Mayor of Slave Lake
Earlier this week, I attended an information session on the proposed federal changes to tax legislation. Now before you stop reading this I would recommend you take 120 seconds and invest the time, as it could have a significant impact on the rest of your life.
I’ll try to keep it short and sweet. You may have seen information on the news or a bunch of financial articles about this and have been wondering what’s going on. In a nutshell this is what I learned.
The Liberal government is proposing to make drastic changes to tax legislation. The last time this was done was close to 50 years ago and took them six years of tweaking. Now they want to do the same thing, during tough economic times and have determined instead of six years, 75 days will be enough. So in the middle of July (the middle of everyone’s summer holidays) they went out to the public for input.
That input will be collected until only the end of the month (September) at which point our government will push forward with their proposed changes. The government feels there are too many advantages for business owners and professionals and so they want to tax them more heavily to make the system more equal and fair. Hypothetically this seems right.
As an employee I would probably want nothing more. As a business owner myself I know better. Small to medium business accounts for 60 per cent of the economy in Alberta. These are the companies that provide the jobs.
To get into business isn’t easy and you have to take significant risk. Leveraging your personal equity, your home, your future and your children’s education to get the equity needed to start your business. You have to work long hours, doing multiple jobs and sacrifice much of your family and personal life to make sure your business is successful. For all this risk you get no pension, retirement plan, financial security whatsoever. You get no vacation pay, guaranteed holidays or sick days. You don’t get maternity or paternity leave.
If you or your staff make a mistake, nobody pays for it except you. There are no medical benefits and if the business goes under, and you lose your home, there is nobody to bail you out.
Moving forward, the government wants you to continue to take that risk but wants to take much more of your “reward” if you are successful. From that angle it doesn’t look so fair anymore.
Now if you are not a business person this probably sounds like millionaires complaining. If that were the truth, I wouldn’t be writing about it today as I would have so much money I wouldn’t really care.
What’s most important though is to make sure as an employee you understand how this affects you. Employees need jobs…does this plan sounds like it is going to encourage new business people to take that risk?
How about current business people expanding? How about a better chance for increased wages and benefits for employees when the government is taking more of the money away? How about increased donations for community groups? In reality, when businesses are forced to absorb increased expenses they do two things, either charge the customer more, or cut expenses.
The easiest expense to target is always people.
To look at this from a different angle, lets talk about health care. Over 80 per cent of all physicians in Northern Alberta come from outside of this country. They typically come with over $100,000 in debt for tuition loans. They have to risk everything to come here. They are typically not employees of AHS so have to set up their own business and contract back to the government. They get little to no time with their families and the cost of living is typically much higher than where they came from.
They too get no paid vacation, sick days, or parental leave and now we want to make it more expensive and less attractive to come here. When we have such a huge shortage of health care professionals this seems like it’s going to affect my family as much as my pocket book.
What I agree with is after 50 years, making some tweaks is never a bad idea. Things should always improve. That being said, we need to make sure we take the time to think things through to make a good decision. Hurting Canada’s economy when we have spent the last two years trying to crawl out of a hole doesn’t make sense to me. How can you help? At most, write a letter to your MP voicing your concerns.
If you don’t want to write a letter, contact the Slave Lake Chamber of Commerce and they have one ready for you. At the very least, sign one of the online petitions urging the government to take some more time to come up with a better plan.
This effort takes time, so it’s easier to just read onto something else. What I hope though is after reading this you understand that your family’s future is worth five minutes of your time.