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Recent immigrants cost Canadian taxpayers at $20 billion annually

bongcan

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http://www.vancouversun.com/business/bc2035/Immigration+burden+economy/8511873/story.html


According to a Fraser Institute study by Herbert Grubel and Patrick Grady, recent immigrants imposed a fiscal burden of at least $20 billion annually (1.1 per cent of GDP) on Canadian taxpayers, mainly because the income taxes paid by these immigrants were about half those paid by Canadians, while both groups received the same benefits from government spending.

is a professor of economics (emeritus) at Simon Fraser University.

It says the study is particularly interesting because its author, Harvard professor George Borjas, is considered to be America’s foremost expert on the economics of immigration.
 

steaky

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I'm not surprised.

If one got a US green card or citizenship, he is a lawful permanent resident of the U.S. even if he lives abroad. This means he is treated as a U.S. resident for U.S. income tax purposes and he is subject to U.S. tax on his worldwide income from whatever source derived.

In Canada, it's not the same.
 

newtone

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Interesting article, thanks for sharing. Time to move to USA
 

torontosm

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bongcan said:
http://www.vancouversun.com/business/bc2035/Immigration+burden+economy/8511873/story.html


According to a Fraser Institute study by Herbert Grubel and Patrick Grady, recent immigrants imposed a fiscal burden of at least $20 billion annually (1.1 per cent of GDP) on Canadian taxpayers, mainly because the income taxes paid by these immigrants were about half those paid by Canadians, while both groups received the same benefits from government spending.

is a professor of economics (emeritus) at Simon Fraser University.

It says the study is particularly interesting because its author, Harvard professor George Borjas, is considered to be America's foremost expert on the economics of immigration.
Very interesting article...thanks for sharing it! I knew this was the case, but always wondered what the magnitude was.
 

icherian

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What are the reasons for this phenomenon?
Is it because they live outside side the country, but if they live outside the country how do they reap the benefits?
Or is it they don't pay taxes?
Or is it because they are in job where their income is low?

I see it as a seed for later hate wave towards immigrants.
 

torontosm

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icherian said:
What are the reasons for this phenomenon?
Is it because they live outside side the country, but if they live outside the country how do they reap the benefits?
Or is it they don't pay taxes?
Or is it because they are in job where their income is low?

I see it as a seed for later hate wave towards immigrants.
The primary reason in the article was because (new) immigrants contribute less in taxes than people who are either non-immigrants or established immigrants. However, they "consume" the same amount of public facilities (roads, schools, health care, etc.). The resultant drain on the economy that has to be at least partially funded by non-immigrants is estimated to be $20 billion p.a.
 

amikety

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icherian said:
What are the reasons for this phenomenon?
Is it because they live outside side the country, but if they live outside the country how do they reap the benefits?
Or is it they don't pay taxes?
Or is it because they are in job where their income is low?

I see it as a seed for later hate wave towards immigrants.
If they live outside Canada: a few years ago, the Canadian government evacuated a number of citizens from Lebanon. A good portion of them had only lived in Canada long enough to obtain their passport, then left and never came back. They are "Canadians of convience" which has angered some people. The cost to evacuate them was high and considering many of them haven't paid any form of tax in a long time, it set some people off. This is just one example (and the only one I'm familiar enough with to share). I've also heard stories of them "abusing" the healthcare system, aka only staying in Canada long enough to get a surgery, etc, then going back to their home country. They don't remain to help put back in tax dollars to the system.

It's been a well known fact in academic circles for some time that immigration isn't having the intended economic benefit that Canada invisioned. This is the driving reason for many of the changes we've seen such as stricter/faster failed refugee deportation and tightening up on parent sponsorship. It's also why the FSW program was re-vamped and the Federal Skilled Trades program was added. There is plenty of academic research available out there if you want to look into it. Go to Google Scholar and search "economic impact of immigration in Canada."

However, immigration does have an overall positive economic impact in Canada, just much smaller than the goverment intended.
 

torontosm

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amikety said:
However, immigration does have an overall positive economic impact in Canada, just much smaller than the goverment intended.
Agreed, but if the programs could be further reformed (as the government is currently trying to do), I'm sure this impact would be increased and everyone, citizens and new immigrants alike, would benefit.
 

newtone

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amikety said:
If they live outside Canada: a few years ago, the Canadian government evacuated a number of citizens from Lebanon. A good portion of them had only lived in Canada long enough to obtain their passport, then left and never came back. They are "Canadians of convience" which has angered some people. The cost to evacuate them was high and considering many of them haven't paid any form of tax in a long time, it set some people off. This is just one example (and the only one I'm familiar enough with to share). I've also heard stories of them "abusing" the healthcare system, aka only staying in Canada long enough to get a surgery, etc, then going back to their home country. They don't remain to help put back in tax dollars to the system.

