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Keep It Simple S…ubsidy

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9 minute read

You want my idea for the wage subsidy… well here it is.

WARNING: It is so simple to implement, there is no way a government would do it.

(Originally posted on LinkedIn (no joke) April 1, 2020)

 

 

People have said “you are quick to pick apart the wage subsidy, so what is your solution?”

So… you asked for it… here it is:

I’ve said it from the very beginning that it should resemble EI support. All they should be doing is simple.

(No this is not an April Fool’s joke… but I am hoping the Press Conference on April 1, 2020 by the Minister of Finance was)

I was fine with EI amounts… but since we have the Canadian Emergency Response Benefit (CERB)… let’s use that amount to keep it more simple.

The amount is this:

(just like the CERB). $2,000 per worker per month, taxable, and no withholdings up front

Put a ‘clawback’ amount on those that are getting it like the clawback on Old Age Security or regular EI benefits for when they file income tax next year.

The 3-prong approach to the subsidy

 

Prong 1 – CERB from Service Canada

Everyone should get it. Yes, everyone.

However, anyone that makes more than the EI maximum in 2020 must pay back 30 cents of the CERB on every dollar over the $54,200 EI maximum threshold when they file their 2020 taxes.

So when you file your personal 2020 income tax, if you ended up making more than $80,667 in income, you will have had to pay back the full $8,000 of CERB received on a T4E.

This results in helping everyone today, help jump start the economy when we need to and have those that get back on their feet quicker, paying some or all of it back.

If you received both the CERB from Service Canada, and the CERB through your employer, you have to pay back the amount greater than the $8,000 received, and then any other amount based on the formula above.

This will prevent or reduce the double dip.

 

Prong 2 – CERB through the Small Business employer

The small business (less than $15M in assets of all associated corporations) employer would also get the CERB on a per-employee basis. They already have to fill out the number of employees when they file their remittance forms, so what’s the difference?

This $2,000 flows through to subsidize the wages, and must be paid to the employees. You create a different box number to track it on the T4 slips next year for audit purposes and to make sure the employee got the money.

I know this isn’t 75%, but the 75% was a capped amount anyways. That’s why I said keep it simple.

In order to incentivize the small business employer so they don’t lay them off, treat it as a flow through, and non-taxable to the employer.

So if there are five employees at the small business, the employer will get $10,000 of CERB to flow through to the employees.

The employee’s wages will be subsidized by the $2,000 amount, and they will put the $2,000 in a different box on each T4 slip for tracking purposes.

In order to incentivize the employer to act as the flow-through for Service Canada, this $2,000 will not be subject to EI or CPP by the employer and will not be included in the taxable income of the employer.

This allows the employer to claim the full wage deduction, have subsidized payroll costs, and save the income tax amount by deducting the full payroll.

By not counting it as income, this tax and remittance savings can be viewed liked an “admin fee” for acting on Service Canada’s behalf.

On $10,000 (5 employees) this would save up to $252 in Employer EI, $525 in Employer CPP, and $900 in federal income tax.

Cost to government for employer being the administrator instead of Service Canada: $1,167.

Incentive for employer to NOT lay off the staff, $10,000 in wage costs… and $1,167 in tax savings.

 

Prong 3 – CERB through Large Corporations

If the employer is getting the CERB on a per-employee basis and they are a large (greater than $15M in assets) corporation or associated group, allow them to not pay employer EI or CPP on the CERB.

100 employees = $200,000 = up to $5,040 in reduced EI, and $10,500 in reduced CPP remittances as the incentive.

So the employer gets $2,000 per employee as a subsidy to cover wage costs, and does not have to do payroll withholdings on the amount, saving them a total of $200,000 + 5,040 + 10,500 = $215,540.

Or put another way, they can save $15,540 by not laying them off.

If that’s not enough incentive, then perhaps look at it being only 50% taxable, which in the example above, would reduce Federal income tax by $15,000 (using 15% general rate x 50% x $200,000)

 

 

Audit Tracing

By simplifying the process, there is less ability for abuse.

Service Canada will issue everyone a T4E with the CERB they personally received from them (no application necessary).

T4 box numbers can be reconciled by CRA on slip filing to amounts of CERB received by the employer through the PIER system.

Those same boxes can be reconciled to specific individuals on tax filings to see if there were any that should repay.

Amounts greater than $8,000 received by anyone will need to be repaid.

Those with income over the EI Maximum amount, will have to repay some or all of the CERB back when they file.

If you don’t agree… well… the specific repayment formula can be figured out later… we have a year for that. We need the money in the public’s hands now though.

 

In Conclusion

These incentives and recapture mechanisms will reduce the likelihood of layoffs in low-margin industries like hospitality since $2,000 a month goes a long way to covering those wages; it will “Flatten the EI Curve” (trademark pending – not really… but I like saying it)

It would get everyone back working quicker after this is done by maintaining the connection to employers, and get the economy kick-started with cash injections at the front of this thing, rather than the end.

