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Key tax changes in 2024 in Canada

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Some tax changes this year are increasing costs for Canadians, including one that a tax specialist says could be the “last winter storm of the season that really turns things upside down.”

From higher income taxes to alcohol taxes, here are some important tax changes this year that Canadians should know about.

FEDERAL INCOME-BASED TAXES

The Canadian Taxpayers Federation highlighted some important tax measures in its reportreleased in December 2023. It said almost all Canadians will pay higher federal income taxes this year because of changes to Canada Pension Plan contributions and Employment Insurance premiums. The Ottawa-based not-for-profit citizen’s group says it’s committed to lowering taxes and keeping the government accountable.

While workers making $30,000 will pay $9 more in 2024, people earning at least $80,000 will pay $347 more, the federation says.

EMPLOYMENT INSURANCE

The federal employment insurance rate and maximum annual insurable earnings have increased this year from 1.63 per cent for $61,500 in 2023 to 1.66 per cent for $63,200 in 2024 for employees. This means that employees must pay a maximum annual premium of $1,049.12.

For employers, the rate rose from 2.28 per cent in 2023 to 2.32 per cent this year, so they must now pay a maximum annual premium of $1,468.77.

For Quebec residents, the EI rate rose from 1.27 per cent for $61,500 to 1.32 per cent for $63,200. Quebec employees must pay a maximum annual premium of $834.24 in 2024. For Quebec employers, the rate grew from 1.78 per cent to 1.85 per cent, making their maximum annual contribution $1,167.94.

Since 2018, EI for employees and employers has risen by $191 and $267, respectively, according to the Canadian Taxpayers Federation.

CARBON TAX SET TO CLIMB

The federal carbon tax will increase to $80 per tonne from $65 per tonne on April 1, 2024. The carbon tax applies to all taxpayers except those in Quebec. As a result, the price per litre of gas climbs to 17.6 cents from 14.3 cents. That will cost a family about $12.32 each time they fill a 70-litre minivan, the federation said.

Meanwhile, Canadians living in provinces using the federal carbon tax began receiving carbon pricing rebates Monday from the federal government’s Climate Action Incentive payment. The rebates depend on the size of the household and are given every three months.

ALCOHOL TAXES

Starting April 1, 2024, the excise tax on beer, wine and spirits will be up 4.7 per cent because of the alcohol escalator tax. The increase will cost taxpayers about $100 million this year and next year, the federation said.

DIGITAL SERVICES TAX

The Canadian Taxpayers Federation says consumers can expect to pay higher prices because of a new three per cent digital services tax that aims to get tech giants such as Amazon, Uber and Facebook to pay their fair share of taxes. The tax would apply to businesses with annual worldwide revenues of at least 750 million euros and annual Canadian digital services revenue greater than $20 million.

The Deputy Prime Minister’s Office wasn’t able to confirm the timing of this change by publication, though the Liberals’ spring budget confirmed they planned to implement it.

The federation suggested businesses would transfer the tax to consumers. It cited a Tax Foundation report that assessed the impact of the tax in France, predicting that about 55 per cent of the total tax burden will be passed on to consumers, 40 per cent to online vendors and only five per cent to digital companies.

HIGHER INTEREST RATES FOR LATE TAXES

The interest rate charged on late taxes, Canada Pension Plan contributions and employment insurance premiums will rise to 10 per cent from nine per cent.

John Oakey, vice-president of taxation at the Chartered Professional Accountants of Canada in Toronto, said the interest rate applies to any personal income tax balance left unpaid after April 30.

“Paying tax instalments and income tax balance on time is very important to avoid the interest charge,” Oakey said in an email to CTVNews.ca.

HOME OFFICE EXPENSES

For home office expenses, the Canada Revenue Agency’s (CRA) flat rate of $2 per day throughout 2020 to 2022 is no longer active for the 2023 taxation year, Oakey said. He said the temporary flat rate method was initially meant to make it simpler to deduct home office expenses during the pandemic.

Employees must use the detailed method and obtain a completed Form T2200 signed by their employer to claim home office expenses for 2023, according to the CRA.

Employees who were required to work from home are generally eligible for home office expenses that were directly related to their work, the CRA said on its website. They must meet conditions, such as working from home more than 50 per cent of the time for at least four straight weeks in the year. Home office expenses reimbursed by the employer are excluded.

WIDER TRUST REPORTING RULES

Caitlin Butler, a Vancouver-based tax specialist and director of tax education and publications at Video Tax News, noted the expansion of trust reporting rules is a big change that will affect many taxpayers.

“These changes will impact many individuals and businesses, many of whom may not even realize they should file a trust return,” Butler said in an email to CTVNews.ca.

She said required reporting has been expanded to include situations where a trust acts as an agent for its beneficiaries, often referred to as a bare trust. “In plain English, this occurs when the person on title or holding the asset is not the true beneficial owner but rather holds the asset for the benefit of another party,” she explained.

Examples include if a parent is on title of a child’s home – without the parent having beneficial ownership – to help the child obtain a mortgage, or a corporate bank account is opened by the shareholders with the corporation being the beneficial owner of the funds.

