Why the outcry over vanishing tax refunds?

March 4 2012 by Ellen Roseman

Paternalistic. Unfair. Sneaky. Arrogant. Wrong.

These are some taxpayers’ views of Ontario’s decision to pay social assistance benefits once a month, starting in July, instead of once a year at tax time.

The upshot: People with low to moderate incomes won’t be getting a substantial tax refund this spring. Some will actually owe money on their 2011 tax returns.

I did my column about it this weekend and got a bunch of angry comments (and 165 Facebook Recommends, more than usual).

Ontario bureaucrats talked to welfare experts, who said monthly payments were better for budgeting. The federal government pays the Canada Child Tax Benefit monthly — and no one objects to that.

Combining a few payments into something called the Ontario Trillium Benefit, the Dalton McGuinty government didn’t expect an outcry from the population it was hoping to help.

But many people were upset to find — without their knowledge — that the lump sum tax refund they had come to expect each year had vanished.

Ontario, to its credit, arranged to pay the 2011 benefits earlier than usual. The first instalments were paid last July and December, with two more instalments to come in March and June 2012.

Rather than sitting on people’s money in order to earn more interest, the government is advancing the payments. It is earning less interest.

Still, it’s clear that politicians underestimated the widespread love of tax refunds. They’re now thinking about changing the system (again) to allow freedom of choice.

A tax refund of $1,000+ may be the most lucrative windfall many people get. They use the money to pay bills, cover large expenses or simply spoil themselves and their family.

Will people be just as happy with a payment of $90 or $100 a month? Maybe they will in the long run, since most bills come on a monthly schedule.

But right now, many feel betrayed by a government that is making their financial situation worse — without consulting them — in the guise of extending a helping hand.

Tax preparers aren’t happy, either, dealing with clients who can’t figure out where their refunds went. Their tax software programs can’t calculate the Trillium Benefit that will be coming in July.

There’s an online calculator at the Ontario government’s website. But more information should have been available about a change that was announced a year in advance (in the 2011 provincial budget).

Ontario Finance Minister Dwight Duncan is well aware of the growing protest. He called me Friday and backed down from the decision, instead of defending it, by saying he’d explore an opt-out provision for those who insist on annual tax refunds.

It’s smart of Duncan to look for a compromise, if he can find one. It’s political suicide to come between people and their tax refunds.

There’s nothing like a cash windfall to make taxpayers happy, even if they would be better off with smaller payments made earlier in the year.

The scourge of telemarketing calls

March 3 2012 by Ellen Roseman

The CRTC’s National Do Not Call List, which I wrote about recently, is a mixed success.

The Do Not Call List (DNCL) has helped cut down unwanted solicitations, but it hasn’t lived up to expectations.

Here are a few problems:

* There are many exemptions. Newspapers and charities can call you, for example, even if you signed up to the DNCL. But if you put your name on a company’s internal do not call list and still get pestered, you can ask the CRTC to investigate.

* There are many telemarketers operating outside Canada. They can call you with impunity, since they aren’t subject to Canadian laws. Those phony Microsoft tech support people urging you to install new antivirus software, for example, are located halfway across the world.

* There are some telemarketers in Canada that just ignore the rules. They don’t want to buy the DNCL and update it regularly. They’ll keep calling you until they get hit with an enforcement action.

Air duct cleaning companies are especiallly obnoxious and hated by my readers. I get lots of complaints about their persistent efforts to get business. Victims insist they’re dealing with local firms.

Cleaning air ducts may be a worthless service in any case, according to this Walletpop story. I’ve also heard about companies charging a lowball price to get your consent and then adding extra charges for every air duct in every room of your home.

I recently visited the North Bay headquarters of the Canadian Anti-Fraud Centre, which has its own Facebook page.

The centre, started in 1993, is known for keeping tabs on all the latest marketing schemes and scams. Now it’s working with Visa and MasterCard to cut off fraudulent sellers’ access to credit card payments.

You can find a link to the centre at Canada Goose’s website. This high-end clothing is entirely made in Canada, but counterfeits are popping up around the world. Buy at your own risk, the company says:

After analyzing the content of many counterfeit jackets, we now know that in the place of the sanitized, Canadian down that is used by Canada Goose, you will find feather mulch, coated in bacteria, fungus and mildew, a significant health risks.

Every time a fraudulent scheme is killed off, a new one crops up. It’s like Whack A Mole, the carnival game. You’ll never win against the pesky critters.

So, take precautions. Arm yourself against fraud, which is always present — and more visible than ever in an interconnected world.

Don’t trust strangers who want to do you a favour.

Hang up the phone.

Kill the suspicious emails.

Report offenders to the right authorities.

Never let up your guard.