Wikipedia:Reference desk/Archives/Miscellaneous/2011 September 2

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September 2

Capital gains taxes

Hi, I was seeking stats on the breakdown of capital gains taxes by wealth or total income brackets in Canada. I'm not talking about any progressiveness of the tax rate, what I want is stats saying things like, of those who pay capital gains taxes the top 10 percentile pay 70% of all capital gains taxes collected.(wholey made up numbers) I need this numbers to show that a reduction in capital gains taxes means a much larger break for the rich than it would for the rest of the population who already pays little in capital gains as they are of course too poor too have capital. Any sources would be appreciated, even non-Canadian ones, I can't seem to find the stats myself. — Preceding unsigned comment added by 99.235.194.16 (talk) 02:45, 2 September 2011 (UTC)

Here are some data for the United States showing that the top percentile by income pay nearly three quarters of capital gains taxes. Here is an article stating that the top 0.3% by income in the United States report 61% of the capital gains income reported by all filers. This Canadian report shows that in 2004 Canadians in the top income quantiles received a much higher proportion of their income as capital gains than Canadians in the bottom 95 percentiles. Multiplying those percentages by the 2004 data in this article, you may be able to derive the proportion of Canadian capital gains received by different income quantiles in Canada. Marco polo (talk) 15:36, 2 September 2011 (UTC)

Thanks for your links, they were very helpful. I did calculate some numbers from the two papers to come to the fact the top 5% make 6x the income of the average person in the bottom 95%, and they make 21x* more in capital gains(excluding dividends/interest) than the average person from the bottom 95%. The top 1% make 75x* more in capital gains than the average person. I wanted to know this and hope others are interested too due to the fact the Tax-Free Savings Account is a new giant loophole for the rich to stop paying capital gains taxes in Canada. 99.235.194.16 (talk) 06:11, 3 September 2011 (UTC)

*edited to fix numbers 99.235.194.16 (talk) 05:10, 4 September 2011 (UTC)

TFSA becomes available at age 18, and assuming a Canadian retires normally at 65, they have 47 years to contribute to their TFSA. Even if they contribute the full $5000 each year, they only end up contributing $235000 over their entire lifetime. Hardly makes them "the rich" in my opinion.

Given the $5000 annual contribution limit, TFSA is inherently progressive. If a rich person invests $1,000,000 each year, only $5000 of that investment will be tax free. If a poor person invests $5000 each year, the entire investment will be tax free. So I fail to understand your position that TFSA is loophole for the rich.99.244.246.45 (talk) 00:17, 4 September 2011 (UTC)

It is clear from the stats that capital gains, and thus capital gains taxes are largely a feature of rich Canadians. Thus, any reduction in capital gains taxes would be a larger tax relief for the rich than for the poor, and thus a regressive move. It is also important to know that many of the rich already have millions in their TSFAs. This is because many purposely made massive overcontributions, waited for the capital gains, remove the principle to avoid overcontribution fees, but the profits were allowed to be left in the account. Also, the effective limit is more like $10,000/year for a married couple, as income transfer is fully allowed. So a couple with one income could deposit $470,000 into their accounts over 47 years, for an end figure of $2.06million(5.5% gr).

"If a poor person invests $5000 each year" - I'm not sure where you suggest a poor person gets $5000.... If poor people had an extra $5000 every year, they would be investing it, I mean a $1.03million retirement fund is very attractive, without even cutting into the principle they could withdraw $71,000/year. Poor people must be dumb for not doing something so easy as putting away a meagre $5000/year.

If the government wanted to increase savings they would have made the first $5k in capital gains tax free, which would have no effects on behaviour, serve all Canadians (only a percent of Canadians have TSFAs(waste of time when you pay $5/year in cg taxes)), and most importantly ensure no one is saving millions in cg taxes which TSFAs allow them to do. Instead the TSFA creates a way for the rich and professional investors to largely avoid paying capital gains. Imagine if Larry Ellison, Mark Zuckerberg, Andrew Carnegie, Warren Buffett, or many more had a TFSA, they would have never paid a dime in capital gains taxes.

Oh, and the TSFA does not advertise itself as for retirement as that is what RRSPs are for, it's meant to save people from paying capital gains tax so they can spend their profits immediately. There is no penalty for fast withdrawl, so no penalty for not using TSFAs to save. 99.235.194.16 (talk) 03:41, 4 September 2011 (UTC)

Simply, the richest 5% of Canadians by total income make more in capital gains than all other Canadians combined. Does a program with weak limits which reduces capital gaines taxes help the rich or Canadians. 99.235.194.16 (talk) 05:10, 4 September 2011 (UTC)

99.244.246.45 here. Sorry I forgot to login before.

