By - paris5yrsandage
Seems like a no-brainer. So of course it won't go anywhere... Signed anyways though.
As a rich person with a taxable account much larger than TFSA limit, i care not if a company is a REIT or a corporation, makes no material difference to my tax rate.
All this does is hurt seniors with TFSAs and RRSPs with REITs that dont benefit from dividend tax credits.
How much is it really going to hurt seniors though? They can just invest their money in other vehicles that provide solid dividends and do just fine.
It will ultimately hurt the actual REIT's themselves as they won't be as attractive investment opportunities. This is good in my opinion, and needed to lower the amount of corporate ownership in our real estate market.
It has no effect on the wealthy. 0. None. Doesn't matter.
REITs are VERY common in registered accounts, 1) they tend to be safe and stable, see CHP-UN.TO loblaws landlord. Stable from 2016 2) seniors need some more income than bonds. CHP has paid 5% since 2016 vs 2%-4% for 10 year bond.
How many? Umm like every senior should be using TFSA for REITs, its one of the best retirement assets and tax planning strategies. RRSP is good for USA reits too due to tax treaties between canada and usa not applying to tfsa.
How much does it hurt? Well every dollar that is taxed hurts them. Dividend tax credit doesnt apply to registered accounts. Vast majority of the riches money isnt tax sheltered.
You want seniors to buy riskier equities? Oh ya good time to, sp500 is down 20% lol have fun with that in retirement.
You somehow managed to be super condescending while only skimming any of my points lol so good job on that front.
I understand what you're saying, it's a good source of retirement income for seniors. I just also think it's a big contributing factor to the housing unaffordability in our country.
I fundamentally don't think profiting off renters should be a primary retirement income for people, and you've only further illustrated how common it is.
Then ban it. Make being a landlord illegal, whatever.
Dont mess with corporate structure.
No need to fuck with the tax code. People make decades long planning around the tax code, dont mess with it.
Sure tax rates up/down, whatever.
Fair enough. Housing affordability is a complex issue with no simple answers. I think you know an outright ban is never going to happen though, so how would you suggest reducing corporate ownership of rental units?
By the way, I don't have a problem with industrial/commercial REIT's. If all they did was ban them for residential I'd be cool with that. We can complain all day about it and shoot down ideas like this one (There are clearly holes as you've accurately pointed out), or we can start trying to do something about it. Right now there's no political will to do anything.
There is no solution cuz political will is to make it worse. Boomers love seeing their asset go up in value.
The solution for everyone else? Same as im doing. Getting as educated as possible and moving to usa on tn1 visa. Canada is done to me.
>There is no solution cuz political will is to make it worse. Boomers love seeing their asset go up in value.
We're in agreement here. Hence why I support a politician (Mike Morrice) trying to do something about it even if the solution isn't perfect.
>The solution for everyone else? Same as im doing. Getting as educated as possible and moving to usa on tn1 visa. Canada is done to me.
You lost me here though... I see this said a lot, but USA has their own problems and I'll still take Canada.
Usa has higher wages vs rent. For me, nothing else matters. I understand if you differ.
The road to hell is paved with good intentions. But i agree, a politician trying to do something, even if negative, is better than one saying make house prices go up like Adam Vaughan is saying.
It's not the profit per se, it's the extremes: greed, money laundering, foreign investment, lack of oversight.
There's a law of unintended consequences here, like the accountant who tried to explain this. That also includes investors removing themselves entirely and taking money elsewhere, which defeats the purpose of taxing to fund affordable housing.
The explanation is right in the post you’re responding to.
You're both acting like REIT's are the only option for retirement income for seniors. They're not, and I don't think they should ever be in any case.
The point I’m making is that you’re not even reading the arguments being made. Just mashing your opinion into the keyboard in every post regardless of what came before.
>The point I’m making is that you’re not even reading the arguments being made.
Not sure how you're coming to this? I clearly was reading what the guy is saying and responding with my own thoughts on the matter. You're free to disagree as is he.
