Talk of tax reform yields frosty reception for Federal Finance Minister
Federal Finance Minister Bill Morneau tried to alleviate tax reform fears at Canadian Chamber of Commerce AGM
Federal Finance Minister Bill Morneau spoke to dozens of business leaders from across Canada on the government's plans to reform several tax loopholes.
Despite his reassurances, following a question and answer period, many were left with the firm belief the changes will hurt small business owners.
The Liberal Government proposed in mid-July to close what it has identified as three loopholes, which allow some high-income Canadians who incorporate their businesses, to avoid paying a higher tax rate.
While the government has repeatedly said the changes are to ensure the tax system is fair, several groups have decried them as a small business killer.
Despite Morneau's assertion the tax reforms won't harm businesses, several audience members shook their heads while he spoke.
During the question and answer period, one query about opening an independent Royal Commission into tax reform was met with applause.
"We've looked at this for over a year with some of our leading tax experts," responded Morneau, who then said the government was going to stick with its current approach.
But, following the meeting, Morneau reiterated that the government was still open to making changes.
"We are still listening and we have not finalized the measures," Morneau said.
But despite those reassurances, Perrin Beatty, the president and CEO of the Canadian Chamber of Commerce said later at a news conference, that many concerns remain.
There is a continued fear the changes will be unfair to family farmers and small businesspeople, said Beatty.
More clarity needed
When a reporter pointed out that the proposed changes would only affect a small segment of business owners, Beatty said the government needed to be more clear on its messaging.
"Our call to the government would be this — spell out exactly it is what you're trying to achieve," he said.
To drive home their concerns, the head of Fredericton's Chamber of Commerce brought several local small business owners to the news conference.
Jill Green was among the group. She owns Green Imaging, an oil and gas company in Fredericton. She said she wouldn't have been able to start her company if the proposed tax changes had been in effect at the time.
'This is not fair'
"When you start a company, the first people you go to for help with investment, is your family," she said.
Now that her company is successful, she said she pays dividends to her shareholders, who are her family members.
"Under the proposed changes, my family, my retiree parents, would be paying at the highest tax bracket on the dividends," Green said. "This is supposed to be about fairness, and this is not fair."