October 6, 2017
With the October 2, 2017 consultation deadline now past, the government has received over 20,000 submissions concerning their July 18, 2017 private company tax proposals. We, as a firm, did not make a formal submission but responded in other ways. Michael Cadesky was heavily involved in STEP Canada’s submission to the Minister of Finance, Peter Weissman was invited to speak to the Commons Standing Committee on Finance, Ian Pryor spoke to the Standing Senate Committee on National Finance and we wrote numerous newspaper articles.
It seems the Government has acknowledged the public’s concerns. On October 3, 2017 the Department of Finance issued a Press Release stating:
The Government has listened to small business owners, professionals and experts during the consultation on tax planning using private corporations, and will act on what it has heard…..
The Government will base its next steps on the following key principles. We will:
- Support small businesses and their contributions to our communities and our economy.
- Keep taxes low for small businesses, and support owners to actively invest in their growth, create jobs, strengthen entrepreneurship and grow our economy.
- Avoid creating unnecessary red tape for hard-working small businesses.
- Recognize the importance of maintaining family farms, and work with Canadians to ensure we don’t affect the transfer of a family business to the next generation.
- Conduct a gender-based analysis on finalized proposals, to ensure any changes to the tax system promote gender equity. About 83 per cent of passive investment income is earned by Canadian-controlled private corporation (CCPC) owners making more than $250,000. About 70 per cent of these individuals are men.
We are hopeful that these statements confirm that the Government will significantly scale back the scope and complexity of its proposals. There has been no commitment from the Government regarding the timing of release of any new proposals. Without further comments from Ottawa, there remains uncertainty regarding what steps should be taken in 2017 to optimize taxes before any new rules come into force.
September 25, 2017
Since the Federal government released sweeping proposals to change the taxation of private Canadian businesses on July 18, 2017, we have been working around the clock to fully understand the proposals, their merits and their flaws. Our “Tax Bomb” document has been acknowledged in the press, we have been published in the Globe and Mail and been quoted in the media.
We have had discussions with members of the Senate, MP’s and with the Office of the Leader of the Opposition.
Our efforts are continuing tomorrow Tuesday, September 26: Peter Weissman will be addressing the House of Commons Standing Committee on Finance, as an invited witness, to address the tax proposals.
Our firm continues to be actively involved in a number of formal and informal groups that are trying to better educate politicians, the media and the public as to the good, the bad and the ugly of the proposals.
We are committed to ensuring our clients’ and other professionals’ concerns are heard.