Does anyone else feel that Mike is the only MP who actually DOES anything in our government? He’s brought forward some pretty big initiatives which is so awesome. Wish everyone else in our govt wasn’t such a bunch of wet fish.
He’s very active for sure. He won my respect with voting against the Emergency Act at the time, acting as a critical and thoughtful person. So I’ve been supportive of the actions he takes .. which are many. We’re lucky as a constituency.
Thanks to everyone who signed! In case anyone's curious, when I signed the petition and made this post at 11:30am, the petition was at 72 signatures. At the time of this comment, [it's at 123](https://petitions.ourcommons.ca/en/Petition/Details?Petition=e-4198). It's been open for signature since Nov 17, so that's probably mostly us. If you're able to share it in a group chat or with folks you know, that will probably also help.
If you've ever signed a change.org petition, you know the spiel. The government of Canada doesn't have the same "share on facebook, twitter, email, etc." type messaging, so I figured I should probably say those things because they do help despite sounding old, repetitive, and possibly a little annoying.
EDIT: In celebration of getting past 250 signatures in the past 4 hours, [here's the part of Bon Jovi's Living On a Prayer where he goes "ohhhh we're half way there!"](https://youtu.be/lDK9QqIzhwk?t=93)
Most REIT's are commercial real estate though.
Why single out REIT when corporations who are not investment trusts get to do what they want...
Why not both?
We're not singling out REITs. We're tackling obstacles one at a time, and this one just happens to be an easy one to start with.
A law that is unfair to corporations will not pass. It has to apply to all corporations equally or nothing.
one step at a time.
Hi u/headtailgrep: 1) Because it’s a step in the right direction that is reasonable enough to get support from other MPs 2) Because REITs are not solely invested in commercial real estate - in the past 20-plus years REITs have acquired almost 200,000 units of residential rental housing 3) Because REITs are currently singled out for this tax exemption, whereas this petition calls for them to be uniformly taxed like other corporations 4) Because as it stands, REITs are reducing the supply of affordable housing in our community and across the country by seeking to maximize returns for their unitholders.
Then change it so REIT income doesn’t include single family homes as this is the problem.
REIT's are an important source of afforable housing as they own, finance, build, repair, and supply apartment buildings and commercial and industrial real estate.
Some are strictly commercial real estate...
Your petition will not fly and it will have the opposite effect as capital will fly from REIT structured companies and you will have far fewer apartment buildings built
Also they can just change to a non REIT corporation and poof nothing has been resolved
Be careful what you wish for folks. This petition is flawed from the start.
Sorry to be the only one calling it out... but it is the truth
How do you see how many signatures it has?
Click the link in the post you replied to and scroll to the bottom. Currently shows 338 at the time I'm posting this.
Would the REIT shareholders get some kind of capital gains tax exemption or is the plan to tax both the fund and its holders on the same profits? If that's the case, surely they'll restructure somehow to avoid the double taxation. Seems like a half-baked idea from someone with their heart in the right place.
Yeah.... I like Mike and am proud and thankful to have him represent me in Ottawa, but all this does is flip the taxation of trusts to mirror corporate income tax treatment. One of the fundamental principles of tax law is called integration, the idea being you should be agnostic as to whether you pay taxes corporately or simply personally once the funds land in your pocket to spend. The overall rates should be approximately equal. It's not perfect, but it's close.
Trusts generally want to flow through the income to be taxed personally (opportunity for lower tax rates, deferral mechanisms, etc.) rather than the more complex set of calculations brought to bear on corporate taxes and dividend income.
Want more revenue? You'll need to adjust rates, get a bigger pie growing, introduce new taxes, etc.
He also cites the corporate tax rate as 38%, which is the kind of telling "truth" that he didn't run that petition by an accountant.
Must like T5's better than T3's I guess...
That's really interesting to read, thank you for the info! So if it's essentially the same rates in the end, why do you think REITs are taxed differently at all?
