Politicians advocating “tax fairness” need to rethink their strategies if Canada is to grow and remain financially healthy, financial advisors at an Advocis symposium were told Nov. 14.
“I suggest that this [current] political view of tax policy is imprecise, if not incorrect and too narrow in focus and missing the mark to achieve a better tax structure,” said Jack Mintz, president’s fellow of the School of Public Policy at the University of Calgary. “As a result we will see errors introduced, such as the recent changes to the tax treatment of private corporations, if we look at tax policy in such a distorted and narrow lens.”
Citing tax fairness, Finance Minister Bill Morneau brought in some recent tax changes for incorporated individuals, including small businesses and professionals, until a public uproar forced the government to change some of its proposals.
But Mintz said a more sensible approach has to be made to cut economic costs and reduce complexity and unfairness. Included in this approach, he suggested, is eliminating differences in income tax rates across sectors and size of business, as well as encouraging reinvestment by small business.