Too often the discussion of tax reform is boiling down to partisan debate.
But this question is so much larger, and is fundamentally a right or wrong issue.
The last time a tax reform of this magnitude was implemented it was the early ’70s. It took about six years of consultation and about two years of legislative debate to become law. The government is attempting to ram this through with a 72-day consultation period during harvest. This cannot be seen as a coincidence.
The federal government to date has continued to move forward rapidly with its tax reform initiative. As each day passes it is becoming increasingly clear that the communication strategy regarding this leaves a lot to be desired. All of Canadian agriculture is united in expressing serious concerns in opposition to the tax reform initiative in its present form and is working through a coalition of over 60 organizations across our great land.
Minister Morneau and Minister MacAulay are now starting to make statements attempting to ensure that the tax exemption on intergenerational transfers and the lifetime capital gains exemption will be maintained. While this is good news it highlights the failure of the communication initiative.
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There was nothing in the documents about tax reform stating that the capital gains exemption would be protected for farmers.
The Department of Finance has wasted the time, energy and resources of financial experts like accountants and certified financial planners and others, by not stating what the intended tax reform proposal actually looked like. Where are the ethics in that?
A good communication plan would have consulted financial experts on the impacts the tax reform would have on various stakeholders and the overall effect on the economy. This would have led to the financial experts and the Department of Finance having congruent interpretations of the tax reform.
Instead, there is a huge disconnect between what the Department of Finance is spinning and how financial experts interpret the tax reform policy.
There are a number of significant “unintended consequences” as a result of the lack of meaningful consultation. These raise a lot of questions and are major concerns for succession planning and passive income within farms and small-business companies. Our local communities thrive on the health of small business and the health of the ag sector. This raises the question, why have these not been addressed in the proposal already? How does one know that these aren’t actually objectives rather than unintended consequences? What kind of government plants the seeds of a class war in our great nation?
The voices across our nation are getting louder and louder as they register their concerns any way they can in hope that the government will listen and actually have meaningful consultation. In my opinion, the whole package should be thrown out and started over with proper, meaningful consultation. An even better option would be to leave things the way they are and drop the whole tax initiative and spend less. A low corporate tax is one of the few things that help us compete internationally.
In Western Canada we typically export 90 per cent of what we produce and are farther from tidewater than other major exporters. It is not fair to compare tax legislation of small-business companies with that of individual people; they are quite different. For that would be like comparing meat with bread; individually quite different but when put together can actually make something better and more useful.
I have always believed that government should work for the people not the reverse. It appears that the path we must utilize to maintain our ability to have our voice be heard is to lobby federal Liberal MPs any and every way we can.
MPs need to be convinced that they need to represent the views of their constituents, for clearly they are not.
The above was originally published in the Oct. 12, 2017 issue of the Manitoba Co-operator.