Here’s your chance to remind Justin Trudeau of his promises to close the stock option tax loophole. Remind him that failure to keep his word is costing billions. He chose to keep this perk for wealthy CEOs while telling us we can’t afford Pharmacare, a childcare program or many of the other investments that would make Canada stronger. That’s just not right.
OTTAWA - Documents that show that Finance Minister Bill Morneau knew that most of the benefit of the stock option loophole fell to a small group of very wealthy CEOs and that he received “urgent” messages from business lobbyists days before the federal budget, raises serious questions about the influence of Bay Street within the Liberal government.
“The Prime Minister campaigned on a promise to get rid of the stock option loophole which has put billions back into the pockets of wealthy CEOs including bank presidents, real estate moguls and heads of powerful multinationals,” says Dennis Howlett, president of Canadians for Tax Fairness. “Those guys send their lobbyists to talk to the Finance Minister and – just like that - their commitment disappeared.”
Earlier this month the Toronto Star published an editorial calling on Justin Trudeau to make tax fairness a priority for 2017. The editors argue that fixing the tax system would help restore confidence in the leadership and vision of the government. Good politics. But let's talk money for a moment.
Canada would have billions in increased revenues each year if the government gets serious about tackling tax havens and plugging loopholes like the stock option deduction and a host of others that have us hemmoraging money. Right now that money goes straight into the pockets of very wealthy individuals and corporations who are playing the system. Why is this even an option for our political class?
In Canada, there is one set of tax rules for corporate insiders, another for the rest of us. The stock option loophole is among the more blatant examples of this lopsided state of affairs.
It is a favourite of bank presidents and other wealthy CEOs. Under current tax laws, they can be paid in stock options and later cash them in, drawing millions in income. But, unlike a regular salary, the first 50 per cent of stock option income is tax free. What’s not for these guys to love?
Cameco’s $2.2 billion tax trial starts today in Toronto. The same day that MPs from the Parliamentary Finance Committee are in Regina to consult with taxpayers about how to manage priorities in the next federal budget.That committee need only look at the Saskatchewan case to get a clear roadmap about how to proceed.