Butler said people need to find out if they are on title or holding an asset for which they are not the true beneficial owner. For example, she said they should determine if they get the benefits of the asset – such as proceeds on the sale of the asset – and if they are liable for the costs or risks of the asset, including property taxes.

“If a person is on title but not the true beneficial owner, there is likely a bare trust arrangement, which may require a trust filing due April 2, 2024,” Butler said. “This will be a massive exercise in compliance with the significant risk that many individuals and businesses will unknowingly not comply with the law. … This could end up being that last winter storm of the season that really turns things upside down.”

Many affected by the rules won’t owe more tax, but for the most part, they will have to pay compliance costs, such as paying a professional adviser to complete and file the trust return, she said.

If they don’t comply, the penalty could be $25 per day every day that the returns are late, up to $2,500, she added.

With files from CTVNews.ca Writer Natasha O’Neill and The Canadian Press

 

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STD epidemic slows as new syphilis and gonorrhea cases fall in US

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NEW YORK (AP) — The U.S. syphilis epidemic slowed dramatically last year, gonorrhea cases fell and chlamydia cases remained below prepandemic levels, according to federal data released Tuesday.

The numbers represented some good news about sexually transmitted diseases, which experienced some alarming increases in past years due to declining condom use, inadequate sex education, and reduced testing and treatment when the COVID-19 pandemic hit.

Last year, cases of the most infectious stages of syphilis fell 10% from the year before — the first substantial decline in more than two decades. Gonorrhea cases dropped 7%, marking a second straight year of decline and bringing the number below what it was in 2019.

“I’m encouraged, and it’s been a long time since I felt that way” about the nation’s epidemic of sexually transmitted infections, said the CDC’s Dr. Jonathan Mermin. “Something is working.”

More than 2.4 million cases of syphilis, gonorrhea and chlamydia were diagnosed and reported last year — 1.6 million cases of chlamydia, 600,000 of gonorrhea, and more than 209,000 of syphilis.

Syphilis is a particular concern. For centuries, it was a common but feared infection that could deform the body and end in death. New cases plummeted in the U.S. starting in the 1940s when infection-fighting antibiotics became widely available, and they trended down for a half century after that. By 2002, however, cases began rising again, with men who have sex with other men being disproportionately affected.

The new report found cases of syphilis in their early, most infectious stages dropped 13% among gay and bisexual men. It was the first such drop since the agency began reporting data for that group in the mid-2000s.

However, there was a 12% increase in the rate of cases of unknown- or later-stage syphilis — a reflection of people infected years ago.

Cases of syphilis in newborns, passed on from infected mothers, also rose. There were nearly 4,000 cases, including 279 stillbirths and infant deaths.

“This means pregnant women are not being tested often enough,” said Dr. Jeffrey Klausner, a professor of medicine at the University of Southern California.

What caused some of the STD trends to improve? Several experts say one contributor is the growing use of an antibiotic as a “morning-after pill.” Studies have shown that taking doxycycline within 72 hours of unprotected sex cuts the risk of developing syphilis, gonorrhea and chlamydia.

In June, the CDC started recommending doxycycline as a morning-after pill, specifically for gay and bisexual men and transgender women who recently had an STD diagnosis. But health departments and organizations in some cities had been giving the pills to people for a couple years.

Some experts believe that the 2022 mpox outbreak — which mainly hit gay and bisexual men — may have had a lingering effect on sexual behavior in 2023, or at least on people’s willingness to get tested when strange sores appeared.

Another factor may have been an increase in the number of health workers testing people for infections, doing contact tracing and connecting people to treatment. Congress gave $1.2 billion to expand the workforce over five years, including $600 million to states, cities and territories that get STD prevention funding from CDC.

Last year had the “most activity with that funding throughout the U.S.,” said David Harvey, executive director of the National Coalition of STD Directors.

However, Congress ended the funds early as a part of last year’s debt ceiling deal, cutting off $400 million. Some people already have lost their jobs, said a spokeswoman for Harvey’s organization.

Still, Harvey said he had reasons for optimism, including the growing use of doxycycline and a push for at-home STD test kits.

Also, there are reasons to think the next presidential administration could get behind STD prevention. In 2019, then-President Donald Trump announced a campaign to “eliminate” the U.S. HIV epidemic by 2030. (Federal health officials later clarified that the actual goal was a huge reduction in new infections — fewer than 3,000 a year.)

There were nearly 32,000 new HIV infections in 2022, the CDC estimates. But a boost in public health funding for HIV could also also help bring down other sexually transmitted infections, experts said.

“When the government puts in resources, puts in money, we see declines in STDs,” Klausner said.

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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.

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World’s largest active volcano Mauna Loa showed telltale warning signs before erupting in 2022

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WASHINGTON (AP) — Scientists can’t know precisely when a volcano is about to erupt, but they can sometimes pick up telltale signs.

