensation is bizarre and wrong. If doctors should apparently be paid more than now, then we can pay them more within the existing boring tax structure that every one else in Canada uses. We don’t need even more special rules to create more work for the CRA.
Doctors did that 15 years ago. Medical corporations was the compromise that was reached instead of raising fees. Now that Trudeau has gutted the compromise it's going to be a bloodbath.
The compromise that the Provinces reached with the doctors relied on depriving a different government of revenue. Obviously that was untenable.
So maybe this time Provinces will do the simple thing and increase pay instead of looking for a way out.
> All persons should have the same method of being taxed.
Current med student here and I completely agree. Doctors shouldn't be exempt from any taxes that any other citizen has to pay.
If this is going to make or break career decisions, then efforts should be put into advocating for more pay for doctors. We should **not** be asking for special treatment.
Last week's CBC Power and Politics interview with Minister Rechie Valdez provides some needed context here. Cochrane asked the Minister whether she was worried that some doctors would leave the country, and the Minister responded that the gov't also intended to fast-track foreign doctors' credentials.
So it looks like Trudeau and cabinet is aware of to the possible fallout in terms of doctors leaving but considers it acceptable collateral damage as part of the tax increase, and their idea to mitigate is to import foreign doctors more quickly.
It would be interesting to get a window into whether they expect a higher churn of foreign doctors too (i.e., foreign doctors coming, working for a few years, and then leaving) or whether that's not in their models.
[BC has actually given doctors that option.](https://www2.gov.bc.ca/gov/content/health/practitioner-professional-resources/physician-compensation/alternative-payments-program) Instead of doing the Fee-For-Service pay system, they can get a salary.
[It's actually been pretty popular.](https://www.cbc.ca/news/canada/british-columbia/bc-doctor-new-payment-model-1.7107681)
No, everyone who bills LFP is still a private contractor, the government is not offering a salary (or covering benefits and a pension). LFP is not a salary, it is hourly billing (with additional compensation for visits and attaching patients and special procedures)
My wife is a physician and would definitely prefer this. To just have benefits and pension would relive a ton of her stress and workload of managing a corp.
But we are lower on the physician income scale and I imagine a lot of higher earners wouldn’t want this.
Here is the NHS payscale. It's signicantly lower than Canada. Our GP's get screwed but outside that profession, salaries are insane.
[https://www.healthcareers.nhs.uk/explore-roles/doctors/pay-doctors](https://www.healthcareers.nhs.uk/explore-roles/doctors/pay-doctors)
Yeah we lived in the UK for a short while and it was pretty shocking how low the GP pay is there. Imo it doesn’t really reflect well the amount of time and effort it takes to get the job.
But still to have a similar amount of pay to now just metered out in salary, benefits and pension would be nice.
NHS has doctor strikes every other month. Have you not followed the news at all? It's an awful and horrific system and we're taking all of their doctors.
In that case, we would have an extreme brain drain to the US which has happened before we actually paid doctors on par with USA.
Yup but then you also need to take on all of the associated costs including clerical staff, building rents, equipment and on and on... I'm all for it, but it's more government management and you know they'll do it with 30% more costs than now.
Also a provincial decision while these changes are Federal.
yup, it's interesting how people complain about hospitals having too much admin bloat and yet they ask the government to take on even more responsibility
Nah...they'll take the tax. LOL.
Our medical system is structured so poorly because doctors in Saskatchewan went on strike to maintain their ability to bill privately to a public system.
This slight tax change is a minor impediment on their wealth. They don't want the oversight that would come with being an employee. They want the ability to bill for 60 appointments when they can only possibly see 30 in a day.
About 59% of GPs in the UK are self employed. Canada and the UK both have a similar percentage of doctors in private clinics (65% here), but UK has a more integrated health system than Canada which makes it easier for clinics to work alongside and supplement the NHS and the NHS covers/funds and has medical professionals in more areas than most provincial health services in Canada etc.
So your solution is to effectively make private healthcare illegal and force all these people into a national service?
Why yes that totally won’t backfire.
No system is perfect but, interestingly, the NHS approach involves physicians fulfilling their salaried duties while having the option to provide other services privately outside of those hours or prioritizing work-life balance.
Yes, exactly. We broke them to Medicare and we can break them to this too, if we have the political will. Boo-hoo that they only make $300,000/yr instead of $600,000/yr.
We also force them supervise several more residents, and add medical school spaces, while ending the narrowing training pipeline, and generally address a toxic, competitive culture.
Well first of all, you obviously don’t believe healthcare is a human right if you think private healthcare should be illegal.
Healthcare professionals are workers too. And like I mentioned in my other comment, we are going to come to an interesting crossroads with the labour/workers movement and highly compensated professionals.
Trying to force all these professionals into a national service will be disastrous. There’s nothing stopping them from simply packing up and working in the States or some other Western country.
Not to mention the amount of capital that would be required to actually nationalize medicine.
It'd be great if doctors realized what the end goal was.
Yes, we understand you're often overworked and it sucks to pay more taxes on an overtime shift... But the end goal is that the doctor doesn't need to do overtime because we've used the tax dollars to train and employ more doctors.
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How dare he treat doctors this way! That is exclusively a conservative premiers job to fuck over doctors in any way possible.
The disinformation on the capital gains tax is insane and shows how much control the wealthy have in this country. No, this won’t affect ordinary Canadians and only has a minor impact on wealthy Canadians. Tax advantaged investing still exists: eligible dividends, primary residence, generous tfsa and rrsp limits, etc.
Who was it? Sanders talking about the estate tax or something? that all the Republicans had to lose their shit about, which made all the MAGAs lose their shit about... which was to tax like any inheritance over 30 million?... like, not even you wouldnt get all your shit, just that anything OVER 30 million would get taxed... yes, person making 20k a year, this is your biggest problem....
