Harper’s flawed $10,000 TFSA promise + MORE Dec 2nd

(Illustration by Sebastien Thibault)
It’s now a foregone conclusion that Prime Minister Stephen Harper will increase the annual contribution limit of the Tax-Free Savings Account (TFSA) next spring when the Tories balance the budget, likely boosting it to $10,000. It’s a political move—engineered to bolster his re-election bid—and at first glance it’s great news for wealthy Canadians looking to tax shelter more of their investment earnings. But some tax experts are worried that it’s too good—that the government is giving up so much revenue, the tax break might not be sustainable over the long haul.
University of Calgary School of Public Policy director Jack Mintz says there’s no doubt that increasing TFSA contribution limits will allow Canadians to shelter more dividends, interest and capital appreciation from taxes. “It’s a positive step towards encouraging people to save,” he says.

$108B
What the Canadian government projects OAS will cost taxpayers in 2030

But Malcolm Hamilton, a senior fellow at the C…

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(Getty Images/Arda Guldogan)
Q: I just bought a new house. I have a $250,000 mortgage at 2.97%. We have a little over $2 million in investments, but they are all in RRSPs in fairly conservative investments. Last year we made 7% and this year made probably 5%. We are in our early 50s and still working. Is it better to pay off the mortgage and take the tax hit or pay the mortgage and hope I make more on my investments? I can’t seem to get my head around it.—Darby
A: The mortgage versus RRSP debate takes many forms, Darcy. Often people ask about whether to use their cash flow to either pay down their mortgage or put money in their RRSP. Your question is a little more extreme: cashing in your RRSP to pay off your mortgage.
Let’s start by reviewing some of the considerations:
First, here are some very general reasons to consider paying down your mortgage instead of contributing to your RRSP, subject to other factors:
-You are risk averse: Paying down debt provides you with a guaranteed rate of return via the interest you avoid thereafter—a return that will increase as interest rates normalize…

HONG KONG – Three of the founders of Hong Kong’s protest movement called Tuesday for an end to street demonstrations to prevent further violence and to take the campaign for democratic reforms to a new stage.
It wasn’t clear whether student protesters, who make up the bulk of the activists, would heed the call.
Professors Benny Tai Yiu-ting and Chan Kin-man and Pastor Chu Yiu-ming said they plan to surrender to police on Wednesday to take responsibility for protests that have shut down parts of the Asian financial centre for more than two months.
Instead of street protests, the three hope to continue the campaign through networking among civic groups, community organizing and education in democracy and human rights.
The three are founders of the Occupy Central movement to force China’s central government to scrap its requirement that candidates for the semiautonomous region’s chief executive be approved by a panel chosen by Beijing. However, they represent only one faction of demonstrators, most of whom are students…