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Investor Immigrants in Canada Pay Less Tax Than Refugees

Investor Immigrants in Canada Pay Less Tax Than RefugeesInvestor Immigrants in Canada Pay Less Tax Than Refugees

Refugees who have come to Canada over the past 30 years have paid more income tax in this country than immigrant investors admitted under the now defunct immigrant investor program, critics say.

Ian Young, a South China Morning Post journalist based in Vancouver, crunched the numbers with data from Citizenship and Immigration Canada,CBCNews reported.

Only a small proportion of the immigrant investors who have come to Canada under the program since 1980 end up staying here, Young said, again relying on numbers from the federal government. “After five years, only 39 percent of investor immigrants declared any income. Not only that, those who did, their average incomes were very low,” he said.

  Not Much Income

They may have been millionaires, but they were earning very little money here in Canada. Immigrant investors declared about $18,000 to $25,000 of income annually, he said.

“Why? Either because they were living off existing wealth, or they weren’t declaring their [global] incomes,” Young said.

By contrast, refugees to Canada start out earning about $17,500 a year, and by the end of their first 10 years, 66 percent of them are declaring an earned income.

Their annual earnings eventually reach a level closer to economic immigrants to Canada, in the $30,000 range, he said.

Canada’s immigrant investor program operated from 1980 until it was closed by the Harper government last year, bringing more than 180,000 people to Canada. Many in the early years were Hong Kong Chinese, but the more recent immigrants have been mainland Chinese.

There have been solid citizens who arrive via the program, but some just return to their home country, passport in hand, Young argues.

Young considers the program a failure, not least because there is little evidence of business formation in Canada from the influx of newcomers. “If an immigrant investor already had a very successful business back in China, why would they shut that down and try to start afresh in Canada?” he said.

He argues the program amounted to a cash-for-passport deal, without benefiting the Canadian economy.

  No Public Accounting

Chris Ho, an immigration lawyer in Richmond, B.C., is also critical of the immigrant investor program, saying there’s been no public accounting of what happened to the millions those investors brought to Canada.

In the early days, immigrant investors were asked to sink $400,000 into a Canadian venture, but later the figure was raised to $800,000.

Ho said it’s “ridiculous” to say those immigrants are not an asset to Canada because they don’t pay much income tax here.

“Typically they would buy a house. They would spend a lot of money in fixing a house, buying a car, spending a lot of money consuming goods, stuff like that. All kinds of things that help the economy,” Ho said.

“Look at the property taxes they pay every year on a house worth $1 million or $2 million.”

 

Financialtribune.com