It’s safe to say lots of farmers are mad as hell at federal Finance Minister Bill Morneau and his boss, Prime Minister Justin Trudeau over the proposed small business tax overhaul.
Why is this?
Is it because they’re a bunch of fat-cat tax-cheats who have gotten their fingers caught in the cookie jar and are embarrassed that their little scams have been revealed? That’s the sense some people in the federal government have spun when they have been confronted by the vociferous reaction of small businesses across the country to the proposed changes to taxes on incorporated small businesses. Trudeau has spoken about “wealthy individuals” and the “rich” as the people who are “making a lot of noise” about the changes.
I don’t think that applies to the farmers who are outraged by this. (I don’t know enough of the millions of other small businesspeople across the country to comment on why they seem to be equally furious.) I think farmers feel blindsided, bewildered, libelled and and hoodwinked by the federal move and its approach.
If anybody needs to understand why farmers are furious, they aren’t understanding that:
- It looks pretty bad to launch the idea and the comment period in mid-July and have it end on October 2. That’s obviously the busiest time of the year for farmers and many or most won’t be able to get to their accountants or tax planners in time to get detailed advice on how it might affect them in order to provide meaningful feedback to the Finance department.
- It feels like the fix is in when the government doesn’t just post the proposals and stand back and wait for honest feedback before hard-selling the proposed legislation. Morneau and Trudeau have hardly seemed open-minded about this issue, although Morneau seems to be giving farmers’ and other concerns a more serious hearing.
- Farmers have played by the rules and been prudent in listening to professionals and lots of government advisors, incorporating their farms as the most-recommended way of passing their own farms down the next generation, preserving Canada’s family farm structure, and more sensibly establishing retirement plans for aging farmers than the formerly common previous tendency for dad to hang on to everything, keep his plans secret, dying and leaving a lot of chaos behind. Most farmers aren’t sneakily finding clever loopholes and exploiting them, they are listening to professionals who are recommending these things, and the professionals are doing their due diligence by recommending strategies that are based on rules that have been on the books for decades and which are the law.
- Farmers have made many plans based on the current rules and will need time to adjust if there is a complete overhaul. For instance, many have based their kids’ university and college education funding plans on “income sprinkling” rather than Registered Education Savings Plans or other set-ups, but that would be banned by the proposals and it might be too late for many to set up some alternative savings plan.
- It seems like a mad rush. This would be a huge change, but it looks like the government plans to push forward rapidly, with an abbreviated comment period, pre-written legislation (for some issues) and backdating of implementation dates if it eventually gets passed by Parliament.
- They’re doing this AT HARVEST?????
This move of the government’s might be playing well with many on the political left, is causing paroxysms of outrage (and malevolent glee because they think it is helping the Conservative opposition gain ground and support) on the political right, but it leaves many non-political, farm families feeling bewildered, betrayed and insulted. If you want to understand why they’re mad, that’s why.