Provinces challenge Trudeau government over contentious tax change proposals
OTTAWA Provincial pressure is intensifying against the Trudeau government’s controversial tax-reform proposals, which have angered business owners, doctors and farmers across Canada.
On Friday, provincial leaders representing different political stripes — Liberals, New Democrats and Conservatives — spoke out about tax reforms recommended by Ottawa’s Liberal government.
Manitoba Premier Brian Pallister, flanked by business owners and a farmer, held an afternoon event in Winnipeg where he aired his frustration over the federal tax proposals.
On the East Coast, Nova Scotia Premier Stephen McNeil expressed concern that the changes could hurt his province’s physician recruitment efforts and hamper the ability of small businesses to create financial cushions as protection during downturns. McNeil was scheduled to meet federal Finance Minister Bill Morneau later in the day to directly convey this message.
Out West, British Columbia Finance Minister Carole James said she didn’t think Ottawa had consulted enough on an issue that has spread fears of the “unintended consequences” on small business owners.
The comments by the provincial leaders added to waves of complaints that have come from a range of sectors — as well as backbench Liberal MPs. Newfoundland and Labrador Premier Dwight Ball has also said he thinks the tax changes would hurt his province.
At issue are Ottawa’s plan to eliminate several tax incentives designed for private corporations.
Morneau and Prime Minister Justin Trudeau have argued that the tax system unfairly encourages wealthy Canadians to incorporate, so they can get a better tax rate than middle-income earners.
They say the changes are meant to end tax advantages that some wealthy business owners have unfairly exploited and to ensure all Canadians have a level playing field.
But the federal explanations have yet to ease many concerns.
Pallister added his voice to the uproar about the potential damage he believes the changes could inflict on thousands of small- and mediumsized businesses and their employees.
“There is no room here for class warfare. The communications department in Ottawa have chosen to use language like ‘loopholes, tax evasion’ — recriminatory and accusation language that has no place in this discussion,” Pallister said.
“These proposed changes will take millions of dollars out of the hands of Manitobans and deliver them straight to Ottawa.”
In Halifax, McNeil urged Ottawa not to overlook the importance of these incentives for some small business owners and doctors who lack retirement plans.