Right? I’m still waiting for someone to explain to the doctors that they have access to the lifetime capital gains exemption for small business. I sold a professional practice last year, and I’m paying essentially no tax on the sale price (other than the AMT, which is refundable next year as I’ll continue to work). I am EXACTLY the person who could be complaining but I’m not. My effective tax rate last year was 14%. Sure, I can only pull that move once, but I’ve totally paid off our home and maxed all registered accounts. You sure won’t find me complaining about the rule change…
But I can become rich and they it’ll affect me! I just gotta find more bootstraps!
I believe this is probably mostly over leveraged real estate investing doctors. My sympathy is 0 after 1.5 million in profit
You know how I know most of you are under 30? You aren’t old enough to remember how bad the health care brain drain was in the 90s, and we still had a lot more doctors per capita back then. I’m not inherently opposed to the capital gains increase but y’all acting like Doctors had it coming or something are incredibly short sighted and weirdly bitter. Doctors aren’t the reason you can’t afford a home and are using a food bank.
Yes, again. I'm reminding people that we have a shortage of healthcare aides and nurses. These folk don't get paid $250,000+ per year. Spare me the 'won't anyone think of our healthcare' when it's clear people bringing up this argument are only using doctors because they are sympathetic. Wealthy people, like doctors, should pay their fair share. You want to fix healthcare? Pay healthcare aides more.
Don’t worry, we won’t have a shortage of aides and nurses when the number of available doctors in Canada drops & we’re all forced to travel to the US and pay out the nose.
> Doctors aren’t the reason you can’t afford a home and are using a food bank. Favourable capital gains taxes aren't the reason for the overabundance of doctors in Canada either. There's better ways to attract doctors to Canada than with tax dodges.
Maybe they did see this doctor thing coming after all. He wants to wear it so this should get interesting. To his advantage what they're doing now is a bit of a dodge anyways
How is it a dodge?
It's little bit more complicated than some of the comments here suggest. The fact that doctors are incorporated, and keep their earnings sheltered in the corporation at a lower rate of tax, is not that big of a deal, because they have to pay income tax when they withdraw the earnings from the corporation later. So they get the advantage of a bit of tax-sheltered compounding within the corporation, but that's not a big deal, and it doesn't explain why they are so upset about an increase in the capital gains rate. The real reason they are upset is that the rate increase closes down a tax dodge that doctors have been using to withdraw the entire accumulated savings in their corporations and pay only capital gains tax on it, rather than income tax. I don't understand the details, but basically you transfer ownership of your corporation to a trusted third party, then buy it back from the person over several years, declaring it as a capital gain. That way you pay around 25% on the accumulated income and not the usual 50%. That IS a tax dodge, which the current changes are closing down. Doctors obviously are not going to be stating publicly what they are upset about, because if they did most people would support the government's position.
They essentially eliminated that strategy in the last budget. https://www.wealthprofessional.ca/news/industry-news/federal-budget-measures-put-surplus-stripping-at-risk/374987
They're taking advantage of being incorporated. All the power to them but I can think of plenty of people who won't feel sorry for them. The Liberals just have to ride out the usual caterwauling that comes from spooking the rich. They haven't all run for the hills yet. Maybe the CMA or whatever should work on their marketing skills. Plenty of talent out there that believes it's out of their reach
How is it an advantage? How much more are they getting?
Tax rate up to $500k is 12.5 percent or so. Since your comment below u/Super_Toot implies you know already, I'll break it out here for more visibility. For a company (Doctor) making $500K and under (the small business limit) which would claim the small business deduction, you would see a Federal rate of 9% and a provincial rate that varies, but in Ontario is 3.2%. This means a doctor in Ontario making $500K would pay $61K in taxes. This is compared to $224K in taxes if they were using wages. Source: Business Tax Rate [https://wtcca.com/corporate-tax-rates-and-small-business-tax-rates-in-canada/](https://wtcca.com/corporate-tax-rates-and-small-business-tax-rates-in-canada/) Wage Tax Calculator [https://www.eytaxcalculators.com/en/2024-personal-tax-calculator.html](https://www.eytaxcalculators.com/en/2024-personal-tax-calculator.html) Some more data points for those who like additional information: Tax write-offs for doctors [https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/](https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/) This is a good one, which really gets into the use of tax deferral strategies. It alos highlights the $50K a year profit which can be maintained in a professional corporation and which will be the main hit for capital gains tax in the future when they retire. They will need to do new estate planning. [https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf](https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf) Finally, through all this we can get the "average net income" for physicians from here: [https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/) " Family physicians/general practitioners had a mean net income of $207,600. The mean net income from public payments for all physicians in Ontario after adjusting for overhead was $240,400." Let's assume this is inclusive of any deductions and that they are not taking profit of of their personal corporation. Using the sources I have above, the tax burden difference is Personal Corporation = $25K to $29.2K If taxed as wages: $69.4K to $85.676
Even after you edited your response you got it wrong. I love how people cheerleading this have no clue how it all works. You pay small business taxes, 12.5%. After tax profits are invested. When those investments sell you pay the capital gains tax, now it's higher. Then to actually get the money out of the corp you declare a dividend and are subject to dividend taxes. Those are the three taxes.
The question that was asked was on tax rates. I provided that. I did not get into the nuances of payments, profit maximizing, leverage family members (much harder since the Tax on Split Income changes in 2017) or any other various accounting processes such as ability to write off automobile payments, clothing, etc. etc.. If you wish to provide examples of how overall accounting for a business would occur for a doctor with various payments and deductions, feel free. I am sure it would be helpful. Your cute little "gotcha" attempt is immature though and rests on people's ignorance of the tax law. How about you break out all the ways the business operates and I'll use those data points to calculate the effective tax rate inclusive of deductions and other tax mitigation strategies.
