Finance Minister Bill Morneau plans to address “unintended consequences” of the government’s proposed tax changes on small businesses as quickly as possible, according to the Globe and Mail. He still said that it plans to proceed with the controversial plan “as expeditiously as possible.”
“We will make sure that we get it right,” Morneau said at a news conference. “So, to the extent that there’s any issue that we need to look at carefully, we will. Our view is that we need to move forward with as much clarity as we can, as soon as we can, so that businesses will have certainty.”
Morneau has said that he’s willing to adjust the tax changes to address the biggest issues raised in consultations that ended October 2.
“I think that we’ll see different people across the country with different points of view,” Morneau told the Globe. “We think that it’s important to listen, in getting to the final conclusions. But we do intend on moving forward.”
Entrepreneurs like Bruce Croxon and Allen and Eva Lau have been vocal in their opposition to the proposed tax changes. The changes include restricting the use of income sprinkling to family members, restricting the use of private corporations to make passive investments unrelated to the business, and limiting a business owner’s ability to convert income into capital gains.
The Globe and Mail reports that finance department officials are having trouble finding a solution to the intergenerational transfer problem. General director of legislation in the department’s tax policy branch Brian Ernewein that the government is looking for submissions in public consultations for inspiration.
“In the situation around intergenerational transfers … we know that we need to make sure that we don’t have the unintended consequence of making that more challenging. So getting that right will be important,” Morneau said.
Photo via The Canadian Press