Sudbury MP weighs in on small business tax changes
Tax changes will affect business owners who are 'leaving money inside the corporation' says MP
As the Liberal government faces a backlash from small business owners over proposed changes to federal tax laws, MP Paul Lefebvre is assuring Sudburians that most people won't be affected.
Lefebvre, who is a tax lawyer by trade, also owns his own business, and was a "little concerned" when he first saw the rule changes.
"[After reading the rules] I was in contact with the Prime Minister's Office and other tax professionals for more clarity," he said.
"[Now] we're in a consulting period, we're getting feedback."
- Ottawa proposes curtailment of 'income sprinkling' and curbing of 'passive investment income'
- How proposed changes to Canada's tax system could hit small business
Andre Dumais, former chair of the Sudbury Chamber of Commerce, told CBC News in a recent interview that the feds were trying to "shatter the piggybank" of small businesses and that entrepreneurs are unfairly targeted by the rule changes.
"I look at people in this community that run $20 million organizations and that's nowhere near what they take home," Dumais said. "But on the flipside you've got CEOs of banks...not having sacrificed anything."
"You want the wealthy people? Go chase those guys. Leave the small business people alone. They're just trying to keep things afloat."
But Lefebvre said the government is stepping in to correct some elements of the law that can be misused.
"Right now a 3-month old can have access to $840,000 on the sale of their parents' shares. That we find unfair," he said.
"Right now, you can also convert your profits and play with the rates. Instead of paying yourself dividends, you can convert it into capital gains. That is unfair."
Lefebvre said that it's only a small number of businesses that would be affected by the changes. So even though concerns raised by the community are legitimate, he said it's far too early to say they will have a negative impact.
"[The new rules] affect people who are just leaving money inside the corporation," Lefebvre said. "There's only a few groups directly impacted. It's also not retroactive."
"Whatever profit has legitimately been raised, nothing will happen."