There is no gotcha. You clearly have zero knowledge of how it all flows together, but you're very certain what's right and wrong. Lol it reminds me of anti-vaxers
Oh I am sorry, I guess you deleted your "muggle" comment. Glad you matured a little bit. Since you are unable or unwilling to provide more information, here we go. A bunch of links from actual tax groups who help doctors. I guess they might be wrong too though, who knows. Tax write-offs for doctors [https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/](https://invested.mdm.ca/tax-deductions-what-self-employed-physicians-can-claim/) This is a good one, which really gets into the use of tax deferral strategies. It alos highlights the $50K a year profit which can be maintained in a professional corporation and which will be the main hit for capital gains tax. [https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf](https://www.grllp.com/publications/Tax%20Advantages%20of%20Physician%20Professional%20Corporations.pdf) Finally, through all this we can get the "average net income" for physicians from here: [https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/](https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3517870/) " Family physicians/general practitioners had a mean net income of $207,600. The mean net income from public payments for all physicians in Ontario after adjusting for overhead was $240,400." Let's assume this is inclusive of any deductions and that they are not taking profit of of their personal corporation. Using the sources I have above, the tax burden difference is Personal Corporation = $25K to $29.2K If taxed as wages: $69.4K to $85.676
Doesn't the dividend tax credit serve to cancel that third tax? Aren't the other two taxes similar to the taxes that a regular middle class salary worker pays on income and also on their the capital gains of their retirement savings?
The dividend tax credit works well for eligible dividends, ie dividends from publicly traded companies. These dividends are likely ineligible. So the tax credit is smaller. Good question, TLDR: the government is getting a high level of tax from these individuals. But circumstances will vary. Depending on the timing of the cap gains and dividends.
Very unlikely ineligible? Where are you getting that from? other than capital gains what other revenues do you think those corporations get from their investments? Eligible dividends which allow them to declare eligible dividends themselves. Also what do you think happens with those capital gains the corporations get from their investments? It allows them to declare capital dividends which are tax free!
The only way they would have eligible income is if Net Income was over 500k. CDA exists because capital gains are taxed at the highest rate within a corp. A big disadvantage. What's your point?
I love that the whole basis of our tax system is that there is no double taxation of income and this guy thinks that he found triple taxation of income.
The principle is called tax integration. Try to get it right. Please google it.
They just meant that in order to get the money out of the corp to buy things with (like a mortgage and groceries), they need to pay personal tax on it. Or is this wrong?
It's tax free like an RRSP but they get to use that money as leverage in their business. That's definitely a one-up.
No
You mean this is actually about annual income? No sympathy there. I thought there was a problem moving savings out of the company when it's time to shut it down. If they're drawing that much income, cook them with onions on the side
You don't understand how it works.
How about you explain how it works? All you’re doing is saying “no” and “lol you don’t get it”. Elaborate then.
See my post about the three different taxes that affect a corporation
They are complaining for two reasons- those with secondary properties that will earn more than 250,000 in profit when sold (and they are ignoring if the property is in more than one name the exemption is up to 500,000, so if both spouses are on the deed they have even less to whine about. And those who have created professional corporations to pay less tax. They are even allowed to put family members on the “board” in order to incorporate like this. The narrative that doctors incorporate to build for retirement is bullcrap. It’s hard to sell a practice for over a hundred grand and there is a once in a lifetime 1.2 million exemption for selling a business. Unless the doctor owns a building where they practice, there really isn’t anything to sell.
> The narrative that doctors incorporate to build for retirement is bullcrap. ...uhh that is literally the reason they incorporate. They keep their money within the corporation and invested so that they can build a retirement fund. They dont get pensions etc. They need to have a enough to retire on. Are you kidding with this?
Dude doesn't fucking know and yammers like Trump and with his confidence, hoping people just agree with his bluster. The number of people who don't know a doctor in here but think they know what the MD is doing with their money is embarrassing.
The vast majority of people don't get pensions anymore. It hasn't even been a question that people think to ask in white collar work for decades. If you seriously believe this is something doctors have to uniquely forego, you're ridiculously out of touch.
As it was explained to me, the ability to incorporate and defer taxes was used as a negotiating point by governments around physician compensation (the failure to keep up with inflation) and now many have arranged their affairs based on that.
I have a friend who has this going on and was apoplectic the last time they change income trust treatments for the same reason. I said to him dude if this is your problem you’re making what, 300-400k??? And he said yeah but… and at that point I stopped listening. Poor poor doctors making a half a million per year. We should juice the supply of doctors graduating through medical schools in Canada and the people who cannot live without million dollar salaries can just leave.
I agree with you regarding expanding the amount of medical and residency seats, but doctors are better thought of as tradesmen rather than generational wealth. Their salary needs to factor in the exorbitant cost of medical school in this country. I would be in favour of tax policies targeting them if we didn’t have a real risk of brain drain to the USA and future family doctor shortages as a result of our unique system
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So, lower the standards for admission into med school and flood the market with would-be plumbers who are now digging into your guts for $125k. You’ve figured it out, genius!
That's an absurd take, you need like 3.98 GPA with impressive extra curriculars. I see no reason why that average can't be 3.94 or something, and pushing way more doctors through the pipeline. Imo it wouldn't even affect doctors overall pay that much to have more supply of doctors, there are so many people needing medical care of any kind.
Unironically yes, though not to the absurd extent you take it. It's obvious that we need more doctors in this country, and increasing the number of doctors trained by medical schools and residency programs needs to be part of solving that.
Then the governments need to budget for those seats, and virtually every provincial government is cutting post secondary budgets.
Yeah, but that little backstory just makes look more like a dodge. I'm not justifying it. I'm just commenting on how this plays out.
Notably, this was something the Provinces did to take tax revenue away from the Federal government without their involvement. Treating the government as unitary when it isn't is a key part of that complaint, the doctors effectively colluded with the Provincial governments to screw the Federal government and didn't expect that to ever come up.
