Techopia Live dug into the federal government’s proposed tax changes for small business owners this week.
The government says its proposals, which include measures to halt income sprinkling and passive income investing in business, are aimed at restoring “fairness” to Canada’s tax regime. The tax changes are currently under a 75-day consultation period, and business advocates have not been shy in sharing their opinions.
We talked to three experts who outlined how these changes might affect SMEs and professionals, and how they hope the dialogue surrounding “fair play” might change in the future.
OBJ360 (Sponsored)
The changing landscape of termination clauses: What employers need to know
An annual review of your company’s termination clause might seem like an afterthought in the day-to-day running of a business, but it could save thousands of dollars and many headaches.
Giving Guide: Royal Canadian Naval Benevolent Fund
What we do The Royal Canadian Naval Benevolent Fund (RCNBF) stands as a beacon of support within the naval community. Over 82 remarkable years, the RCNBF earned the trust of
John Reid, CEO of the CATA Alliance, told Techopia Live that he was frustrated by the timing of the proposals, which dropped in the middle of most tech advocates’ summer vacations.
“There’s a matter of process here, and fair play. Something this significant, we should be spending longer than 75 days,” he said.
Susan Richards, CEO of Givopoly and Numbercrunch, also questioned the government’s view of “fair play.” The measures, which she says treat entrepreneurs the same as their employees, ignore the risks business owners take, such as loans and maxing out credit cards, just to pay salaries.
“They put a lot on the line. At the end of the day now, they have followed best practices … now we’re in a situation where those best practices that they have followed will be negated. It questions fair play.”
Perley-Robertson, Hill & McDougall associate Alanna Mar agreed with Richards, telling Techopia Live that if the changes are implemented, SMEs will have to significantly reconfigure the tax structures of their businesses.
Mar notes, however, that it will be interesting to see whether the government holds firm to its proposals after the Oct. 2 deadline for submissions, given the strong public backlash from professionals and business owners.
“I think you’ve seen a big reaction to this. It will be very interesting to see what changes, if any, are made. These are currently just proposed changes.”
Richards offered a silver lining, suggesting that the discussion arising from these proposals has reaffirmed the challenges and needs of being an entrepreneur. In the future, she hopes this experience will be used to establish what “fair” means to different people.
“This is a huge economic engine for Canada. We just need to work together to figure out what fairness means.”
To hear the whole conversation on the future of Canadian entrepreneurship in light of proposed tax changes, watch the video above.
