Finance Minister Bill Morneau, House of Commons Finance Committee chair Wayne Easter
Changes to the tax system proposed by the Liberal government on July 18 are expected to be hotly debated when Parliament resumes sitting this week.
As reported by the CBC, the proposed changes include:
- Eliminating income sprinkling, which allows incorporated small businesses to shift income to family members who don't necessarily work for them.
- Eliminating the ability to convert a corporation's earnings into capital gains, which are taxed at a lower rate.
- Reducing the use of private corporations to make passive investments in stocks and real estate.
The Toronto Star reports, "Taken together, the package could save Ottawa hundreds of millions of dollars annually."
Halifax-based Canadian Centre for Policy Alternatives economist Lars Osberg says, "What these measures are designed to do and do do, is tax very aggressive tax avoidance at the top of the income distribution."