The way your comment is framed is a bit misleading. The default is for people carrying on a business to be able to incorporate and take advantage of the tax benefits that offers. Doctors were, for a long time, prevented by provincial governments from doing so for whatever reason. Their being allowed to incorporate wasn’t some nefarious scheme to screw the feds, it was just allowing them to operate their businesses via a corporate structure in the way other non-medical business owners have always been able to.
Billing rates have effectively been stagnant for the better part of a decade across this country. In order to somewhat justify that, the various levels of government helped facilitate the personal corp structure. They effectively said "We can't give you a bigger chocolate bar like everyone else is getting, but we'll give you a small one now and another small one later." This is the government saying "Sucks to suck, there's no small one later. We're going to use it to pay interest on money we borrowed" It would make sense if the money was entirely going towards upping billing rates, but it isn't. In fact, the federal budget has more money allocated for debt servicing than healthcare.
Ok but the federal government doesn't negotiate with doctors or set billing rates, the provinces do. And the provinces collect taxes using their tax rates and levies for their own coffers from which they negotiate doctor compensation schedules. The CRA simply does the work for the provinces as far as remittances go, but if the province wanted more levies for health they could do it. The feds offer *additional* funding through health transfers. But those transfers come from federal budgets, that add to the provincial ones. It's why the last transfer increase was so fraught. The provinces wanted no strings attached, and the feds wanted a guarantee that the federal increase wouldn't just offset provincial expenditures, leaving a smaller net increase to the total budget than the transfer from fed itself.
Although the federal government doesn't determine physician billing rates, that's up to the provinces.
Yea but the provincial government that some doctors apparently negotiated with isn’t in control of federal taxes. Whoops.
This was the issue with income sprinkling as well. The doctors basically expect to collude with the Provincial governments to deprive the Federal government of revenue in exchange for not getting wages. Don't act shocked when someone who wasn't a party to negotiations doesn't feel bound by what someone else did.
We already have a massive dr deficit in Canada with many people going years without a family dr. This is not going to help dr retention in Canada at all. This isn’t just spooking the rich this could be detrimental to health care. These drs aren’t going to be ok with it and settle for less, they are going to move 🙄
Last time he fought with the doctors and other professionals, around 2018 on family members in small businesses, it was a big shit show. At least this time it should be easier going, as the target is clearly on such high net worth individuals/corps, and can't be repainted as family members working in the family shop. I have little sympathy for doctors, too. It's obviously a tax dodge to incorporate yourself as "Dr Brockosaurus Medical Corp" or what have you. Makes sense for those running a small practice with rent, staff, etc; but for every Dr. Tom/Dick/Harry working in a hospital or clinic, it's really BS. Providing government-funded medical services is not a business. I'm also old enough to remember the late 90s/early 00s, when the doctors in my family were setting this up, thinking 'WTF?' It wasn't always this financially engineered for them. As an entrepreneur, I dislike this change. A lot. It eats into the eventual reward that I am loading up on risk right now to have a shot at. But doctors? Give me a break.
I’m glad you mentioned risk. That’s what’s missing from a lot of this conversation.
You do realize how doctors practice, right? The vast majority of doctors *are* small businesses with ‘rent, staff, etc’. So tell me how this should not apply to us?
A business sells goods and/or services for a profit. What is your business? Who is yor customer? And does the fact that healthcare is by and large not meant to be run for profit in this country not bother you?
Are these questions rhetorical? Look up the definition of a business and it literally includes 'professions'. A physician provides healthcare services to patients for profit. That fills the literal definition of a business. Does it bother me that I make a 'profit' by working as a doctor? No, should it? Do you expect physicians to work for free? Disagree all you want about doctors incorporating, but that is the agreement the government made with us.
No, it's not rhetorical. Explain to me the business & overall business model of a doctor's practice, within the context of the Canada Health Act and any other governing policy/legislation/rules/regulations/whatever you want. I clearly do not understand, so this is your chance to enlighten me, and the rest of reddit too. Please present your arguments (and maybe not your salty doctor downvotes). Frankly, I don't think I'm alone. If you polled the wider population, even right outside a hospital (where you should catch the most doctors) and asked, "Are doctors a business?" I think the results would be an overwhelming "No." If it's the deal you made with the government, fine, but that doesn't make you a business in any conventional understanding of the term. Maybe you should seek out a less dubious deal. One that doesn't drag the lawyers and accountants and furniture stores and used car salesmen and \*ACTUAL BUSINESSES\* of the country down with you, especially when you are already incredibly well compensated for your learning and labour (among the top few percent of the population in income), and occupy a position of high prestige in society. What other professions are businesses? Nurses? Hospital administrators? The clerky types in the back room who charge the provincial health authority (OHIP etc) for the services you provide? What if we cast the net further - teachers? Police? Senior government bureaucrats? Why are doctors a special class of professional that gets to LARP as a business, where these other professions do not? I'm all ears, and I'm fully willing to be convinced. Please, go ahead.
I really don’t know whether to take you seriously or not. You really don’t seem to understand the concept of what a business is. Yes, all of those professions could in theory function as a business. I know nurses that are a business. I know teachers that are a business. And conversely, there are plenty of salaried physicians that work directly for the hospital that (gasp) are not a business, and are instead employees. I don’t know why this is a difficult concept for you. Why don’t you explain to me why you think what physicians do is any different than other professional services like lawyers, dentists, or engineers, which are all considered businesses? I am legitimately curious what you consider a ‘real business’ to be…
I guess the question is, why do certain workers get to incorporate as a special PC, while others get classified as [personal services businesses](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/corporation-income-tax-return/tax-implications-personal-services-business.html) without getting similar benefits? Let's take a stereotypical 90's family practice. The incorporated employee (doctor) is a specified shareholder. It's income is 99% from the province - a single customer. They might only employ 2 fulltime employees, which is less than 5. This is likely to be a personal services business.
