Hicks on Biz: Is it time for a taxpayer revolt? BY GRAHAM HICKS FIRST POSTED EDMONTON SUN: FRIDAY, SEPTEMBER 22, 2017
Canadian Prime Minister Justin Trudeau and Finance Minister Bill Morneau are learning the hard way.
Do not upset the little ol’ ladies.
In one of the most remarkable missteps of modern Canadian politics, even the little ol’ ladies are spitting mad at this government’s proposed tax reforms.
Ninety-two-year-old Nancy Power, an active (and powerful) federal Liberal party member all her life, has cancelled her party membership in protest.
A now-retired independent business woman, Nancy used funds generated from investments within her Canadian professional corporation as her retirement fund.
With the proposed tax changes, “they are going to take away 73% of my income,” says Power, “and that’s criminal.”
Justin and Bill have been run over by an unforeseen truck.
They thought they were simply carrying on with the Liberal election promise of helping the middle-class by more fair taxation of the top 1% of Canadian income-earners.
Somebody forgot to tell the duo that professional corporations aren’t just used by the super-rich top 1% of Canadians, but by all manner of small- and medium-sized business owners and entrepreneurs: Middle-class, hard-working Canadian entrepreneurs who create most of the country’s employment, who are not wealthy, who more than pay their fair share of the tax load … who pay for the ever-growing army of fully-pensioned, all-benefited, impossible-to-fire public-sector employees – the new “haves” of the 21st Century.
If these proposals go through, small business could end up being taxed out of country or simply go out of business. Never has a cushy but dull 9-5 civil service job looked so appealing.
The reaction to these tax proposals has created a backlash the likes of which the Justin Trudeau government hasn’t seen in its two years in power.
Yet the Morneau/Trudeau response to the outcry has been as big a misstep as the tax reform proposals themselves.
They’ve dug in their heels, insisted that such tax reforms are helping the middle class at the expense of the super-rich – those $500,000-plus a year doctors, accountants and lawyers who “sprinkle” their income among family members, who seek out every legitimate means possible to lower their taxes within professional corporations.
At a recent meeting, Edmonton Centre Liberal MP Randy Boissonnault faced a barrage of criticism from 12 of Edmonton’s leading tax lawyers and accountants. He stuck gamely to the party line, I’m told.
The whole narrative is wrong, wrong, wrong.
Canada’s tax problems are not about the rich getting away with murder. It’s about a huge, unwieldy, hydra-headed tax-system monster that has become so complex and multi-faceted in the 46 years since it was last reviewed and overhauled (by Finance Minister E.J. Benson in 1971 when Justin Trudeau’s father Pierre Trudeau was prime minister) that nobody really knows what’s what.
The need is not for more tweaks and changes to tax policy, Band-Aids piled upon Band-Aids upon Band-Aids.
It’s for a bold, visionary finance minister, fully backed by the prime minister and his cabinet, to wipe the slate clean, and start anew with a simplified, understandable tax system – taking into account not just personal and corporate income tax, but ALL taxes levied on the Canadian citizenry at every level of government.
I wonder if today’s tax morass is semi-deliberate. Perhaps it is not to Trudeau/Morneau’s advantage to lance and drain this boil. If the Canadian public realizes how many tax credits, loopholes and incentives exist, especially for corporate friends of both the Liberal and Conservative parties, a true tax revolution would occur and the bastards would be kicked from power ... which raises the spectre of a socialist New Democrat government taking power, a la Alberta’s 2015 provincial election. A pox on all houses!
The smartest thing Morneau and Trudeau could do is to pull a Ralph Klein. “We were wrong, we’re sorry; we are pulling these tax reforms off the table in favour of a thorough, long-overdue review/reform of the tax system we can take to you, dear voter, in the next federal election.”
I doubt Justin Trudeau has the intestinal fortitude to go up against the entrenched special interest groups within his own party and among Canada’s elite – for whom the more complex the tax system, the more they stand to gain.
But when even the little ol’ ladies are spitting mad, something has to give.