OTTAWA, November 20, 2013 - Canadians for Tax Fairness called on the federal government to close a number of unfair and ineffective tax loopholes in its presentation to the House of Commons Finance Committee Pre-Budget Consultations.
"The two most important steps the government could take to make our tax system fairer would be to close the unfair and ineffective tax loopholes and tackle the problem of tax evasion facilitated by tax havens," Dennis Howlett, Executive Director of Canadians for Tax Fairness told the Finance Committee.
Howlett said, "The most unfair tax loophole is the Stock Option Deduction that allows high paid company executives and directors to pay half the rate of tax on their compensation that is given in the form of stock options. This policy exacerbates the problem of growing income inequality, when governments should be doing more to close it."Stock Options Deduction costs the federal government $785 million a year. If losses to provincial governments are added in the total revenue loss tops $1 billion. "How can we justify subsidizing the incomes of the wealthiest Canadians and then claim that we don’t have the resources to end child poverty or ensure clean drinking water for aboriginal communities?" Howlett told the Committee.
Other tax loopholes that were singled out for elimination were the Capital Gains Deduction and the Business Entertainment Expense Deduction. These cost $8 billion and $400 million respectively.
The presentation to the Finance Committee titled, Close More Tax Loopholes, Simplify Tax System and Reap Revenue Dividends, can be found here.
Send a message to Finance Minister Jim Flaherty and members of the Finance Committee supporting our call for closing tax loopholes.
A fact sheet on the Close Tax Loopholes campaign is also available here.