Flaherty's "Leveling the Playing Field" is a crock, suitable for consumption only by fools

Robert Milmine writes:

One would think that if the Income Trust Tax really was a levelling of the playing field then there would be no conversions at all.  That the cost of the conversion would outweigh any benefit as there would be no compelling reason to be one or the other.  This is strictly a punitive measure created to harm one group of businesses and individuals in order to enrich another group of businesses and individuals [and creating an unlevel playing field amongst investors as between the 75% of Canadians without pensions who pay the 31.5% tax and the 25% of Canadians with pensions who do not pay the 31.5% ]

Robert


Human resources firm Morneau Sobeco to convert to corporation

By: THE CANADIAN PRESS

10/03/2010 1:32 PM | Comments: 0

TORONTO - Morneau Sobeco Income Fund (TSX:MSI.UN), which provides employers with pension, benefit and other services, says it plans to convert to a dividend-paying corporation at the end of this year.

The human resources consultancy, which made the announcement Wednesday along with its latest financial report, said it will continue making monthly distributions of 7.871 cents per unit throughout 2010.

Morneau Sobeco's fourth-quarter net income was $4.2 million, up from $3 million a year earlier. Revenue increased by 1.2 per cent to $83.3 million, from $82.3 million in the fourth quarter of 2008.

For the year as a whole, the fund's revenue increased 32.8 per cent to $331.7 million from $249.7 million in the prior year, in part because of the increased contribution from Shepell-fgi, which was acquired in June 2008.

The fund's annual 2009 net income was $10.8 million, or 27 cents per unit, compared with from $8.8 million or 30 cents per unit in F2008. The per-unit profit fell because of an increase in the number of units outstanding.

Morneau Sobeco is a human resource consulting and outsourcing firm. It provides client firms with services related to pensions, benefits, employee assistance programs and workplace health management and productivity solutions.

The switch to a corporation will coincide with a change in federal taxation rules for income trusts. The changes were announced in October 2006 and many trusts have been changing their structure in response.

Its units traded Wednesday at $10.58. up 13 cents, at the Toronto Stock Exchange.