It's been a well known fact in academic circles for some time that immigration isn't having the intended economic benefit that Canada invisioned. This is the driving reason for many of the changes we've seen such as stricter/faster failed refugee deportation and tightening up on parent sponsorship. It's also why the FSW program was re-vamped and the Federal Skilled Trades program was added. There is plenty of academic research available out there if you want to look into it. Go to Google Scholar and search "economic impact of immigration in Canada."

However, immigration does have an overall positive economic impact in Canada, just much smaller than the goverment intended.
This is actually the fault of the government. We needs to ask why are people becoming "Canadians of convenience". There are very good reasons for it. The government has made it easier through their foreign and domestic policies to abuse the system very easily.

Let me give you an example. Engineer from India wants to apply to Canada for better life and future. While applying for permanant residence status he can see that his education and work experience as an engineer give him maximum points. This is coupled with the fact that on the cic website it states eligible occupations for different types of engineers required. http://www.cic.gc.ca/english/immigrate/skilled/apply-who-instructions.asp

So what would an Indian trained Engineer with an Indian degree with Indian work experience think? "My skills, education, and work experience is what is required in Canada" plus "I qualify according to the Canadian points system"

Once he lands here
1) he is told his degree is not recognized
2) work experience is not recognized

and all his savings are depleted from day to day costs of living, the poor Engineer turns into a bathroom cleaner to make ends meet. The only thing he can hope for is getting the Canadian passport and either move to USA for better prospects or some other country in the world where he can work as an Engineer.

Same thing can be said with healthcare and as you said rightly people stay here to get major surgery and then they take off because other places around the world have more options than what Canada has to offer.

So to sum things up, there are a few questions we need to ask

1) Why are people going back?
2) What positive things do other countries have that Canada does not?
3) What could be done to stop people from going back?
4) How can we change the system so that more engineers, doctors, IT professionals, get jobs in their respective fields without going broke trying to recertify themselves. Because they are clearly getting points for immigration system but those points are meaningless if they dont transfer directly into job prospects for them.

Canada has one of the most educated work forces in the world but its useless if the degrees do not match with occupation, this way the people suffer, the business suffer, the system suffers and finally the country as a whole suffers.
 

torontosm

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newtone said:
So to sum things up, there are a few questions we need to ask

1) Why are people going back?
2) What positive things do other countries have that Canada does not?
3) What could be done to stop people from going back?
4) How can we change the system so that more engineers, doctors, IT professionals, get jobs in their respective fields without going broke trying to recertify themselves. Because they are clearly getting points for immigration system but those points are meaningless if they dont transfer directly into job prospects for them.
One more question we should ask is why do we continue to let more engineers/doctors/accountants/fast-food service workers, etc. in each year? I am of the strong belief that there should be a temporary suspension of the immigration program until some fundamental issues can be sorted out.
 

newtone

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There is a very simple answer to that. Every immigrant is supposed to bring in approximately $9,000, Canada imports 250,000 immigrants per year.

So $9,000 x 250,000 = 2250000000 (about $2.2 billion/year). You want to tell the immigration minister to suspend this program?
 

torontosm

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newtone said:
There is a very simple answer to that. Every immigrant is supposed to bring in approximately $9,000, Canada imports 250,000 immigrants per year.

So $9,000 x 250,000 = 2250000000 (about $2.2 billion/year). You want to tell the immigration minister to stop this program.
So according to your logic, every immigrant spends 100% of the funds that they bring immediately? Even if this ridiculous premise was true, what happens in year 2? Year 3? Bringing money in to keep it in the bank does not necessarily contribute to the economy.
 

newtone

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Yes I am assuming they will be spending that in Canada, now if they borrow the $9,000 from someone just to show at the border to get past immigration and send it back to where they originally got it from then yes that is also a problem. Its true the system is really broken and its also true what are they gonna do after a few years which is why they wait for the Canadian passport eagerly.
Once people obtain them they go back to where they love to live and make money and have more options in life. if there is a health crisis or poop hits the ceiling then one can always come back to Canada.
So the government has really given people that option to abuse the system at their discretion.

Bringing that money and putting it in the bank contributes directly to the economy. The bank can lend that money to Canadians at an interest rate, the bank also charges bank fees, so it does help the economy in certain way.
 

Peter Rabbit

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I am convised that some immigrants (those educated and willing to work) bring in money and contribute to the economy. I consider myself one of them.
However, in my job and volunteer work, I sadly see how much some immigrants cost this country. I am sincerely alarmed. There are Canadians who are on welfare as well (generational trend, in my view), but I am worried that if more people take resources than contribute, we are in big trouble. I can not understand why we accept such individuals in the country! Other countries do not seem to be in a rush to take them in! Only because they keep social workers, special education teachers, second language teachers and welfare workes employed? I almost see it as a way of creating and ensuring that there is another class of individuals ... the poor, the uneducated, the vulnerable who can not do anything and who rely on hand-outs! I see some of our social programs as a conspiracy to keep some populations dependent on their programs – keep the status quo!
I hope and pray that I am wrong (I often am).