In the end… you have employers flowing the $2,000 through to the employee on Service Canada’s behalf as a no-withholding amount and a nominal cost to the employer to administer it, rather than Service Canada processing hundreds of thousands (if not millions) of individual applications.

If they are a small business, they actually get a tax savings by being the administrator and helping Service Canada in the process.

If they are a large business, they can have a good chunk of payroll costs reduced by not having to pay EI and CPP on the amount, and perhaps tax savings.

In the end, every worker gets $8,000 over 4 months just to buy everyone time and we have Flattened the EI Curve.™

Biography of Cory G. Litzenberger, CPA, CMA, CFP, C.Mgr can be found here.

#RedDeerStrong – If you’re struggling and you need to consolidate debt through a mortgage refinance, Kristen is here for you.

CEO | Director CGL Tax Professional Corporation With the Income Tax Act always by his side on his smart-phone, Cory has taken tax-nerd to a whole other level. His background in strategic planning, tax-efficient corporate reorganizations, business management, and financial planning bring a well-rounded approach to assist private corporations and their owners increase their wealth through the strategies that work best for them. An entrepreneur himself, Cory started CGL with the idea that he wanted to help clients adapt to the ever-changing tax and economic environment and increase their wealth through optimizing the use of tax legislation coupled with strategic business planning and financial analysis. His relaxed blue-collar approach in a traditionally white-collar industry can raise a few eyebrows, but in his own words: “People don’t pay me for my looks. My modeling career ended at birth.” More info: https://CGLtax.ca/Litzenberger-Cory.html

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Why FDA Was Right To Say No To COVID-19 Vaccines For Healthy Kids

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From the Daily Caller News Foundation

By Monique Yohanan

The FDA’s decision not to authorize COVID-19 vaccines for healthy children has drawn criticism. Some argue: If parents want the shot, why not let them get it for their kids? That argument misunderstands what FDA authorization means — and why it exists.

The FDA often approves drugs that carry risks or have imperfect evidence of effectiveness. This is a tradeoff we sometimes accept for people who are ill: when someone is already sick, the alternative is untreated disease. Vaccines are different. They are given to millions of healthy children. This requires a higher standard, not just evidence for safety and immune response, but clear, durable clinical effectiveness. Approval for optional use isn’t neutral; once the FDA authorizes a vaccine, it carries the full weight of institutional endorsement.

Measles provides an example for how the FDA approaches vaccine approvals. Before the measles vaccine was introduced in 1963, the U.S. saw 3 to 4 million infections, ~48,000 hospitalizations, ~1,000 cases of encephalitis, and 400-500 deaths each year. Infants bore the brunt of the most severe outcomes.

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That created a natural instinct: why not vaccinate the youngest and most vulnerable? The initial measles rollout was to 9-month-olds, but within two years that timing was changed to children who were at least 1 year of age. This was not because younger babies were not at risk or that the vaccine was riskier for them, but because it just didn’t work well enough to justify a universal campaign.

The knowledge of the particular risk younger infants face has led to continued research on the effectiveness of measles vaccination in that group. A 2023 trial of the combined measles/mumps/rubella (MMR) vaccine in infants aged 5-7 months, and subsequent safety and immune studies in 2024 and 2025, produced consistent results—safety and the ability to generate antibodies were demonstrated, but a durable response and protection against hospitalization were not.

That is why the FDA does not approve MMR for routine use in healthy children younger than 12 months of age. It is also precisely why getting back to herd immunity for measles is so essential: the youngest infants can only be protected if the rest of us are immunized.

What’s the evidence for COVID-19 vaccination in infants and children? It generates robust antibodies, often higher than in adults. But clinical benefits are modestshort-lived, and inconsistent. It is nowhere near the level of proof U.S. regulators require before making a vaccine universally available to healthy kids.

Some argue that even if benefits are modest, parents and pediatricians should be free to choose. But FDA authorization is not about personal preference; it is a stamp of approval for more than 70 million healthy children. Statistical safety is not enough. At that scale, even rare risks mean real harm to real children. COVID-19 vaccines were originally authorized in the hope that immune responses would translate into population-level benefits. For healthy children, the initial optimism sparked by early encouraging signals has steadily given way to three years of disappointing clinical results.

The lessons from measles are clear: safe but minimally effective isn’t enough. We don’t authorize MMR for 5-month-olds, even to parents who might want their children to get it. COVID-19 vaccines for healthy children should be judged similarly. This is not because there is a lack of any benefit, but because it doesn’t rise to the level we use for other vaccines. Only if and when proof of clinical effectiveness becomes available should authorization be reconsidered. At this time, the FDA is right to say no.

Monique Yohanan, MD, MPH, is a senior fellow at Independent Women, a physician executive and healthcare innovation leader, and Chief Medical Officer at Adia Health.