The over-contribution loophole you mentioned was fixed within months of TFSA's introduction. I believe the loophole was due to gross incompetence on the government's part, not a conspiracy orchestrated by the rich. If it was indeed a conspiracy then it clearly failed since the loophole is now gone. Personally I think those who profited from this loophole should be prosecuted under the fullest extent of the law. Unfortunately that did not happen.

If you believe this loophole, or any other loophole within the TFSA, is still being exploited, please post evidence of this. I will forward them to the CRA. Until the evidence is delivered, I suggest we continue the discussion under the assumption that no Canadian have more than $15k + legitimate capital gains in their TFSA (all of my previous comments was made under this assumption).

Unfortunately I will not be able to respond to comments made under the erroneous belief that the loophole continues to exist.

"If the government wanted to increase savings they would have made the first $5k in capital gains tax free, which would have no effects on behaviour, serve all Canadians" Most Canadian have no capital gains at all, as your statistics have pointed out, so exempting the first $5k in capital gains would only be helping the rich. Personally speaking I have not made a single cent of capital gain in my life so this tax break would not help me at all. From your “$5/year in cg taxes” comment, I suspect you have a misunderstanding regarding what exactly is considered capital gains. Under the Canadian Tax code, interest from bank accounts are not considered capital gains.

If you're proposing to make the first $X dollars of interest earned tax free then I'm 100% behind that idea. Like you said it automatically benefits all Canadians and require no extra hassle. Anonymous.translator (talk) 15:55, 4 September 2011 (UTC)

Yes, I did mean capital gains, interest and dividends for the first $X amount being tax free. "If it was indeed a conspiracy then it clearly failed since the loophole is now gone." Not at all, those who took advantage of it already are not hurt by the closing of the loophole. If there was a reset of accounts that would have undone the exploitation, but there was no reset.

Prime Minister Stephen Harper promised to double the annual contribution limit to $10,000 once the federal deficit is eliminated.(Not the $567 billion debt paid off, just the yearly deficit) This of course means $20,000 per couple per year, or $4.1million after 47 years. Do you think the average Canadian family has an extra $20,000 every year they can put away in savings after they already use RRSPs and RESPs. Are poor and middle class Canadians suppose to save $10,000 each before or after they pay off their $78billion in credit card debt. Who benefits more from paying 0 tax more, someone paying a 10% tax (middle class) or those woh would be paying a 23% tax (rich class)? 99.235.194.16 (talk) 19:21, 4 September 2011 (UTC)

I did not know that the accounts were not reset. Thank you very much for bring that up. This sounds extremely serious and yet none of the websites I googled mentioned it at all. All of them just talked about how the loophole was closed but mentions nothing about the tax evaders who profited and continue to profit from their crimes. Do you have source for this anywhere? I'd like to add it to the TFSA article.

I agree that it would be unfair to increase the annual contribution limit any further. Unfortunately this is part of Harper's platform and he won the last election, so there's little we can do to stop him until the next election.

Will the results of your research be put online or be published anywhere? I would very much like to read it. I found it alarming how most Canadian don't know about these loopholes, and I'm ashamed to admit that I myself did not truly understand the ramification of these loophole. The first step in stopping TFSA abuse is raising public awareness and I applaud your efforts so far.Anonymous.translator (talk) 20:57, 4 September 2011 (UTC)

Hmmm, might be hard to find a source that there wasn't a reset, kinda like finding a source saying a major earthquake did not happen yesterday in Toronto... Of all the papers and forums I've read on TFSAs and the loopholes I've never heard a word about a reset, so I am assuming it never happened. There are still more loopholes that are open, one great loophole is that I could give you a loan of $5,000 at 60%/year (legal maximum I believe) and I could place that loan in my account and really rise my TFSA fast. At the same time you would give me the same loan from your TFSA and I would pay it from my non-TFSA account, so we both break even while we are both pouring own money into our TSFAs.

I am writing a political book, hopeing to be done the ~250page book in a month maybe two, than find a publisher. The book will go over many easy to solve problems Canada has in a bipartisan fashion. Another economic problem that is little known are Interchange fees which create a deadweight loss of $4.5billion/year for Canadian retailers. Maybe I'll post of your wall when I'm my book is available for purchase :D. Public awareness (talk) 22:10, 4 September 2011 (UTC)

The cross loaning is variation of this scheme: "Dick invests $5,000 of his TFSA in private company shares of which he is a significant shareholder (he owns more than 10%). These shares are a prohibited investment for a TFSA. The company subsequently declares a $1-million dividend on the shares held by the TFSA.".

