Tuesday, July 18, 2017

Ottawa targets income ‘sprinkling’ loophole that lets wealthy Canadians reduce tax bill

Finance Minister Bill Morneau
A new federal blueprint for closing tax loopholes unfairly benefiting the wealthy will target Canadians who use private corporations to “sprinkle” income among family members to lower their collective tax burden, according to a Department of Finance document obtained by the Toronto Star.

Finance Minister Bill Morneau is scheduled to unveil a package of proposed reforms at a press conference Tuesday morning, part of an ambitious commitment to crack down on tax avoidance and evasion that emerged in the aftermath of the Panama Papers.

“There are signs that our system isn’t working as well as it should, specifically when it comes to private corporations,” writes Morneau in an opening letter contained in the 63-page report. “There are worrying trends. There is evidence that some may be using corporate structures to avoid paying their fair share, rather than to invest in their business and maintain their competitive advantage.”  (more...)



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