Bombardier has a lot of nerve.
It operates subsidiaries in Luxembourg and other tax havens to reduce the share of taxes it pays back home. Its top management have $18Million in stock options among them – qualifying for a loophole which makes a good chunk of that income tax free. CEO Pierre Beaudoin was recently named to the list of Top 100 most highly paid business leaders.
Bombardier and its big bosses are the epitome of taking corporate welfare while shrinking their tax responsibility. Yet this week it was revealed that they will, once again, brazenly take regular taxpayers’ money for a “repayable” loan to improve a product line. The Liberal government has imposed no conditions to this loan.
“The government is transferring taxpayer money right into the pockets of wealthy,” says Dennis Howlett, executive director of Canadians for Tax Fairness. “Bombardier’s big bosses say that this loan will help with a big sale resulting in more tax paid to the Canadian and Quebec governments. Nothing in their history bares this out.”
Howlett points out that Bombardier’s tax haven activity was exposed several years ago in the Luxembourg Leaks – when whistle-blowers released the records of companies and banks who were engaged aggressive tax avoidance As one McGill University professor of finance put it at the time:
“Luxembourg is just one big tax shelter. The only reason you go there is you’re screwing your home country, your own government.”
Bombardier is just the tip of the iceberg when it comes to aggressive tax avoidance. Canadians for Tax Fairness has been calling for the government to
- clamp down on the corporate use of tax havens
- to make it harder for tax haven-using companies to do business with the government
- and to axe the stock option loophole
The Bombardier example is just one way poor tax policy is hurting Canada. Help us push the government to change the rules and create a fair tax system. Please donate.