Jim Stanford had this to say today in a CAW press release on the findings of the Red Wilson panel:
"We need an investment policy that better regulates foreign takeovers and that allows Canadians to capture a larger share of the value of Canadian resources."
How very hypocritical, since it was Jim Stanford who also praised the double taxation of income trusts held by average Canadians in the only retirement vehicle broadly made available to them, namely RRSPs.
What Jim Stanford was doing wading into the arena of tax policy as it pertains to public income trusts is beyond me. Jim Stanford has demonstrated that he knows virtually nothing about how capital markets function and even less about the true level of taxes that Ottawa collects from income trusts. His blind dogmatic approach to the topic of income trusts and his support for the actions of Jim Flaherty means that he had supported the very opposite outcome that he is espousing above.
The double taxation of income trusts has INDUCED foreign takeovers. Seven of the largest 25 takeovers of the last five years can be tied to the income trust tax blunder. Has Jim Stanford heard of BCE? On the topic of the energy sector that Jim Stanford has wrapped his arms (but not his mind) around, he needs to realize that 20% of Canada’s oil and gas sector and 80% of Alberta’s energy infrastructure sector reside in public trusts. Their significant devaluation since Halloween 2006, that persists to this day, has made them sitting ducks for foreign takeovers.
Jim Stanford’s dogmatic support of the double taxation of income trusts has been the very policy that led to Prime West Energy, a $5 billion Canadian company being acquired by Abu Dhabi Energy, a middle eastern oil company. Also the trust tax has INDUCED the takeover of TransAlta Power by Hong Kong billionaire Li Ka Shing.
Canadian investors in these two companies were shunted aside in favour of foreigners because of a tax policy that favours foreign investors to domestic investors...so much for Jim Stanford's comment about the need for "Canadians to capture a larger share of the value of Canadian resources." No doubt he had manufacturing jobs in mind and not the sourcing of retirement income for the 75% of Canadians without employer pensions Do you suppose the CAW pays Jim Stanford a pension?
Perhaps Jim Stanford needs to perform a little research into the “unintended consequences” of policies that he blindly supported. He might want to start by visiting www.caiti.info where a wealth of information from very credible sources is available. He might want to start by reading the section entitled Income Trust Mythbusters.
At the very least, Jim Stanford needs to read the Deloitte study entitled
Income trust buyouts: Lots of activity, little tax revenue
We look forward to the CAW’s revised policy position on income trusts, otherwise grand pronouncements like those in today’s CAW press release are simply pandering feel-good rhetoric, devoid of purpose and lacking in resolve.
Friday, June 27, 2008
Posted by Fillibluster at 9:00 PM