See also:Question for Amanda: What’s not to like about a retroactive double tax that’s applied discriminatorily using false pretenses?
On yesterday’s BNN show Squeeze Play, host Amanda Lang asked the operative question, which to paraphrase, was “if income trusts were shut down because of a tax advantage, then why are the pension funds allowed to keep their tax advantage?”
A perfect example is the present bid by OMERs to acquire Teranet Income Fund. Teranet income fund is taxable at the rate of 31.5% in the hands of its current public owners. OMERs will not have to pay this tax.
This is called a tax arbitrage. Government induced tax arbitrage. Such an arrangement is anything but “tax fairness” or “leveling the playing field”. So what exactly is Flaherty’s explanation for this gross disparity? Some Canadians are more important than others?
How will the ownership of Teranet by OMERs as an income trust, resolve any of the alleged problems with income trusts? It defies logic. It defies reason. What is Flaherty’s defense?
See Amanda’s comments at about the 8:10 mark at:
Bravo Amanda! Inquiring minds need to know.
Saturday, November 1, 2008
Posted by Fillibluster at 12:59 PM