Wednesday, January 27, 2010

Canada's little Dutch boy of Finance doesn't have enough fingers to plug this torrent of REAL TAX LEAKAGE

Re REUTERS Canada's Flaherty says to keep close eye on trusts [nN27174235]

If Flaherty hadn’t lied to all Canadians about tax leakage, in the first place he would have these problems to face, in the second place. Corporations only pay taxes at the blended average rate of 6.2% (Statscan) and their dividends are taxed at half the rate of income and the stock gains as well. Meanwhile trusts pay zero in taxes but THEIR OWNERS pay taxes at the rate of 38% on those same stream or earnings. What pea brain would think such an arrangement would cause tax leakage? And what loopholes does Flaherty intend to close for corporations? Surely not that huge corporate tax “loophole” known as interest deductibility. He tried that once and was burned to the ground. Is he now planning on changing tax laws pertaining to capital depreciation and tax free recovery of original investment dollars. Flaherty is an ambulance chaser-at-heart is desperate pursuit of hiding his original lie about tax leakage and all the unintended, yet totally predictable outcome of his myopic income trust fraud of a policy

REUTERS Canada's Flaherty says to keep close eye on trusts [nN27174235]

* Will seek to close tax loopholes if there are any
* Favored tax status expires in 2011

OTTAWA, Jan 27 (Reuters) - The Canadian government will
keep an eye on income trusts to make sure they do not avoid
taxes when their favored tax status expires next year, Finance
Minister Jim Flaherty said on Wednesday.
Flaherty was responding to a question, at a news conference
on Haiti, about some income trusts trying to avoid paying tax
in 2011. He said the government tries in each budget to close
any loopholes it may find.
"If there's an issue with respect to the income trusts,
then we'll look at that as well. The whole purpose of the
changes with respect to income trusts in 2006 was to ensure
that there was fairness in the Canadian tax system, and we'll
continue to aim at that goal," he said.
(Reporting by Randall Palmer; Editing by Jeffrey Hodgson)
((; +1-613-235-6745; Reuters

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Dr Mike said...

Ouch Jim , this ought to be good.

I am afraid that the fur will hit the fan on this one.

It is easy to kill the small investor , but mess with big business & it could be tits-up.

Dr Mike Popovich

Anonymous said...

It's too bad that the tax payers of Canada don't have any say in where the tax loopholes are. Just ask the people that have lost out on their RRSP investments because of the tax loopholes on Income Trusts (I mean the real tax loopholes). Why don't we start with looking at the advantages foreign companies/countries have in buying up our Trusts and paying no taxes. Isn't that a tax loophole? What is a tax loophole anyway? BB