One of the heated debates you’ll hear in the House of Commons over the next few weeks will focus on proposed tax reforms that the Trudeau government apparently won’t be backing off, even with objections from businesses.
You can read more about those reforms here.
The spin is that the plan is designed to close loopholes that give wealthy small-business owners an unfair tax advantage over others. Those who support these proposals will use stories such as this one to back their arguments.
That story from the left-leaning Toronto Star deals specifically with the “income sprinkling” portion included in the proposals, likely what will affect many denizens of the golf industry if these changes go through.
Income-sprinkling allows business owners to distribute money to family members who earn less and therefore, will be taxed at a lower rate.
Government arguments usually focus on well-to-do business owners who distribute money to family members who have little or nothing to do with the company as a tax dodge and that may well happen. Levelling the playing field and making the well-to-do pay their fair share is bound to make the government look good in front of voters.
In theory, yes.
What about the small family business that legitimately employs spouses, sons and daughters? It could be a golf course, driving range or golf retail shop that might be passed from one generation to the other. Family-run businesses are not uncommon in the golf industry.
Finance Minister Bill Morneau says he plans a “reasonableness” test so legitimate family businesses aren’t punished, but a fair question about that is how he plans to do that without having people at each business to observe day to day?
We may find out in the next few weeks, but for now, the federal government seems more focused on the wealthy than concerned about how it might affect smaller businesses.
How do you feel? Will the proposed tax changes unfairly impact golf businesses? That’s the question for this week’s GNN Poll.
You can vote below or on the GNN home page and please feel free to add your thoughts in the Comments section below.
Will the tax reforms currently being proposed by the federal government unfairly penalize golf businesses?
- YES (84%)
- NO (16%)