Area farmers call foul on proposed federal tax changes
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Small businesses, doctors and farmers are raising red flags over small business tax changes Justin Trudeau’s Liberal government is looking to make.
At issue are Ottawa’s plan to eliminate several tax incentives designed for private corporations.
Trudeau and Finance Minister Bill Morneau argue the tax system unfairly encourages wealthy Canadians to incorporate, so they can get a better tax rate than middle-income earners. They say the changes are meant to end tax advantages wealthy business owners use unfairly and the changes will ensure all Canadians have a level playing field.
The changes include restrictions on the ability of business owners to reduce their tax rate by sprinkling their income to family members in lower tax brackets, even if those family members do not contribute to the company. Limits on the use of private corporations to make passive investments unrelated to the company are also on the agenda.
Ryan Scragg is an area farmer who’s looking to incorporate. He says the changes would be anything but good news for farmers.
“This is the worst possible time of the year to come out with this announcement,” Scragg said. “It comes out in July and farmers are in the middle of spraying season. Now it’s harvest season and farmers haven’t been really able to get their head around it.”
Scragg said at this point, the tax changes would discourage farmers from becoming incorporated and growing their business if the incentives are taken away.
The government launched a 75-day public consultation period in July, which ends Oct. 2, and said they are listening to feedback and proposals and are open to making changes if need be.
