I would really enjoy the opportunity of debating someone like John Manley on his myopic views on income trusts. The debate might go something like this:
BF: “Mr. Manley, could you please repeat the comment you provided the Globe on Friday as your rationale for why double taxing income trusts with the resultant loss of $35 billion is justified?”
JM: “ "I don't think you can run an economy where you have different kinds of business vehicles that are taxed totally differently."
BF: “Mr Manley, you work for McCarthy Tetrault, a large law firm geared to corporate clientele do you not”.
JM: “Yes, I am the firm’s counsel.
BF “ Are you not aware that McCarthy Tetrault is a limited partnership, which is virtually identical to an income trust, except in name? Exactly how much tax does McCarthy Tetrault pay at the partnership level”
JM: “McCarthy Tetrault pays no taxes, but that’s different.”
BF: “Different you say. I thought you said different kinds of businesses should not be taxed differently. If that’s the case, wouldn’t it follow that McCarthy Tetrault should be taxed at the rate of 31.5% rather than zero? What’s the difference? If it’s good for the goose, surely it’s good for the gander.”
JM: “Well I was referring to a different kind of different. Not the kind of different that would affect me and my personal well being or that of my 700 law partners at McCarthy’s.”
BF: “Mr Manley, perhaps you are referring to the US version of different. Are you not aware of the US Public Limited Partnership market? This is a $480 billion public market, where no taxes are paid by the issuing entities, just the investors, making it the equivalent of income trusts before Flaherty got involved”
JM: “Of course I am aware of MLPs, but that’s different.”
BF: “Mr Manley, you seem to be having a hard time differentiating between the differences that matter and the differences that don’t matter. Perhaps you could reveal whose interests you are representing and we could better understand the cognitive dissonance that you are experiencing, since it appears that there may be a difference as to which side your bread is buttered on, now that you’ve entered the private sector.
Tuesday, September 4, 2007
Posted by Fillibluster at 10:16 PM