The South Okanagan – West Kootenay’s Member of Parliament is coming down solidly on the side of business as the Trudeau government ponders tax reform.
In a column shared with OsoyoosToday, MP Richard Cannings decries proposed changes to federal tax laws that would “make it more difficult for small businesses to make passive investments in their companies and share profits with members of their families.”
The Liberals, he says, claim that many small business owners are using these methods to avoid paying their fair share of taxes.
But, adds Mr. Cannings, business owners — merchants, farmers, lawyers and doctors — across the country have risen up in anger over the proposals.
Why the controversy?
“Well, the small business owners rightly point out that their financial situations are very different from salaried employees,” explains Mr. Cannings. “They don’t have pensions, sick leave, parental leave and other benefits and are often taking big risks for little profit for long periods of time while growing their companies.”
The MP says he understands their position, noting he was self-employed for 20 years, “so I know about those uncertainties and lean times.”
“I’ve talked to doctors who have to save up for a year before they can afford to take maternity leave, business owners who have to put aside money so that they can survive through years when profits are minimal or non-existent,” he writes. “I’ve heard from entrepreneurs who are working very long hours to build their companies and use passive investments as a way to get through difficult times.”
The Liberal government is estimating the tax changes will add $250 million to annual government revenues.
But, says Mr. Cannings, the Liberals have backed down on an election promise to close a much bigger loophole: tax cuts wealthy CEOs receive when they are paid in stock options instead of salary.
“Closing that loophole would only impact the top one percent of income earners and would net the government an estimated $800 million per year in new taxes.”
That, he says, would be tax fairness.
The Liberal government, he adds, should also tackle the huge issue of big corporations “moving their profits to offshore tax havens, cheating Canadians of billions in tax dollars.”
“We all want the tax system to be fair, Mr. Cannings says. “But it’s clear that these proposed changes need more than a bit of summertime consultation.
“The government needs to truly listen to the business owners so that any new system can stymie true tax cheats without putting legitimate businesses at risk.”