This is only true if you set up shop so that you're an employee of your incorporated company. If you pay yourself dividends instead of a salary, the CPP requirement isn't an issue, and the tax rate on dividend income is lower than on employment income. That said, the advantage to paying yourself with dividends has been shrinking over the years, but there's still savings to be had when you consider that the business tax rate has shrunk as well.
Ummm… no, self employed individuals pay twice as much CPP as employed individuals.
In 2013, the maximum amount is $51,100. The contribution rate on these pensionable earnings is 9.9%, split equally between you and your employer. If you are self-employed, you pay the full 9.9%. The maximum contribution for employers and employees in 2013 is $2,356.20 each.
If you are self-employed, the maximum contribution is $4,712.40. Your contributions are based on your net business income (after expenses). You do not contribute on any other type of income, such as investment earnings. If, during a year, you contributed too much or earned less than the set minimum amount, your contributions will be refunded when you file your income taxes.
http://www.servicecanada.gc.ca/eng/services/pensions/cpp/contributions/
For people who have incorporated their businesses, yes, there is no CPP assessed on dividends and you can avoid paying it. But let's keep this on track…