Have you considered submitting a FIOA request to the CRA? Sounds like your work need some primary data in order make an impact. The financial sector certainly won't diverge any data to you since they're the ones making a killing out of these loopholes. If the FIOA request reveal, for example, there are X TFSA account over a million dollars, then that would have a huge impact on the public mind. I believe most Canadians, like myself, naively believe the maximum on all TFSA account is 15k + capital gains, and that all loopholes have been corrected (not just closed, but retroactively taxed).Anonymous.translator (talk) 22:43, 4 September 2011 (UTC)

Morning after pill's effect on fertility

how soon after taking a morning after pill will you become fertile in optimum cercumstances? — Preceding unsigned comment added by 76.14.123.31 (talk) 07:00, 2 September 2011 (UTC)

You should be asking your doctor or gynaecologist about this, not random strangers on the internet. --Viennese Waltz 07:39, 2 September 2011 (UTC)

The various types of morning-after pill are described in the article Emergency contraception. Some side effects after use are noted but not the effect on fertility. A source states that side effects generally resolve within 24 hours. Temporary disruptions of the menstrual cycle, i.e. the normal fertility cycle, such as delayed ovulation and/or unusual bleeding within 7 days may occur but the subsequent cycle is not significantly affected. What the OP calls optimum circumstances depend on whether one (not me and not you) is trying to get pregnant or not to get pregnant. Cuddlyable3 (talk) 08:59, 2 September 2011 (UTC)

Sorry for calling you out specifically Viennese Waltz, but there are too many unhelpful and arrogant answers on the reference desk and it needs to stop. The op was asking for general knowledge and there was no sign the op had taken, thought about taking, or administrating the pill, they could be writing an essay on it for a class. 99.235.194.16 (talk) 06:18, 3 September 2011 (UTC)

Also, getting pregnant is not usually considered an illness, so I'm not sure the prohibition on medical advice really applies. --Tango (talk) 11:23, 3 September 2011 (UTC)

I support Viennese Waltz's response as reasonable because emergency contraceptive pills are usually prescribed by a doctor who takes responsibility for selecting the pill type and considering after-effects, all based on knowledge of the lady that we don't have. It was a well intentioned response and it has not stood in the way of other informative responses. Cuddlyable3 (talk) 12:05, 3 September 2011 (UTC)

Without regard to whether the medical advice reply was proper or not - at least in the U.S., anyone over 17 has access to emergency contraceptive pills over the counter, without a prescription or doctor's care. ^Avic_ennasis @ 12:33, 4 Elul 5771 / 12:33, 3 September 2011 (UTC)

I'm not really sure why you believe something has to relate to an illness to be medical advice Nil Einne (talk) 17:05, 3 September 2011 (UTC)

Indeed, Nil. Pregnancy per se is not an illness but it is certainly a medical condition that only doctors/gynaecologists are qualified to manage. -- Jack of Oz ^{[your turn]} 21:24, 3 September 2011 (UTC)

Women have been successfully managing their pregnancies all by themselves ever since there were women! It's only in the last couple of centuries that the medical profession have dirtied their hands with it. --TammyMoet (talk) 13:03, 4 September 2011 (UTC)

Sure, in the "good old days" a lot of women gave birth to healthy babies with no special help and no particular complications. But what was the mortality rate back then, Tammy? A lot higher than it is these days, that's for sure. Babies often died, mothers often died - it was potentially a very grim situation, not an occasion of joy. But we're dealing here with a request for pregnancy-related information, which for very good reasons we are not going to provide. We have directed the OP to a doctor or gyno, who are best qualified to give such information.

As for the medical profession "dirtying their hands" etc, apart from being a rather grotesque comment, let me ask you this: If you encountered a pregnant woman who was experiencing some internal pain, would you get medical help or advise her to get some, or would you tell her that she's a woman and can handle it herself? -- Jack of Oz ^{[your turn]} 13:39, 4 September 2011 (UTC)

(ec) Successfull? - do you include all the women and babies who have died in childbirth of complications? By themselves? - is that how interventions such as a caesarian or episiotomy are done to save the lives of mother and/or child? Medical profession? - what are midwives? Dirtied hands? - are the natural byproducts blood, amniotic fluid and a placenta that came from your mother at your birth "dirt"? While TammyMoet's little post may aim to promote the risky Home birth movement, it is irrelevant to the OP's subject of medicinal intervention to prevent pregnancy, which has not been available "ever since there were women", many of whom in early times didn't even know how they managed to get pregnant. Cuddlyable3 (talk) 13:44, 4 September 2011 (UTC)

