For greater taxpayer equity in the federal tax system

MONTRÉAL, Sept. 20, 2017 /CNW Telbec/ - Within the context of the debate on the tax reform proposed by the Government of Canada, economist Jean-Martin Aussant, Léopold Beaulieu of Fondaction, Robert Laplante of the Institut de recherche en économie contemporaine, Gaétan Morin of the Fonds de solidarité FTQ, Alain Paquet, professor at the Department of Economics at the UQAM École des sciences de la gestion, Alexandre Taillefer of XPND Capital, and Sophie Tremblay, president of de Force Jeunesse have made the following statement.

Joint statement

We commend the desire of the federal government to review certain aspects of corporate taxation in order to ensure greater equity for all taxpayers.

As a result of a gradual reduction in corporate taxes over the past few years, Canada is now considered one of the most competitive countries from a tax perspective for businesses, in particular SMEs.

That said, it is clear that indefensible tax arrangements and persistent loopholes have created a disparity. While the initial intention behind many of these measures is commendable, the fact is that their use today in some cases raises an issue of fairness.

In our view, this begs the question: Does everyone really pay their fair share so that Canada can have structures and services befitting one of the most advanced countries in the world? The federal project should be commended not only for raising this question but for bravely proposing certain changes that will lead to a more just system. This is why we welcome this initiative and encourage dialogue between the government and entrepreneurs.

Of course, not everything will be resolved with the adoption of the proposed measures. Other taxation problems persist, in particular tax havens and the non-taxation of e-commerce transactions with foreign companies that result in millions of dollars in lost revenue and create an unacceptable competitive disadvantage for traditional retailers. The government will also have to close these gaps if it really wants to resolve the issue of tax avoidance in Canada.

We do not view this reform by Minister Morneau as preventing innovation or impeding entrepreneurship but rather as an opportunity to make the tax system fairer for all taxpayers, particularly the middle class. The business community may have some legitimate concerns and the federal government may have to make some adjustments in light of the outcome of the public consultation in order to achieve its objectives and maintain a tax system that promotes entrepreneurship and risk taking, both essential to wealth creation. Fortunately, this same government has demonstrated a genuine capacity for dialogue ever since its election in 2015.

Jean-Martin Aussant
Economist

Léopold Beaulieu
President and CEO
Fondaction

Robert Laplante
Chief Executive Officer
Institut de recherche en économie contemporaine (IRÉC)

Gaétan Morin
President and CEO
Fonds de solidarité FTQ

Alain Paquet
Professor
Department of Economics, École des sciences de la gestion, UQAM

Alexandre Taillefer
Managing Partner
XPND Capital

Sophie Tremblay
President
Force Jeunesse

SOURCE Fonds de solidarité FTQ