More time needed
Opposition calls for province to support delay in implementing federal business tax changes
Opposition Leader James Aylward challenged Premier Wade MacLauchlan on Tuesday over why he has not taken a public stand against the federal government’s controversial proposed business tax changes.
The changes elicited strong public outcry from business groups and corporations, forcing Ottawa to revise and soften its plans for some of the proposed changes.
During question period, Aylward asked MacLauchlan why he did not speak out against the Trudeau government’s tax proposals when so many Island business owners were expressing deep concerns.
MacLauchlan said he did send letters to Federal Finance Minister Bill Morneau expressing concerns about the reforms, notably on how they could have affected farming and fishing businesses passing between family members.
“Now, I’m pleased to say… the federal government indeed changed that policy,” MacLauchlan said.
But Aylward noted business owners remain concerned, especially about new income sprinkling rules. Draft legislation is expected to be released in January.
The Canadian Federation of Independent Business (CFIB) issued a letter to provincial and territorial finance ministers, who met in Ottawa earlier this week, calling on all provinces to urge the federal government to delay the implementation of any changes to income sprinkling rules to Jan. 1, 2019.
The CFIB is concerned that new rules on income sprinkling won’t take into account many of the formal and informal ways family members participate in the business, particularly the role of spouses, the federation stated in a news release issued Monday.
Business owners are worried they could see their red tape burden increase in order to prove their family members make a “meaningful contribution” to the family enterprise.
Aylward pressed the province to support the CFIB’s call for more time before any federal tax changes are implemented.
“Less than three weeks is not enough time for small businesses to get prepared for these changes,” Aylward said.
“Will you stand with our small business community and commit your support to delaying these changes?”
MacLauchlan reiterated he did send letters of concern to the federal minister in the fall, and since then he believes more clarity and “a great deal of stepping back” has resulted from the federal government.
“I did, at that time, ask or suggest that more time be taken,” MacLauchlan added.