FWIW, I (admittedly a mere man) understood TammyMoet's "dirtying their hands" to imply that the (Western) medical profession (then almost exclusively male) once distained involvement in pregnancy and childbirth, leaving it up to midwives (without formal establishment-approved training), and only took it over (to the near-exclusion of those non-establishment experts for a time) when it became lucrative to do so - a comment on the veniality and prejudice of the former male-dominated profession, not on childbirth itself. {The poster formerly known as 87.81.230.195} 90.200.79.243 (talk) 15:00, 4 September 2011 (UTC)

You may find this site illuminating, and the article Doula. I base my remarks on my study of a matter which has both involved and interested me over the years. --TammyMoet (talk) 14:45, 4 September 2011 (UTC) and fixed link --TammyMoet (talk) 14:46, 4 September 2011 (UTC)

Photography tips

Hi, I am heading to Lanzarote next week for a holiday and I am a very amateur photographer using a DSLR, with the sunshine would I need any type of filters to prevent my photos from being overexposed? Or have you any other tips I could use to prevent this from happening. 46.7.175.157 (talk) 13:47, 2 September 2011 (UTC)

I don't use a filter and haven't had problems with my DSLR while photographing the sun-washed outdoors in the American West. A couple of tips are 1) Don't photograph while facing toward the sun. If you want to photograph an object, try to stand with the sun at your back or over your shoulder. 2) Make sure your camera is focused on the object you want to photograph. Also, if your camera has settings for different types of light, use them. For example, I have a setting for "beach" photography which I've found works well for well-lit outdoor photography on cloudless or mostly cloudless days. There is a setting for portraits that works well for well-lit portraits. There is a setting for foliage that works well under the shade of trees, and so on. Also, my camera has a macro setting that works well for close-up shots of wildflowers and such. Marco polo (talk) 14:33, 2 September 2011 (UTC)

Unless you're shooting in full-manual mode or deliberately setting extremely long exposure times, any modern camera will automatically adjust aperture, exposure, and/or ISO speed for approximately correct exposure of daylit subjects. Where you may encounter difficulties under bright sunlight is when the sky is very bright but the objects you're interested in on the ground are in shadow (or under weaker illumination); the camera's light meter may 'guess' wrong about what part of the image – sky or ground – to expose correctly. Under such circumstances you may wish to investigate how to set your camera's exposure compensation (or EV); positive values correspond to more exposure and brighter images.

The other challenge arises when you have subjects with mixed light and shadow; if you're shooting something that has very high contrast between its light and dark areas it can be very difficult to produce a technically acceptable shot no matter what settings you use on your camera. Your camera may also have settings for automatic exposure bracketing; this takes a series of three or more images sequentially: one 'correctly' exposed, one 'underexposeed', and one 'overexposed'. After you get home, you can pick the one you like, or (if you're feeling ambitious) you can combine the best parts of all three pictures.

As Marco polo notes, pointing your camera at the sun can be bad for your image quality and for your eyes. The camera's metering will tend to guess wildly wrong if you point your camera at the Sun.

No filters are required, though many photographers buy an inexpensive UV filter to put on the end of their lens purely for physical protection. (If something pokes your lens, it takes out the cheap UV filter rather than scratching the expensive lens.) Pros may use a graduated neutral density filter (a filter that is dark at the top and fades to clear at the bottom) when shooting landscapes and other pictures that have a big field of brightly lit sky; for the casual or amateur photographer, this is more trouble than it's worth, and you can often achieve nearly the same effect in processing after you get home. (Even free tools like Picasa let you do it in one or two clicks. Similarly, such tools can also allow you to repair moderate over- or under-exposures and tweak image contrast and color saturation, among many other little touches.)

You can sometimes get interesting effects using a polarizing filter. Used judiciously, it can increase the blueness of the sky, improve the appearance/contrast of clouds, reduce the shinyness of green leaves, and suppress (or enhance for effect!) reflections in glass or water. Be warned that wide-angle shots of the sky can look weird, as different parts of the sky have different degrees of polarization.