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COVID-19

The Persecution of Canada’s “Other” Freedom Convoy Truckers

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While thousands of serious criminal cases across Canada are dropped merely due to delays, many Convoy-related prosecutions on trivial charges continue more than three-and-a-half years later. The cases of Freedom Convoy truckers (left to right) Bern Bueckert, Clayton McAllister and Csaba Vizi (whose Volvo is shown at bottom) are still not fully resolved. (Sources of photos: (top left and right) screenshots from documentary Unacceptable?; (top middle) ThankYouTruckers.Substack; (bottom) Donna Laframboise)

By Donna Laframboise

On September 8, three and a half years after the 2022 Freedom Convoy departed Ottawa, and five long, stressful months after his trial actually ended, Robert Dinel walked out of court a free man.

Dinel, a Quebec heavy equipment operator who’d behaved entirely peacefully during the protest over Covid restrictions, had been charged with mischief and obstruction of police. Court proceedings were repeatedly delayed — four times alone just this year — until judge Matthew Webber of the Ontario Court of Justice finally stayed the charges on the grounds that Dinel’s Charter rights to a timely trial had been violated.

For Dinel, it was a relief. For Canadians concerned about freedom and justice, his legal ordeal was yet another example of a system gone off the rails.

Most Canadians are aware of the trials of convoy leaders Tamara Lich and Chris Barber, which ended in conviction; they are to be sentenced in October. Few may realize that many more protestors were charged, most for the relatively innocuous infraction of mischief, and have had their cases drag on and on through the courts for more than three years.

The record of Canada’s legal system clearly shows that mischief charges are routinely withdrawn before scarce and expensive court time is expended on relative trivialities. But when it comes to the truckers, the Crown attorneys at the Ottawa courthouse – employees of the Government of Ontario, not the federal government – appear to have lost all perspective. They are on a mission. The sheer intensity of the prosecution of Convoy members looks less like the fair administration of justice than revenge upon people who dared protest the arbitrary and oppressive measures of the Covid years.

The initial police crackdown itself was a mess. Those arrested were passed from police officer to police officer. Officials writing up the paperwork had no direct knowledge of what had actually transpired; extra charges appear to have been tacked on willy nilly. In Dinel’s case, the prosecution doesn’t even know the identity of the tactical officer who pointed a gun at his head and hauled him out of his vehicle on February 18, 2022.

In a police processing trailer four hours after his arrest, Dinel received a medical assessment from a paramedic. Seated and hand-cuffed throughout, the five-foot-three Dinel calmly and repeatedly told police he was in no fit state to be making decisions and that he wanted to speak to a lawyer. “I want to know what I’m signing,” he insisted. But the police officers, who outnumbered him ten-to-one, kept pushing him to sign an undertaking that he wouldn’t return to the protest area. The fact he never got his phone call – that he was denied his Charter right “to retain and instruct [legal] counsel without delay” – should have stopped this case in its tracks. The Crown chose to pursue it, anyway.

A week after Dinel’s mother died in July 2023, he suffered the first of four strokes. In December 2023, one occurred in the courtroom. “My whole face just seized up,” he recalls. “I had another stroke. My whole face drooped, then the judge freaked right out.” An ambulance was summoned and his trial was adjourned. “I hate court,” says Dinel. “It’s hard, you know. It’s stressful, it’s exhausting.” Rather than staying the charges on  compassionate grounds, the prosecution continued, with Dinel accompanied by a service dog.

Nova Scotia trucker Guy Meister spent hours in the same paddy wagon as Dinel the day they were arrested. After travelling from his Nova Scotia home to Ottawa for court appearances more than a dozen times – at considerable expense – in May of this year Meister was found guilty of mischief, but not of obstructing police. In late July, he was sentenced to 20 hours of community service, six months’ probation, and ordered to pay a $100 victim surcharge.

The trial for Windsor, Ontario trucker Csaba Vizi began just this month, the same day Robert Dinel’s charges were stayed. Video broadcast around the world in February 2022 shows him being assaulted by multiple police officers after he’d exited his truck and knelt down in the snow with his hands behind his head. None of those officers were themselves charged following this violence. None were forced to raise tens of thousands in lawyers’ fees, as Vizi has. Even protesters who have endured the stress of a trial and been acquitted have still not always walked free and clear, because the Crown has often insisted on filing appeals. As a result, defence lawyers routinely advise Freedom Convoy protesters that their legal nightmare isn’t actually over until an additional 30 days have come and gone. In one instance, the Crown waited until the last afternoon of the last permissible day to file its appeal.

These are just a few examples of what’s been going on in Canada’s justice system, one already beset by long delays for cases involving far more serious crimes. Credible news reports suggest that the majority of criminal cases in Ontario aren’t even making it to trial, with sexual assault
charges dropped because of delays. Yet the Convoy prosecutions continue.

Many people insist Covid is over, that we should all move on. But the legal persecution of the truckers who bravely protested government overreach in the bitter winter of early 2022 is far from over.

Donna Laframboise is an independent journalist and photographer. A former vice-president of the Canadian Civil Liberties Association, she is the author of Thank You, Truckers! Canada’s Heroes & Those Who Helped Them.

The original, full-length version of this article was recently published in C2C Journal.

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