Monthly Archive: August 2017

Proposed Tax Changes – “Conversation” with my MP (Karina Gould)

On July 18th, Finance Minister Bill Morneau released a detailed package of tax changes affecting small business.  On July 19th, I wrote to my MP (Karina Gould from Burlington, Ontario).  With only a 75 day consultation period, it took 42 days for my MP to respond.  Below is my email thread with my MP:

1. Initial Email sent to my MP on July 19, 2017

Good afternoon Karina.

We met back in May at the CALU reception.  I am a Burlington native (click here) and we chatted very briefly before going separate directions.
As you already know, the Liberal Government has announced an upcoming tax proposal “for the wealthy”.  
Given the demographics of our city, this topic is going to create A LOT of anger and frustration.  In fact, I have over 2,200 linkedin contacts who are largely business owners, lawyers, accountants and other financial planning experts, and we overall agree that this announcement is absolutely terrible for Canadians.  In fact, I would recommend reading the following article and related comments.
Karina, I’m 38 years old and been doing more advanced financial planning my entire career (15 years now).  I remember back in 2006 when the government refused to give physicians a pay raise, so instead allowed them to dividend sprinkle to family members to ‘stimulate’ savings and earnings.  Here we are 11 years later, and commonly used ‘basic’ planning is under attack.  I have NEVER written an MP, but this measure is going too far.
I’d be more than happy to be the point person for a debate.  I have a strong and very educated network dying for their voices to be heard.

Talk soon.

2. Response from MP Karina Gould on August 29, 2017

“Dear Mr. Laundry,

As the Member of Parliament for Burlington I would like to thank you for taking the time to write to me regarding the ongoing consultations on tax planning using private corporations.

The Government of Canada is working to create and economy that works for the everyone, and where businesses- both large and small- have the confidence to invest, grow, and create good jobs.

Since coming to office, the Government of Canada has taken clear action to support Canadian businesses, the drivers of growth and creators of good, well-paying middle class jobs. We have made critical investments in our infrastructure, and are supporting innovation throughout our economy. We have ensured that Canada continues to have the lowest small business tax rate in the G7

These efforts are having an impact. Canadians are among the world leaders in the number of companies started, per capita. In the past year, the Canadian economy has created more than 300,000 new jobs. The International Monetary Fund has praised Canada’s economic model and predicts we will lead the G7 in growth for 2017. The potential changes being discussed as part of this consultation will maintain this advantage and will not impact the ability of Canadians to invest in and grow their business.

This is why the Government of Canada is consulting on proposed changes to the tax regime. We want to ensure businesses continue to invest in themselves, but close loopholes that are unfairly used. To ensure that this is done fairly, the Government of Canada wants to hear from you. If you would like to submit information to the Tax Planning Using Private Corporations consultation please visit the website found here. This consultation concludes October 2nd, 2017.

Once again, thank you for taking the time to write to me regarding the ongoing consultations on tax planning using private corporations. I encourage you to continue to write on the issues that matter to you. I hope this addresses your concerns.

Hon. Karina Gould

Member of Parliament, Burlington”

3. My Response, sent August 29, 2017 (11 minutes later)

“I need the government to explain how these are “loopholes”.  The tax policy has been in place since 1972.  In 2006, the Federal Government (Liberals) would not increase the pay of physicians in Ontario.  As a result, the government allowed Medicine Professional Corporations to use dividend sprinkling and other commonly used tax planning strategies (which are being targeted) as a solution to negotiations with the Ontario Medical Association.

Karina, I invite you to my brand new office (located in Aldershot), to sit with myself and 3 other tax experts to explain our position.  I think once you learn about the real-world implication of this poor initiative, you’ll understand how it affects your constituents in Burlington.
My office is 678 Spring Gardens Road (next door to Easterbrooks).  Can we pick a date and time?”
My email from August 29th was opened at 2:01pm (emailing tracking software).  As I write this entry at 4:30 on August 30th, I have yet to get a response.  Let’s assume that Karina is on vacation for the rest of the week (like many of us) and not return to the office until Tuesday September 5th.  That would be 49 days before I had any meaningful response to my invitation to discuss these changes in person.
Moreover, it seems that I received nothing but a template Liberal government response.  Have others received similar (or the same response)?
What a joke!