Collins Barrow urges delay of private company tax proposals

TORONTO, Sept. 22, 2017 /CNW/ - Coming out of their annual board meeting, Collins Barrow is urging the Canadian government to delay the enactment of measures that profoundly change the taxation of private corporations and their shareholders, as proposed in draft legislation introduced July 18, 2017. At their Partners' Conference this past weekend, members addressed the potential implications of these proposals on Collins Barrow clients across the country.

Given the significance of these proposals and their potentially detrimental impact on the Canadian business community and economy, Collins Barrow National and all 26 member firms unanimously recommend all measures be delayed for, at minimum, one year to accommodate more detailed analysis and consultations prior to implementation.

"As a uniquely Canadian firm serving entrepreneurs and companies of all sizes from coast to coast, we join the widespread opposition to these proposals that have the potential to negatively affect many business owners and, more broadly, the Canadian economy," said Doug Kroetsch, chair, Collins Barrow National.

"In response to a firm-wide concern about the short response time allotted, we recommend extending the consultation period to accommodate a more in-depth review of the technical gaps we have identified that could prove to be deeply problematic."  

Collins Barrow is concerned not only about the proposals, but how they have been presented and what they imply. The insinuation that some taxpayers have taken advantage of clear, existing tax law, as well as the inaccurate suggestion that equates using legal tax planning methods with the use of "loopholes," are deeply concerning to the firm.

The proposals intend to modify long-standing, existing legislation in the areas of: income-splitting, holding passive investments in a private corporation, and converting a corporation's after-tax income into capital gains.

Collins Barrow will continue to follow this issue closely, providing ongoing commentary and leadership nationally. Member firms have individually undertaken efforts to promote awareness on this matter, educating clients and the general public, and will continue to unify efforts in the coming weeks.

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For more on this issue, read our August Tax Alert: Increasing the cost of intergenerational business transfers and our July 20 Tax Flash: Finance targets tax planning for private corporations.

SOURCE Collins Barrow National Cooperative Incorporated