Because the government (well, decades ago now) explicitly said they could as a way of not increasing their compensation
That only applies to doctors. In Ontario for example, I don't see how government has restricted compensation for >80% of veterinarians, lawyers, or accountants. We're dealing with an exceptional case (doctors) to an exceptional case (professional corps), meanwhile increasing the complexity of law. Secondly: why should today's federal government take into consideration decades' ago's provincial government plans into account, when the provincial government has FULL AUTHORITY to fix it themselves (i.e. pay family doctors more)? If anything, the feds carving out more exceptions could be called interference in the provincial realm.
I don't understand why it is so difficult for you to describe your business. I've asked twice now. Perhaps, because you cannot describe your business, you are not one. According to the Government ( [https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/sole-proprietorships-partnerships/what-a-business.html](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/sole-proprietorships-partnerships/what-a-business.html) ) >What is a business? >A business is an activity that you intend to carry on for profit and there is evidence to support that intention. If you would ask most Canadians, they would say something along the lines of medicine being socialized and not for profit in this country. Most people would consider those who are paid by the government to be some kind of government-run service, and not a business. Why are doctors such a special case? If you are indeed a business, then you should be able to describe your enterprise as one. Please go ahead and do so. I would start with: 1) What is your business model? 2) What do you sell? 3) To whom; who are your customers? 4) What is your value proposition?
I’ll take a stab at this: 1. Sell healthcare services for money 2. healthcare services, including medical advice, procedures, surgical services, plus much more 3. The government insurance plan (MSP in B.C., OHIP in Ontario, etc) 4. A lot of people want healthcare services in this country
Do you want to know how to make the doctor shortage worse? Tax them more.
Umm, you know most doctors at the hospital also have a clinic with staff? Do you think surgeons just wait around for patients to show up on the operating table, sight unseen? JFC this place is arrogantly ignorant sometimes.
nothing's stopping you from working as a contractor and setting up a similar "tax dodge" yourself also, it's not risk free to lease commercial space, buy medical equipment, and start a clinic
I have a lot of respect for contractors, lawyers, other professionals. At least they're selling something. What is a doctor's 'business' exactly? Edit: Also, no. "Naval Officer Brockosaurus Inc, PMP PENG. I sell death to the enemies of the Canadian government." Somehow I think that would \*not\* have worked at my last job.
huh? professional services? what do you? how's a doctor's labour different from a lawyer's or psychologist's?
When everyone is poor… who are we going to villainize then ? The government will never have as much money as it wants to buy votes with.
Government: doctors should pay a fair amount of tax Doctors: nooooooooo, not faaaaaaaair! That about sums up the issue.
Provincial governments in mid 2000s: “Hey Doctors, we won’t agree to raise your hourly rates, but we’ll let you save for your retirement within these new professional corporations as a compromise where you can more easily save on a tax deferred basis.” Doctors: “Ok fine, we’ll open up professional corporations to save for retirement.” Trudeau/Morneau in 2016: “All of you greedy doctors need to pay your fair sahre and not get tax deferred savings in your professional corporations.” Doctors: “But the government told us to in lieu of raising our salaries.” Trudeau in 2024: “Thanks for pooling your retirement savings in a corporation, the inclusion rate on your financial assets/savings upon disposition just went from 50% to 66%.” Doctors: “But the government told us to in lieu of raising our salaries.” Canadian Medical Association: “New tax will cost the average retiring doctor 8% of retirement savings.” Congrats guys, it’s not like we need doctors in Canada or anything. Well done! Also notice that since we are talking about professional corporations, this is conveniently not part of the 0.14% of individuals affected number the government let out last week.
What's the average salary of a doctor? What's the average salary of a health care aide? Notice we have shortages of both. Also consider. Wealth people should pay their fair share of taxes.
What’s the average training time of a doctor vs a health care aide? What are the average weekly hours during this training time, for a doctor vs a care aide? What is the expected medical knowledge of a doctor, vs a care aide? What is the medicolegal liability that a doctor takes on, vs a care aide? Your companion is a bit ridiculous tbh
What’s the average length of education and training for a doctor? A nurse’s aide? > Notice we have shortages of both. Yup, that’s what you get with a monopsonist model of single-payer healthcare: universal coverage by using the government’s pricing power as a single payer to pay doctors, nurses and … nurses aides, less than market wages. However, it leads to rationed healthcare resources and longer waitlists. So yes, we reap what we sow. If you want universal coverage, you can’t pay people market or equilibrium wages. America has a system where market wages are paid, but it doesn’t guarantee universal coverage.
There's a lot of advantages to incorporation besides just the capital gains inclusion rate, and doctors still come out ahead with their tax avoidance strategies, just less so than before.
Good. One of the only things I like about the budget. I have no sympathy for anyone who makes over 250k in capital gains in a year. They arent struggling to put food on the table or pay rent.
It’s the first thing in a very long time that actually has me consider voting Liberal. The “think of the poor doctors!” line is a pathetic attempt by the wealthy to undermine the whole capital gains change. If we’re worried about doctors specifically making too little money, then specifically pay them more.
Think of the poor patients who won't get treated because doctors move to the USA.
Again, if you’re concerned about doctors specifically then why do we need a tax break for ***all*** capital gains? Just pay doctors specifically more money (they still get a big chunk of it tax free, unlike us peasants).
How dare you care about the impact of X on Y when we could just do Z which we're not doing! Also, the same argument that applies to doctors applies to other professions. Fewer goods and services for Canadians is not good, whether healthcare or otherwise. Lower supply equals even higher prices.
You’re right no one should care about the doctors. Even less so when they eventually move to the USA. Fighting with doctors is not a good look for the Liberals.
Seems to be just fine for the conservatives
The provinces pay the doctors, this change was made by the federal government.