That happened two years ago with the world’s largest active volcano. About two months before Mauna Loa spewed rivers of glowing orange molten lava, geologists detected small earthquakes nearby and other signs, and they warned residents on Hawaii‘s Big Island.

Now a study of the volcano’s lava confirms their timeline for when the molten rock below was on the move.

“Volcanoes are tricky because we don’t get to watch directly what’s happening inside – we have to look for other signs,” said Erik Klemetti Gonzalez, a volcano expert at Denison University, who was not involved in the study.

Upswelling ground and increased earthquake activity near the volcano resulted from magma rising from lower levels of Earth’s crust to fill chambers beneath the volcano, said Kendra Lynn, a research geologist at the Hawaiian Volcano Observatory and co-author of a new study in Nature Communications.

When pressure was high enough, the magma broke through brittle surface rock and became lava – and the eruption began in late November 2022. Later, researchers collected samples of volcanic rock for analysis.

The chemical makeup of certain crystals within the lava indicated that around 70 days before the eruption, large quantities of molten rock had moved from around 1.9 miles (3 kilometers) to 3 miles (5 kilometers) under the summit to a mile (2 kilometers) or less beneath, the study found. This matched the timeline the geologists had observed with other signs.

The last time Mauna Loa erupted was in 1984. Most of the U.S. volcanoes that scientists consider to be active are found in Hawaii, Alaska and the West Coast.

Worldwide, around 585 volcanoes are considered active.

Scientists can’t predict eruptions, but they can make a “forecast,” said Ben Andrews, who heads the global volcano program at the Smithsonian Institution and who was not involved in the study.

Andrews compared volcano forecasts to weather forecasts – informed “probabilities” that an event will occur. And better data about the past behavior of specific volcanos can help researchers finetune forecasts of future activity, experts say.

(asterisk)We can look for similar patterns in the future and expect that there’s a higher probability of conditions for an eruption happening,” said Klemetti Gonzalez.

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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.

The Canadian Press. All rights reserved.

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Waymo’s robotaxis now open to anyone who wants a driverless ride in Los Angeles

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Waymo on Tuesday opened its robotaxi service to anyone who wants a ride around Los Angeles, marking another milestone in the evolution of self-driving car technology since the company began as a secret project at Google 15 years ago.

The expansion comes eight months after Waymo began offering rides in Los Angeles to a limited group of passengers chosen from a waiting list that had ballooned to more than 300,000 people. Now, anyone with the Waymo One smartphone app will be able to request a ride around an 80-square-mile (129-square-kilometer) territory spanning the second largest U.S. city.

After Waymo received approval from California regulators to charge for rides 15 months ago, the company initially chose to launch its operations in San Francisco before offering a limited service in Los Angeles.

Before deciding to compete against conventional ride-hailing pioneers Uber and Lyft in California, Waymo unleashed its robotaxis in Phoenix in 2020 and has been steadily extending the reach of its service in that Arizona city ever since.

Driverless rides are proving to be more than just a novelty. Waymo says it now transports more than 50,000 weekly passengers in its robotaxis, a volume of business numbers that helped the company recently raise $5.6 billion from its corporate parent Alphabet and a list of other investors that included venture capital firm Andreesen Horowitz and financial management firm T. Rowe Price.

“Our service has matured quickly and our riders are embracing the many benefits of fully autonomous driving,” Waymo co-CEO Tekedra Mawakana said in a blog post.

Despite its inroads, Waymo is still believed to be losing money. Although Alphabet doesn’t disclose Waymo’s financial results, the robotaxi is a major part of an “Other Bets” division that had suffered an operating loss of $3.3 billion through the first nine months of this year, down from a setback of $4.2 billion at the same time last year.

But Waymo has come a long way since Google began working on self-driving cars in 2009 as part of project “Chauffeur.” Since its 2016 spinoff from Google, Waymo has established itself as the clear leader in a robotaxi industry that’s getting more congested.

Electric auto pioneer Tesla is aiming to launch a rival “Cybercab” service by 2026, although its CEO Elon Musk said he hopes the company can get the required regulatory clearances to operate in Texas and California by next year.

Tesla’s projected timeline for competing against Waymo has been met with skepticism because Musk has made unfulfilled promises about the company’s self-driving car technology for nearly a decade.

Meanwhile, Waymo’s robotaxis have driven more than 20 million fully autonomous miles and provided more than 2 million rides to passengers without encountering a serious accident that resulted in its operations being sidelined.

That safety record is a stark contrast to one of its early rivals, Cruise, a robotaxi service owned by General Motors. Cruise’s California license was suspended last year after one of its driverless cars in San Francisco dragged a jaywalking pedestrian who had been struck by a different car driven by a human.

Cruise is now trying to rebound by joining forces with Uber to make some of its services available next year in U.S. cities that still haven’t been announced. But Waymo also has forged a similar alliance with Uber to dispatch its robotaxi in Atlanta and Austin, Texas next year.

Another robotaxi service, Amazon’s Zoox, is hoping to begin offering driverless rides to the general public in Las Vegas at some point next year before also launching in San Francisco.

The Canadian Press. All rights reserved.

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