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Dan-in-Ottawa

Another Liberal tax grab?

Social media allows citizens to share comments, questions and concerns with elected officials in real time that can quickly demonstrate a trend.

As an example, early this week, my social media feed, along with in-person meetings, was filled with outrage over news that if you are an employee who receives a staff discount, that discount would now be considered a taxable benefit by the Canadian Revenue Agency (CRA). 
 
Public reaction to this change in interpretation from the CRA has been overwhelming angry and strongly opposed.

For small business owners, the thought of attempting to administer the records of documenting staff discounts was another serious concern as was a potential reduction in wages for staff that might use a staff discount.
 
Fortunately, there may be some positive news on this matter.

National Revenue Minister Diane Lebouthillier has indicated that this change on interpretation of the tax code is not one the minister authorized.  It has been further reported that the minister has instructed the CRA to remove this interpretation from the CRA website.

In Ottawa circles, this is often referred to as “the minister throwing the department under the bus."

From my perspective, it seems clear the minister recognized the outrage of this decision and has acted quickly to attempt to mitigate this change to the tax code.
 
Currently, this interpretation of the tax code is said to be officially under review while CRA consults with stakeholders.

Unfortunately, this does not necessarily mean that the CRA may not again attempt to implement a similar tax grab targeted against workers who receive a staff discount.
 
Given that many workers are in occupations that may not involve a staff discount, I would like to hear your views on this subject.

  • Would you support a staff discount being considered a taxable benefit or do you prefer the status quo where discounts are left alone by the CRA?

I can be reached at [email protected] or call toll free at 1-800-665-8711.



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PM's tweet troublesome

To those fleeing persecution, terror & war, Canadians will welcome you, regardless of your faith. Diversity is our strength #WelcomeToCanada 
— Tweet from Prime Minister Justin Trudeau

Many now believe this well-intended tweet from Prime Minister Justin Trudeau helped to instigate a surge of illegal border crossings into Canada.

I will give the prime minister some credit as he has since modified his message to point out that while “Canada is an opening and welcoming society,” that “We are also a country of laws.”

These more recent quotes were a result of roughly 8,000 recent illegal border crossings into Canada. Keep in mind in Ottawa, the Liberal government refers to an illegal border crossing as an “irregular” border crossing.
 
Recently at the House of Commons’ Standing Committee on Citizenship and Immigration, opposition MPs had the opportunity to question senior officials from Immigration, Refugees and Citizenship Canada (IRCC) to learn more about how this situation was being handled.
 
The committee learned that in many cases there is an alarming lack of data. As an example, the department had no information of how many people, who entered Canada in 2017 through illegal points of entry, had been found to have criminal backgrounds.

Likewise there is no data on the percentage of asylum claims from those entering Canada illegally, as opposed to legally.
 
Some information that department could confirm. The government has directed, through ministerial order, that those entering Canada illegally will receive expedited health benefit coverage along with expedited work permits.

This basically means that those who are entering Canada illegally are going to the front of the line ahead of those who enter through legal methods.

Conversely, it has also been revealed that roughly 80 IRCC staff members have been diverted to deal with asylum claims from those who have entered Canada illegally, thus increasing the wait time for those who have legally followed all of the rules to remain in Canada.
 
My question for this week: 

  • do you think it is a good policy for those who enter Canada legally and follow the rules, to be placed at the back of the line while those who enter illegally receive expedited treatment? 

 
I can be reached at [email protected] or call toll free 1-800-665-8711.



Is tax fairness fair?

Although the subject of the Liberal government's contemplated “tax fairness” measures continues to dominate much of the discussion I am hearing both here in the riding and in Ottawa, it is important to not overlook the previous Conservative government's “fairness” debate during the last Parliament.
 
Many may forget that the federal public sector pension plans as well as the MP pension plan contributions were heavily subsidized by taxpayers.

In a measure of pension plan fairness to taxpayers, former prime minister Stephen Harper made changes so that contributions to these respective pension plans would eventually become equally split at 50/50 between employees and the employer. 

Those changes were estimated to save taxpayers $2.6 billion over a five years and are now fully in effect for 2017.
 
One aspect of these changes was not widely reported. Mr. Harper also removed a special pension clause reserved exclusively for prime ministers. Removing this clause cost Mr. Harper in excess of $1 million in future pension benefits that his predecessors still receive.
 
I mention this for the fact that it was revealed this week in the House of Commons that the Liberal tax changes, if implemented, will not adversely impact the personal family fortunes of either Prime Minister Justin Trudeau or Finance Minister Bill Morneau.

This revelation has created a significant amount of controversy, for good reason. 

When millionaire families, being the real one per cent of wealth, are not being impacted by “tax fairness” at the expense of small business owners, farmers, ranchers and other professionals – is that really fair?
 
Many small business owners and others I am hearing from strongly disagree. Ironically, I am also hearing from a growing number of Liberal MPs in Ottawa who are also voicing concerns on the long-term consequences this tax increase may create.
 
I will be in Penticton to hear your concerns about how these tax changes will impact your small business or profession this Friday from 5-7 p.m. at the Day’s Inn and Conference Centre at 152 Riverside Dr.

If you are unable to attend, you can also email the finance minister at [email protected] to share your concerns. Please consider cc’ing my office.
 
My question this week relates to tax fairness.

  • Considering many of Canada’s wealthiest will still have access to tax mitigation strategies not impacted by these proposed tax changes, does that meet your definition of tax fairness?