Well, trusts are a different kind of legal entity \[Edit - legal ARRANGEMENT\]. Some of them are actually treated like their own individual in terms of qualifying for graduated tax brackets as though they were another literal person (although that's been dialed back nearly to zero in the past 10 years). Trusts and partnerships tend to function on a more flow-through basis from a tax perspective. The partners and trust beneficiaries eventually are human people or corporations, which are then subject to their own income taxes as per relevant tax law.
Strange to hear someone find that interesting though, lol! I dig on this stuff, but I'm more of an oddball.
Hi u/thefringthing: we're simply asking for REITs to be treated like other corporations.
To answer your question - no, REIT unitholders wouldn't get any new exemption. Capital gains tax would be levied when individuals sell their investments. Currently any individual who earns a profit by selling stocks must indicate in their return the amount they earned, for the government to apply a capital gains tax. This motion won't change that. It will stay the same.
This motion would though bring REITs into line with corporations that are taxed on revenue, and then the individuals would be taxed when filing their income tax returns. It's normal for corporations to be taxed at the corporate level and for shareholders to be taxed when filing their income tax returns. The reality is that REITs already function like corporate landlords. This petition seeks to bring them in line with other corporations who already pay their fair share, and is recommended by third party experts similarly looking to address the housing crisis.
What do REIT profits even have to do with the housing crisis? You think the housing market is inefficient because it's too concentrated?
So crush existing owners with new supply. Incentivize building new market-rate infill until they're they're wailing and rending their clothing in the streets.
Redistributing from only the least likable existing owners (faceless rental housing mutual funds) to fund a means-tested band-aid solution seems unserious and performative.
Congrats for being like the only other person on this thread with basic tax knowledge.
Next up tomorrow, dont take a raise, you will be put in a higher tax bracket!
Lol.all this will do is mean every REIT will file to be a corporation. Overall tax rates wont change, barring tfsa non rich use.
Signed. Would suggest cross-posting in r/kitchener too.
I'm not active in that community since ~~some of the mods were~~ *one of the mods was* promoting transphobic misinformation and complaining about progressives. So I don't feel like I should post there, but if someone who does use r/kitchener wants to crosspost, that would be cool!
That's really disappointing to read. I'm not a very active redditor in general, but will post in r/kitchener and monitor how it goes.
Thanks for bringing attention to this petition, it's really appreciated.
Here's a sneak peek of /r/kitchener using the [top posts](https://np.reddit.com/r/kitchener/top/?sort=top&t=year) of the year!
\#1: [The fact that I have to video record every crossing I make at these roundabouts is insane.](https://v.redd.it/4cw48rd3s3h91) | [935 comments](https://np.reddit.com/r/kitchener/comments/wlu9cu/the_fact_that_i_have_to_video_record_every/)
\#2: [One way you can help address the housing crisis in our community](https://np.reddit.com/r/kitchener/comments/x7km85/one_way_you_can_help_address_the_housing_crisis/)
\#3: [I got bored and did a thing...](https://imgur.com/BGZYxpf.jpg) | [26 comments](https://np.reddit.com/r/kitchener/comments/s6orki/i_got_bored_and_did_a_thing/)
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Would you be ok with it being cross posted to /r/ontario ? Might be a good option to get more eyes on it.
Absolutely! And I'm glad to have different people sharing it so it's not just me cross-posting my own post everywhere!
/r/ontario doesn't allow for crossposting, so I created a new post with credit back to you and a link to this post, hope that's ok?
Really?! I only know of 2 active, one of which I'm quite sure wouldn't be the person you're talking about, but the other would definitely be that person, I don't know how they were allowed to be a mod. Since you're indicating multiple mods, I'd be interested in knowing who the other(s) were. Cheers.
That's my mistake, yes, it does seem that it was only one mod. Idk the situation with the Kitchener sub, but I've often found it to be more welcoming to NIMBYs and more bigoted folks, so I've tended to stick to r/waterloo, since it covers the whole region anyway.
Ah. No, no worries, understandable.
Would be a good step in a target rich environment.