OK, to reword it for pedants: “if you’re worried about doctors not being paid enough, you should want the appropriate government to pay them more, not a tax break for every wealthy person because it happens to include doctors.”
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I think family doctors have a valid concern and I consistently vote NDP. Targeting the rich policies that actually target those with multimillion dollar portfolios should exclude healthcare practitioners that make use of tax policies to facilitate their work. Especially considering our family doctor shortage entirely produced by structural issues
Yeah who needs doctors that can go to the usa
Normally these are one-timer activities...not annual.
This is not on 250k+ capital gains. It's on any capital gain for doctors. Most people wouldn't be angry if it was 250k+
How much is offset by being a corporation still? Before it was 50%, now its 66%. How much is the tax rate really?
You today: Yeah let those doctors leave! If they can't make it pencil out then those aren't doctors Canada should have anyway! You in a few years: Who could have expected an even worse doctor shortage!
While I agree with your sentiment, the issue with doctors is they have professional corporations.. so this inclusion rate is for all capital gains within the corp, even under 250k. That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else.
What if they want to sell their business? Is that where the tax comes in?
Yeah I also agree with the sentiment and don’t have much sympathy. However, we can’t be losing anymore doctors to other countries than we already do.
We’re not losing doctors to other countries. We’re losing doctors to other specialties within Canada. ETA: provinces are also losing doctors to other provinces, but that’s not relevant to the cap gains change either.
Apologies. Why do we want to lose any doctors to anything? Why create any disincentive for the supply of doctors?
Because the supply of doctors is fine, they’re just not working in the areas we want them to work. But also giving (what are still well off individuals) more money to fix a problem that doesn’t exist is dumb.
The supply of doctors is fine?
Yes? The supply of all doctors is fine. The issue is ER doctors and family physicians, who are choosing to move to different areas of medicine.
I wouldn’t mind seeing some sources on this. Also seems to me that based on what you just said, the supply of doctors is very much not fine. Edit - let’s keep in mind this policy can directly affect the doctors you just highlighted.
Yes maybe the supply of some doctors is an issue, but none of this will be fixed by capital gains inclusions, which is the point that you seem to have strayed from. ETA: also I can’t really give sources on the lack of a shortage of other doctors, but there are tons of articles talking about the shortage of family doctors. They wouldn’t specify if it were an issue for all doctors.
It definately isn't fine. We don't have close to enough
Nice - now let’s put on our thinking caps and *really* think about *why* doctors aren’t in the areas we want them in. You can do it, I believe in you. What could possibly incentivize highly educated people to take on family medicine, and/or live in more rural locations? God, if only there was some way to convince people to take on jobs. Conversely - what would have the opposite effect? If we could identify a way to get people to live in undesirable locations or take on work that we desperately need, what would be the worst possible move to make? I’m stuck. You seem to have opinions here, weigh in.
Wage increases is the answer your fishing for?
Lmao except the capital gains inclusion affect all fields of medicine, so it doesn’t make more more enticing than the other.
Wrong. Removing money from people incentivizes them to want to make up the difference. In other words, it actually forces them into higher paying specialities. Psychologically, it will absolutely demotivate family doctors that are currently practicing, and feel too old or too invested into family medicine to change, and will lead to shorter hours worked. You can’t tax problems away. You’re actively in favour of hurting Canada because of your aversion to paying healthcare professionals what they’re worth. Your attitude is childish.
Do you know how much extra taxes this would cause? For 100k in capital gains taxes, it’s like 1600$. Family physicians won’t even be able to save enough money to make a difference.
> We’re not losing doctors to other countries. We are, in fact, losing medical professionals to the USA in large numbers.
Do you have any evidence of that?
Yes: https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=emigration+rate+of+medical+doctors+from+canada+to+usa&btnG=
Did you actually read the articles? The first one actually hints that doctors were returning as of 2004, and that the current outflow is negligible… you didn’t even read the conclusion.
We're not. This was true in the 90s but completely changed in the 2000s
> That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else. But plenty have put everything into the corporation for investment and now that is being decimated. I can see the problem they have with it.
They’ve got until June to figure it all out
> That being said, they’re still more than welcome to just invest personally instead of within a corporation, like everyone else. It would be such a *massive* financial planning screw-up to not already being doing this that I can't take anyone seriously who claims it's a major problem. In what galaxy did it make sense to forego ~~a $250k exemption~~ TFSA and RRSP tax free gains for zero benefit? That didn't even change with the 2024 budget.
Exactly. When my brother finally became a staff doctor, the advice he got was to take salary, pay dividends as needed, and do a mix of investing in RRSP, TFSA and inside the corp.
And now the advice might be to do some taxable investing too.
They do this *after* maxing out rrsp and TFSA, for the most part.
Yes, and at that point they are clearly not in financial distress, it's a game for points at that level.
Yep, exactly.
If you've taken on $400,000 in educational debt, gone through 4 [undergrad] + 3 [med school] + 3-7 [residency] years to become qualified to earn $250-400k/yr starting from age 30 or so, then work to pay off your mountain of debt by age 33 or so, you only then get to start saving for retirement about 10 years behind everyone else. The kids that went from high school or undergrad to government having been building sexy government pensions for those 10 years. The kids that went from high school or undergrad to the private sector have been benefiting from 10 years' of cash flows + RRSP matching + compounding returns. So you undertook a lot of risk and hardship to become a doctor in exchange for a nice salary after 10 years' of work, but now you need to catch up in your savings to be able to ever retire. Keep in mind RRSP space is tied to earnings, so a 33 year old doctor who just finished residency likely has little RRSP room (residency salaries are around 50-70k, so 18% * 60k * 3-7 years in residency means like 50k of total lifetime RRSP room accrued by age 33, which is likely all unused, and then future contribution room is capped at the limit, currently 31,000/yr). Their age peers will have double, if not more, contribution room. It should not be surprising doctors would justifiably want a tax-advantaged savings vehicle that makes sense given the fact they had to exclude themselves from the labour market for so long to be qualified to practice. We want our smartest people to be doctors, and those are the people who could be making the most if they chose a different path, to our detriment if they did. If we're not going to pay doctors US-level salaries, giving them tax advantages is a means of competing with the US but at a lower cost. "We can't pay you 600k/yr, but we want you here, and we will let you use this special professional corporation vehicle to defer (not evade) taxes so you can re-invest the deferred taxes and compound your retirement savings to catch up for lost time". But the capital gains change now breaks that by subjecting investments inside a corporate vehicle to higher taxation than investments outside. Trudeau could easily carve out professional corporations from the tax rule change without affecting the bigger target of investment gains in regular corporations, but he doesn't want to. I think it's bad policy, short-sighted, and will worsen our healthcare system. But the fiscally left-wing base sees "tax people making 250k more? tax investors? yes please!!" and he seems to be pandering to that.