I can be reached at [email protected] or call toll free at 1-800-665-8711.



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Kudos to Lib backbenchers

I am going to begin this week by crediting a few backbench members of the Liberal caucus in Ottawa.

A few of these MPs have been quietly voicing displeasure with the Liberals attempts to frame a proposed tax increase on small business owners and other professionals such as doctors, as being all about “tax fairness” when in reality it is simply a tax increase.

These Liberal MPs have no doubt received the same types of emails that I have been getting from accountants, who consistently provide data that the prime minister's claims on taxes paid by small business owners and others are patently false.
 
So what is really going on here?

Earlier this week, the Department of Finance revealed that the actual deficit from the 2016-2017 fiscal periods was just under $18 billion.

The good news for the Liberal government is the forecasted deficit was $23 billion. The bad news for the prime minister is that he promised a deficit of $10 billion and has still has not announced when or how we will return to a balanced budget.

Fair to say, it will not be in the year 2019 as was also promised by the Liberals.
 
Looking closer at the deficit of roughly $18 billion, two items stand out:

  • $3.7 billion in budgeted spending did not yet make it out of Ottawa. There are many reasons for this and it is not uncommon for any federal government to see delays in spending commitments.
  • The other interesting aspect of this budget deficit was that the forecasted income tax revenues actually dropped by just over $1 billion.

As you may recall, the prime minister increased income tax rates on those who earn in excess of $200,000 and they now pay a personal income tax rate of 33 per cent. As a result of this tax increase, the Liberals had predicted income tax revenue would increase by close to $3 billion.
 
The Liberals need to increase revenue to pay for their increased spending, and seeing as it has not been realized by income tax increases, the intent now is to go after those who are personally incorporated.

The challenge is, the truly wealthy, those who can take stock options at a 50 per cent reduced tax rate, are not being targeted at all by these Liberal proposed tax-fairness changes.

Instead, small business owners, the majority of whom are not among the one per cent of Canada’s most wealthy, are being targeted along with some upper middle income professionals such as Doctors.

Farmers, fisherman and other unique groups also are being targeted and impacted by these Liberal tax proposals.

The Liberals continue to insist the tax fairness changes will not hurt small business owners and other professional groups in the usual “Ottawa knows best” tone. 

Here is the problem.

Ottawa bureaucrats, majority of whom have never owned or run a business, when attempting to tell small business owners how an Ottawa imposed tax increase will impact them, tend to offend.

I know this because I hear from many of these offended entrepreneurs, every single day.
 
Worse is the Liberals have yet to explain how Ottawa bureaucrats will make arbitrary decisions on how family members of a small business may or may not be able to be paid.

Does a stay at home parent raising children and doing the books of a small business qualify to be paid?

We don’t know.

How many more Ottawa bureaucrats will need to be hired to administer these complex changes and at what cost?

Again, the Liberals will not say.

Ultimately, this issue is not about tax fairness, it is all about a tax increase and I congratulate those Liberal MPs who are admitting as much.
 
What is your opinion?

  • Do you view these tax changes as tax fairness or a tax increase?


I can be reached at [email protected] or call 1-800-665-8711.



More Dan in Ottawa articles

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About the Author

Dan Albas is the Member of Parliament for the riding of Central Okanagan Similkameen Nicola which include the communities of Kelowna (specific boundaries), West Kelowna, Peachland, Summerland, Keremeos, Princeton and Merritt.

Before entering public life, Dan was the owner of Kick City Martial Arts, responsible for training hundreds of men, women and youth to bring out their best. For his work on child safety and awareness, Dan was the recipient Penticton’s ‘2005 Young Entrepreneur of the Year’ award. Dan served as campaign chair for the United Way of the South Okanagan-Similkameen in 2006-7 and 2010-11, both times surpassing their fundraising goals.

On June 28 of 2012 Dan became one of the first MP’s in recent history to have a Private Members Bill (Bill 311) C-311 become law with the unanimous all party support of both the House of Commons and the Canadian Senate.  Bill C-311 “An Act to amend the importation of intoxicating liquors Act” amended a prohibition era law to prevented the free trade of wine over provincial borders.

Dan’s parliamentary record includes being recognized by the Ottawa Citizen in 2015 as one of only five Members of Parliament in Canada with a 100% voting attendance record.  Locally in British Columbia,  MP Dan Albas has been consistently one of the lowest spending Members of Parliament on office and administration related costs despite operating two offices to better serve local constituents.

 MP Dan Albas is consistently recognized as one of Canada’s top ten most active Members of Parliament on Twitter (@danalbas) and also continues to write a weekly column published in many local newspapers and on this website.

In October of 2015 MP Dan Albas was re-elected to Parliament representing the new riding of Central Okanagan Similkameen Nicola.  Dan is currently the Deputy Finance Critic, serving with Finance Critic, MP Gerard Deltell and sits on the Standing Committee on Finance.

Dan is honoured to serve the residents of Central Okanagan-Similkameen-Nicola as their Member of Parliament.

MP Dan Albas welcomes your input, so please contact him by e-mail, phone or mail.

He can be reached at:

Central Okanagan-Similkameen-Nicola's MP office
2562-B Main Street
West Kelowna, B.C. V4T 2N5
Email: [email protected]
Phone toll free: 1.800.665.8711
Fax: 250.707.2153



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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