Mike Morrice for prime minister! Signed.
At the very least he should dethrone the current goofy loser we have to call premier and take that spot! I've never met Mike but he seems like a decent, stand up kind of guy and we need more of those in charge.
Signed! Commenting for visibility
Signed. Comment for post bump.
No such thing as tax exemption.
Every dollar of dividends from a reit is taxed as income. No tax credits.
Doing this will only lower taxes investors pay in april through dividend tax credit that equalizes corporation and personal tax rates
Signed, an accountant that understands dividend tax credits and return of capital payments.
Thank you for posting this.
Signed and trying to have some optimism
wtf is Morrice doing, Ontario politicians aren't supposed to do this sort of thing, I thought they just guarded corporate and elite interests
Wow! Thanks so much for sharing this u/paris5yrsandage!
For anyone curious for more background on this petition - as well as a motion we’ve paired with it that you can ask your MP to support - see this post (there’s even a video summary at bottom if that’s more your thing): https://www.reddit.com/r/kitchener/comments/yrtfc6/update_on_petition_and_motion_to_help_address_the/
Mike, I appreciate that you are engaging in the community. There are several comments here regarding clear issues with this proposal that I hope you’ll address. REIT’s are first and foremost commercial property investment tools for the middle class. Commercial real estate as a highly profitable asset class has long been available only to the wealthy. Did any thought go into how this could actually widen the wealth gap by effectively destroying an asset class?
Hi u/OrdinaryCredit, for sure. There are several misconceptions that I’m seeing in replies here and in some spots the petition has been crossposted.
First, as mentioned in the post linked above, REITs are significantly growing their portfolios outside commercial real estate. Over the past several decades, REITs have expanded into acquiring and commodifying residential rental housing. While there are issues with disclosure, we know that they own nearly 200,000 residential units across the country (https://policyoptions.irpp.org/magazines/june-2021/the-rise-of-financial-landlords-has-turned-rental-apartments-into-a-vehicle-for-profit/).
Second, with respect to concerns about widening the wealth gap, this proposal follows the recommendation of groups like The Shift’s Directives – whose explicit focus is to reduce inequity. I link to their report in the original post, in which they recommend exactly what this petition is proposing (details here: https://make-the-shift.org/wp-content/uploads/2022/06/Directives-Updated-22-June.pdf). Another example is the Office of the Federal Housing Advocate, who, in a recent report, cited the following: “Government actions should include protecting the housing market from the extractive actions of large corporate investors and financial actors like Real Estate Investment Trusts.” (https://housing.chrcreport.ca/pdfs/office\_of\_the\_federal\_housing\_advocate-annual\_report\_2021.pdf)
Last, as for middle class investors: I’m happy to see them invest in the stock market if they’re looking for a financial return. But reports like those linked above are unanimous: treating housing like an asset class – including through investment trusts - is contributing to our housing crisis. REITs are multinational firms that are swallowing our housing stock and renovicting people across the country. The measures in this petition won’t solve the problem on their own, but it would move us in the right direction.
So your plan here is to eliminate REIT’s and have the ownership held by a corporation instead?
Done - thank you for posting.
thank you based mike
if you sign it don't forget to check your email to confirm
Signed and shared it with some family.
Plz share this to your circles. We can hit that 500 for sure!
All this bill does is eliminate a type of security available to investors and pension funds to invest in. I'm not sure that eliminating REITs will impact rent or residential housing prices but it definitely wont generate new tax revenue to fund low income housing. REITs dont eliminate tax revenue, just changes who pays. And REITs wont exist if this passes anyway. There is no way for the gov to track what "tax" is coming from general partnerships, which is what all this funds will becoming this passes.
100% the MPs that own / flip income properties will made this forward. Great to see democracy at work
Thanks for posting this.
As of now we crossed the 500 mark!!!
We did it reddit!
Fucking phone, hit wrong thing and have to start form over
You all understand that they are tax exempt because the share holders get 90% of the distributions... Not a bad idea though..