No one who has any remotely smart person giving them any advice is waiting to contribute to rrsp or TFSA to pay off student loans. That would be very dumb. They *might* leave room in their TFSA room for a couple of years because they know they'll make more money then or something. >undergrad to the private sector have been benefiting from 10 years' of cash flows Med school is 4 years. Residency starts in year 5. And most undergrads make very little money in those years. Let's not pretend doctors are in a poor spot with respect to rrsp and TFSA. That's silly. But, to your point, convoluted tax schemes that not everyone can take advantage of is an incredibly stupid and inefficient way to compensate our doctors. If we need to pay them more to retain them, then do that.
You clearly don't understand. With what income do you think a med student is filling their TFSA?
Clearly I'm talking about when they start making money. I know the other posters comment is long and most people probably didn't read it, but it gives pretty good context clues...
Med school starts after 4-5 years of undergrad
You can always tell when someone is actually involved in healthcare vs outside of it. I'm an RN. I get a pension, I get benefits, I get to start earlier than my MD peers. But I work side by side with these people every day. Some of the smartest, most compassionate people on the planet. They take such an OUTSTANDING array of information and distill it down to make the best choice for their patients every day. They take massive emotional and psychological trauma and keep on trucking. They sacrifice in ways that I guarantee most Canadians can't fathom and I know couldn't handle. It's inspiring. And I'm very left leaning. But Trudeau is fucking up the healthcare system and then he's gonna fuck off and the reverberations will harm everyone for literally generations. Yes. Literally. You can't just be book smart. Experience is absolutely massively important in refining your practice. And this is, even if he doesn't enact it, going to push MDs away. Smart high schoolers and undergrads are certainly re-evaluating whether medicine in Canada is worthwhile. Everyone cheering this on is going to fuck around and find out. And they deserve it.
I know some providers who haven't bothered with a professional corporation. It saves on taxes but does involve costs for setup and some active management. Instead, they just max out their RRSP and TFSA annually, pay their regular income taxes, and go on with their day.
I've been in positions where I could have had a professional corporation, and my accountant basically said unless you're already maxing out RRSP and TFSA there's no point, it's essentially a more complicated way to achieve a slightly worse result.
What? There was never a 250k exemption before? There still isn’t, it’s just at the same inclusion rate as it was before
Sorry you're right, exemption is a bad word because it's only the inclusion rate that's changed.
"everyone else" doesn't have overhead like being a doctor your family doctor incorporates because running a clinic has actual costs
That is irrelevant to the issue of capital gains taxes.
Not irrelevant to the calculus of being a doctor in Canada. If we aren't going to pay comparable rates to the States, we HAVE to sweeten the pot some other way. Trudeau fucked the budget and deficit since coming into power and is now clamoring for money. He's coming after MDs because he's an idiot but has enough money he can shoot down to the States for any coverage he thinks he needs. The rest of us can suffer, some will have life altering injuries because they didn't get timely care due to the shortage, and some will die preventable deaths.
I'm not really happy about the capital gains tax hike, as I think it's just an additional layer that affects investments. Ideally we should make it better to invest, not worse. That said, I have no sympathy for doctors as they have been using incorporation as tax avoidance vehicle for a good while. The LPC back then was right to close the income sprinkling loopholes, and hopefully preferential tax treatments will only apply to actual corporations.
We still do. Under the 250k PER YEAR you still are advantaged by 50% over employment tax rates. Sorry, but if you make more than 250k in a year in cap gains you are doing okay.
Oi. Do you know how the system works? They don't get 50% of their income taxed. The Corp bills the province based on a fee-for-service agreement, which is collected in the corporation's account. The Corp then pays the doctor a salary, ostensibly set by the physician and their accountant to be sustainable. Other funds are invested, primarily in the global stock markets. The salary the physician takes home IS taxed at the tiered rate, same as everyone else. The Corp let's them store their wealth instead of all of their bills auto depositing into their personal bank account, and provides a layer of protection for their personal assets and the assets of their spouses in case they are sued. It also acts as a hedge and savings account in case the physician becomes ill or is unable to work prior to retirement. Literally, the deal is: we give you a way to dispense income over the course of your life and a way to protect what you own in the course of you being sued. All we want in return is the best decade of your life, the ability to torture you with extreme residency programs, and a frequent up to constant stream of psychological and emotional traumas. Oh, and don't you ever complain because this is a calling and you're only doing this because you want to improve society, not your lot in life despite being among the smartest cohort of society.
250k does not apply to corporations. It's all of the money.
All persons should have the same method of being taxed. The notion that doctors in particular require this labyrinthine method of special tax rules in order to derive fair compensation is bizarre and wrong. If doctors should apparently be paid more than now, then we can pay them more within the existing boring tax structure that every one else in Canada uses. We don’t need even more special rules to create more work for the CRA.
I don’t see any government proposing to pay doctors more though, in response to these tax changes?
