Rich professionals could pay more taxes

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Bill Morneau

Guillaume St-Pierre

Tuesday, 18 July 2017 15:54

UPDATE
Tuesday, 18 July 2017 15:54

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OTTAWA | The Canadian Finance minister Bill Morneau wants to abolish tax loopholes used by wealthy professionals such as doctors and lawyers to pay less tax.

“Many of the Canadians who are among the richest exploit unfairly the tax rules”, stressed in a written statement the minister Morneau.

The latter, a business man from toronto performed, ironically, admitted at a press conference, Tuesday, that it will itself be called on to contribute more to the tax authorities in the future.

“I’ll probably have to pay more taxes in the future because of our changes,”-he said to journalists.

The number of private companies has exploded in Canada since the early 2000s, “a worrying trend”, according to the minister.

These companies are sometimes used as cover by their owners to pay less tax.

Thus, the Trudeau government wishes to consult Canadians in order to abolish three tax loopholes.

Ottawa wants to especially address the distribution of income within families of entrepreneurs.

The scheme is for a business owner to apportion its income within family members whose tax rate is lower, even if the latter do not contribute to society.

It is estimated that approximately 50 000 families benefit from the largesse of the system.

Secondly, the Trudeau government wants to tackle money sitting in the coffers of these companies.

These “passive investments” are subject to a tax rate much lower than income of individuals.

Finally, Ottawa wants to tighten the rules surrounding the conversion of income into capital gains.

The measures proposed by the liberals could swell the State’s coffers of at least$250 million.

In the election platform of the party, in the amount of$ 500 million was mentioned.

Mr. Morneau, however, has not wanted to advance further than the quarter-billion, when questioned about the subject during the announcement.

As to the expenses generated by the implementation of the new measures, the minister argued that they would be “really not a great thing”.

The proposed changes to the tax regime are seen as “a step in the right direction” by the opposition néodémocrate and conservative, who are waiting for actions “concrete” beyond “consultations”.