It was January 15, 2007 that the Canadian Association of Income Trust Investors came onto the scene. And not a minute too soon, if Liberal MP Paul Szabo is to be believed.
About a year ago, the Liberals and the Bloc were attempting to get the Finance Committee to hold Public Hearings into the income trust tax. These attempts were being fought tooth and nail by the Conservatives and the Chairman of the Finance Committee, Brian Pallister.
Paul Szabo was one of a number of MPs who were not members of the Finance Committee, but who intervened before the committee in the name of CAITI and the average Canadians who are its members and called for a Public Hearing to be held. In the end the efforts of the Liberals and the Bloc were successful.
Unfortunately the Hearings were conducted in a shameful manner, as every effort was made to render them ineffective. It was no surprise to anyone who participated in the hearings, that about three months later it was revealed in the press that the Harper government had prepared a 200 page manual for Committee Chairman on how to render these committee as ineffectual as they can be in order to force the government’s agenda. Virtually every tactic in that manual was in full display. The Committee Report was entitled Taxing Income Trusts: Reconcilable or Irreconcilable Differences?
The public hearings ultimately gave rise to the Liberal’s position on income trusts as well as the Green Party. In light of the $65 billion in trust tax related takeovers and the $1.4 billion loss in annual taxes these takeovers have induced, both of these parties are calling for a public inquiry specifically focused on alleged tax leakage. That proposition has been put to the Finance Committee and to be debated when Parliament resumes on January 28, 2008.
Within the first two weeks of CAITI”s existence we had over 5,000 individuals join as Founding Members , either as Income Trust Investors or Concerned Canadians. We received thousands of letters and emails. Here’s a good example of one received a year ago today:
Brent, I wish to congratulate you and your associates on your initiative at http://www.caiti.info/index.html
A voice on behalf of Income Trusts generally may prove invaluable.
To the extent meaningful representation can be made to the Commons Finance Committee, perhaps all or most of the punitive aspects of the so-called Tax Fairness Plan can be eliminated.
I do not profess to be particularly knowledgeable about the viability of Income Trusts as a segment of the larger capital market in Canada, but most of what I have read suggests there is a place at a much higher level than was most recently being contemplated with the Telus, BCE and Encana conversions.
I have read your consultation paper to the Department of Finance relative to the previous government initiative to resolve income trust confusion.
Contrary to conventional wisdom, I do not believe the intention was to dismantle the sector, but rather to simply get a handle on the whole affair.
So much conflicting information in the public arena, but not much based on clear cut evidence.
The Al Rosens and Professor Mintz's with their doomsday scenarios, and the Income Trusts with their claims of productive economic contribution.
The previous government was wise to take steps to better understand. They just didn't seem to do it as well as they could have.
Personally, I have very little exposure to Income Trusts.
My inner rage comes from what I perceive to have been an outrageous fraud perpetrated on Canadians.
To watch as the government tried to support their breaking of a substantial election promise without substantive evidence was unbearable.
Their resort to hyperbole and fear to justify their action was highly insulting. Reminiscent of George Bush and Iraq.
To claim "Clear and Present Danger" was offensive in the extreme.
To throw a pittance at Seniors to offset the hurt was cynical in the extreme.
And finally, to claim their actions took great courage was simply incredible.
I was astounded to learn that Gwyn Morgan and Murray Edwards were two of the very first to claim the government plan was good public policy.
Not until I looked at how both would have to start paying substantially more in current income taxes based on their holdings (should either of their companys decide to convert to trusts) did I realize why they may have been so inclined to offend so many of their contemporaries.
This is not to say they should not legitimately have a voice. Just not when their personal well-being is being so substantially protected at the expense of the Canadian tax system generally, and Income Trusts/Investors specifically.
Following the Dec 22/06 Calgary Herald editorial coming down on the side of the government I decided to establish a discussion thread on Canadian Business Online.
You may view it at http://forums.canadianbusiness.com/thread.jspa?threadID=8442&tstart=30
I have a fairly extensive list of parties that I like to copy on these messages, and am taking the liberty of doing so with this message.
Hope you don't mind too much.
One in particular, a College Professor from Sudbury, Ont. was particularly injured by the Halloween Massacre.
I have also decided to include the Calgary Herald for what it is worth.
As far as I can determine, they consider the issue non-existent.
Best wishes for what you are doing.
I will now go and sign up to be a founding member.
Monday, January 14, 2008
Posted by Fillibluster at 8:32 PM