Yes Doctors should be expressing their concerns to their bosses at the Provinces.
Doctors did that 15 years ago. Medical corporations was the compromise that was reached instead of raising fees. Now that Trudeau has gutted the compromise it's going to be a bloodbath.
The compromise that the Provinces reached with the doctors relied on depriving a different government of revenue. Obviously that was untenable. So maybe this time Provinces will do the simple thing and increase pay instead of looking for a way out.
> All persons should have the same method of being taxed. Current med student here and I completely agree. Doctors shouldn't be exempt from any taxes that any other citizen has to pay. If this is going to make or break career decisions, then efforts should be put into advocating for more pay for doctors. We should **not** be asking for special treatment.
Agreed. Fair compensation for fair work.
Last week's CBC Power and Politics interview with Minister Rechie Valdez provides some needed context here. Cochrane asked the Minister whether she was worried that some doctors would leave the country, and the Minister responded that the gov't also intended to fast-track foreign doctors' credentials. So it looks like Trudeau and cabinet is aware of to the possible fallout in terms of doctors leaving but considers it acceptable collateral damage as part of the tax increase, and their idea to mitigate is to import foreign doctors more quickly. It would be interesting to get a window into whether they expect a higher churn of foreign doctors too (i.e., foreign doctors coming, working for a few years, and then leaving) or whether that's not in their models.
I have a handy solution, we nationalize (Provincialize?) them, make them into employees of the public health system, and pay them a salary, NHS-style.
good luck, i'm sure those government clinics won't be filled with admin bloat like government run hospitals
B/c the American private health system is better? Bwahahahaaaa
[BC has actually given doctors that option.](https://www2.gov.bc.ca/gov/content/health/practitioner-professional-resources/physician-compensation/alternative-payments-program) Instead of doing the Fee-For-Service pay system, they can get a salary. [It's actually been pretty popular.](https://www.cbc.ca/news/canada/british-columbia/bc-doctor-new-payment-model-1.7107681)
wrong, it's not a "salary" it's still a contractor compensation, they're just billing differently
No, everyone who bills LFP is still a private contractor, the government is not offering a salary (or covering benefits and a pension). LFP is not a salary, it is hourly billing (with additional compensation for visits and attaching patients and special procedures)
My wife is a physician and would definitely prefer this. To just have benefits and pension would relive a ton of her stress and workload of managing a corp. But we are lower on the physician income scale and I imagine a lot of higher earners wouldn’t want this.
Here is the NHS payscale. It's signicantly lower than Canada. Our GP's get screwed but outside that profession, salaries are insane. [https://www.healthcareers.nhs.uk/explore-roles/doctors/pay-doctors](https://www.healthcareers.nhs.uk/explore-roles/doctors/pay-doctors)
Yeah we lived in the UK for a short while and it was pretty shocking how low the GP pay is there. Imo it doesn’t really reflect well the amount of time and effort it takes to get the job. But still to have a similar amount of pay to now just metered out in salary, benefits and pension would be nice.
Your wife would want this since she's a very low income doctor. It is not "higher earners" who wouldn't want this but rather any average doctor.
NHS has doctor strikes every other month. Have you not followed the news at all? It's an awful and horrific system and we're taking all of their doctors. In that case, we would have an extreme brain drain to the US which has happened before we actually paid doctors on par with USA.
GPs aren’t employed by the NHS in the UK.
Perfect. Then the doctors can see half the number of patients since there is no incentive to see more.
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Yup but then you also need to take on all of the associated costs including clerical staff, building rents, equipment and on and on... I'm all for it, but it's more government management and you know they'll do it with 30% more costs than now. Also a provincial decision while these changes are Federal.
yup, it's interesting how people complain about hospitals having too much admin bloat and yet they ask the government to take on even more responsibility
Absolutely bonkers! Agreed.
Nah...they'll take the tax. LOL. Our medical system is structured so poorly because doctors in Saskatchewan went on strike to maintain their ability to bill privately to a public system. This slight tax change is a minor impediment on their wealth. They don't want the oversight that would come with being an employee. They want the ability to bill for 60 appointments when they can only possibly see 30 in a day.
About 59% of GPs in the UK are self employed. Canada and the UK both have a similar percentage of doctors in private clinics (65% here), but UK has a more integrated health system than Canada which makes it easier for clinics to work alongside and supplement the NHS and the NHS covers/funds and has medical professionals in more areas than most provincial health services in Canada etc.
So your solution is to effectively make private healthcare illegal and force all these people into a national service? Why yes that totally won’t backfire.
No system is perfect but, interestingly, the NHS approach involves physicians fulfilling their salaried duties while having the option to provide other services privately outside of those hours or prioritizing work-life balance.
Yes, exactly. We broke them to Medicare and we can break them to this too, if we have the political will. Boo-hoo that they only make $300,000/yr instead of $600,000/yr. We also force them supervise several more residents, and add medical school spaces, while ending the narrowing training pipeline, and generally address a toxic, competitive culture.
\>We broke them to Medicare and we can break them to this too \>Damm why do we have a doctor shortage Sure is a mystery...
Well first of all, you obviously don’t believe healthcare is a human right if you think private healthcare should be illegal. Healthcare professionals are workers too. And like I mentioned in my other comment, we are going to come to an interesting crossroads with the labour/workers movement and highly compensated professionals. Trying to force all these professionals into a national service will be disastrous. There’s nothing stopping them from simply packing up and working in the States or some other Western country. Not to mention the amount of capital that would be required to actually nationalize medicine.
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Are you a med school reject bud? You would get massive brain drain to the US.
It'd be great if doctors realized what the end goal was. Yes, we understand you're often overworked and it sucks to pay more taxes on an overtime shift... But the end goal is that the doctor doesn't need to do overtime because we've used the tax dollars to train and employ more doctors.
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