In all cases, try out these features and filters at home before you leave on vacation, so that you have at least some idea of what to expect and how to use them. Don't be afraid to experiment, but don't put yourself in a situation where you're missing shots (or annoying your travelling companions) because you're busy fiddling with gadgets. TenOfAllTrades(talk) 15:10, 2 September 2011 (UTC)

Fit a Lens hood. It reduces glare and lens flare, and provides some physical protection for the lens. Cuddlyable3 (talk) 21:43, 2 September 2011 (UTC)

I don't know about the sensitivity of modern digital sensors to UV. For classical film, a Skylight filter or a UV filter was recommended to reduce the effect of scattered UV, which tended to lead to washed-out pictures. Ever since I went digital, I only used compact cameras, and have had great sky images e.g. from the US and Australia without any extra filters. --Stephan Schulz (talk) 12:45, 3 September 2011 (UTC)

The optics in any modern digital camera generally do a quite adequate job of filtering out UV already; in line with your experience, there's no real image-quality reason to require a UV filter these days. The major reason why many photographers still use UV filters isn't to improve photo quality but instead to protect their lenses. In inclement weather, the filter protects the front lens element from rain, snow, or mist (as well as reducing the condensation problems one sees moving from air-conditioned cars and hotels into hot humid weather); is easier to remove and clean if it becomes dirty or smudged; and provides a measure of sacrificial mechanical protection if the lens is dropped, poked, or attacked. (If something happens to the UV filter, you're only out $50, and you can unscrew it and continue shooting.)

If you generally leave a sacrificial UV filter in place, remember that it has some limitations, and there are circumstances where you might wish to remove it. These apparently-clear filters will absorb and reflect a small amount of visible light; depending on the filter, you'll lose between 5 and 15% (up to about a quarter stop) of the total light coming into your lens. Under virtually all circumstances this is a negligible effect in terms of getting properly-exposed shots—of more concern is where that light goes. The extra filter provides two more surfaces from which light can reflect, producing unsightly flares under unfavorable conditions (photographs with small, intense light sources against muted backgrounds are most prone to this sort of problem). There can also be problems with vignetting (generally only with the widest-angle lenses, or when stacking more than one filter at a time); the rim of the filter stack can dim or even crop off the corners of the image. Stacking multiple filters also increases greatly the likelihood of flares and ghosting, as light can reflect inappropriately off of all the extra filter surfaces. (Here's an amusing blog entry that demonstrates the effects of filter stacking. TenOfAllTrades(talk) 16:13, 3 September 2011 (UTC)

Under normal sunlight you never get an EV / exposure value > 15. This EV corresponds to aperture f16 and shutter speed 1/100 (sunny 16 rule, if you have set the DSLR to an ISO of 100). In specific environments of high albedo (the sea, snow or sand reflecting sun light) you may get to 16, anything higher does not exist outside a studio. In either case (f16, 1/100) you have ample scope to either close your aperture or tweak your shutter speed. If your camera allows you to view the histogram of the frames, that may be of help.

Most current DSLRs also allow you to bracket your shots, this meaning that you you set the preferences in the camera´s menu to take 3 (or even 5) shots in rapid succession. The "middle" one is exposed "correctly" according to the set (manual or automatic) aperture and shutter speed. The other 2 (or 4) are underexposed / overexposed by an EV step (generally the options are 1/3, 1/2 and 1) you can set in the menu. Normally, this guarantees that one of the 3 (or 5) shots is properly exposed. Delete "unwanted" frames to reduce the space taken on the memory card.

If you take photos with significant contrast, eg a townscape though a dark doorway, this method also allows you to do the required post-processing by "combining" (dodging / burning in) the parts of the shots which are correctly exposed.

As has been mentioned above, the most important gadget is a lens hood. The second most important tool is common sense, ie take your shots from a location where the glass is in the shadow of a building, a tree or a conveniently positioned human volunteer to avoid lens flare. --Cookatoo.ergo.ZooM (talk) 11:14, 4 September 2011 (UTC)

Correctly exposed and infocus pictures are fine but one thing that no one has mentioned yet is to take care with the composition of your photographs. Read up on things like the rule of thirds, depth of field (ignore the unncecssarily complex last 3/4 of that article), and taking care over framing to exclude unnecessary distractions such as overhead cables. Hopefully you will get some memorabl photos. Good luck. Astronaut (talk) 14:51, 4 September 2011 (UTC)

I second what Astronaut said about the law of thirds. It's easy - Don't put interesting things in the middle of your picture. Put them a little off to the side. It'll make your photos look more intentional and composed, which goes a long way. Depending on what kind of camera you have, you may have specific settings like "sports mode" or "fireworks mode". Spend a little time reviewing what these settings can do before you go. A third tip - Take a LOT of pictures. If you only take one picture of Landmark X and it doesn't turn out, you'll be bummed. If you take five of them while scrolling through different camera settings, one of them may be majestic. Hope that helps! Foofish (talk) 04:55, 7 September 2011 (UTC)