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Canada votes 2021: Are major corporations taxed enough? Local candidates share their thoughts

Criticism of the tax loopholes and tax havens available to corporations is widespread, but what are the parties planning to do about it?
Canada_Revenue_Agency
Canada Revenue Agency taxation centre in Sudbury. (File)

With election day on Sept. 20, the time to make a decision is upon us. To help you parse where the party’s stand on the issues of the day, we sent a questionnaire to the candidates of the four parties with a member in parliament, as well as the People’s Party of Canada candidates.

Issues we polled the candidates on were climate change, affordable housing, Laurentian University and the post-secondary sector, the opioid crisis, Indigenous issues, vaccine passports, corporate taxation, universal basic income and mental health supports.

Questionnaires were sent to all candidates, though not all candidates chose to participate. As well, some candidates did not answer all questions provided. 

Nickel Belt Riding

Does Canada need corporate tax reform and why? If not, why not?

Craig Gravelle, Green Party

Yes, Canada needs corporate tax reform and government spending reform. We must raise corporate taxes significantly. Spending must no longer overwhelmingly benefit corporations through conservative and liberal trickle-down spending measures. 

Do corporations in Canada pay enough taxes and what will your party do to ensure large corporations are shouldering a greater share of the tax burden?

Craig Gravelle, Green Party

Corporations don’t pay enough taxes in Canada. The Green Party will increase the federal corporate tax rate from 15 to 21 per cent, and impose corporate taxes on transnational e-commerce companies (Social Media, Netflix, etc) who pay virtually no tax.

Marc Serré, Liberal Party

To finish the fight against COVID-19 and build a better, fairer, and more prosperous Canada for everyone, we need to ensure corporations pay their fair share. That’s why we will raise corporate income taxes on the largest, most profitable banks and insurance companies who earn more than $1 billion per year and introduce a temporary Canada Recovery Dividend that these companies would pay in recognition of the fact they have recovered faster and stronger than many other industries. We will also work with our international partners to implement a global minimum tax so that the biggest companies in the world are not able to escape the taxes they owe here in Canada.

Sudbury Riding

Does Canada need corporate tax reform and why? If not, why not?

Viviane Lapointe, Liberal Party

An economy that works for everyone requires everyone to pay their fair share. Since 2015, we have made significant strides to make the tax system fairer and simpler, so that middle class families and small businesses are able to keep more of what they earn, while asking the highest earners among us to pay their fair share. 

 Since 2015, the Liberal government has:

  • Increased taxes on the top one per cent of earners so that middle class people could get a break. 
  • Closed tax loopholes used predominantly by wealthy individuals and companies such as the stock option deduction. 
  • Modernized the tax system to recognize the growing importance of digital tech giants and made sure Canadian companies are able to compete on an equal basis with their competitors online. 
  • Helped to set a global minimum corporate tax.

To finish the fight against COVID-19 and build a better, fairer, and more prosperous Canada for everyone, we will ask those who have done well to pay a bit more. 

A re-elected Liberal government will: 

  • Create a minimum tax rule so that everyone who earns enough to qualify for the top bracket pays at least 15 per cent each year (the tax rate paid by people earning less than $49,000), removing their ability to artificially pay no tax through excessive use of deductions and credits. 
  • Significantly increase the resources of the Canada Revenue Agency to combat aggressive tax planning and tax avoidance that allows the wealthiest to avoid paying the taxes they owe. This will increase CRA’s resources by up to $1 billion per year in order to close Canada’s tax gap.

David Robinson, Green Party

Canada need a major overhaul of the entire tax system. The last Tax Commission was in the 1960s: reform is long overdue. The corporation tax needs reform, but it is a clumsy tool and a surprisingly small part of the problem. We need to close a swarm of tax loopholes that benefit the wealthy. One of the most expensive and unfair tax loopholes is the stock option loophole. Another is Capital gains exemptions that almost entirely benefit the richest 10 per cent.  We need to work with other countries to close offshore havens, as well.

Ian Symington, Conservative Party

Corporate tax rules always need to strike a balance between international rates,  employment opportunities, impact on communities and fair share rates of return for  governments. We will provide more funding to the Canada Revenue Agency,  increasing to $750 million per year, to fund stronger enforcement of taxation for  multinational firms, taxation of large corporations, international taxation, and other  tax evasion. This cost will be more than made up for by the increase in compliance,  leading to an increase in how much the government collects of what it is owed.

Do corporations in Canada pay enough taxes and what will your party do to ensure large corporations are shouldering a greater share of the tax burden?

Viviane Lapointe, Liberal Party

Corporations in Canada do not pay enough in taxes to help Canada weather the pandemic and build bald back better for a more prosperous future for everyone. And neither to the wealthiest Canadians.

A re-elected Liberal government will:

  • Raise corporate income taxes on the largest, most profitable banks and insurance companies who earn more than $1 billion per year and introduce a temporary Canada Recovery Dividend that these companies would pay in recognition of the fact they have recovered faster and stronger than many other industries. 
  • Implement a tax on luxury cars, boats, and planes as outlined in Budget 2021.
  • Significantly increase the resources of the Canada Revenue Agency to combat aggressive tax planning and tax avoidance that allows the wealthiest to avoid paying the taxes they owe. This will increase CRA’s resources by up to $1 billion per year in order to close Canada’s tax gap. 
  • Modernize the general anti-avoidance rule regime in order to focus on economic substance and restrict the ability of federally regulated entities, including financial institutions such as banks and insurance companies, to use tiered structures as a form of corporate tax planning that flows Canadian-derived profit through entities in low-tax jurisdictions in order to reduce taxes back in Canada

David Robinson, Green Party

In 2018 we proposed raising the corporate rate to 21 per cent. It is now 26.50 per cent. The level is not our focus now. Instead we are focussed on fairness— on the overall amount paid by the people who receive corporate income of any sort. It matters that we eliminate the loopholes, that the rich pay a progressive share of their labour income, and that we tax a larger share of capital gains since it is the community that creates them, not the asset-holder. It also matters that we tax financial transactions, which are not productive, eliminate all fossil fuel subsidies, and impose a five per cent surtax on commercial bank profits.

Ian Symington, Conservative Party

The Conservative Party plans on going after wealthy tax cheats. The Trudeau Liberals recently admitted that their high-net-worth compliance program had failed to prosecute even one person over the last six years. Under Justin Trudeau, the Canada Revenue  Agency continues to go after small businesses while ignoring those rich enough to pay for expensive lawyers and accountants. Canada’s Conservatives will fix this program and ensure that the wealthy pay their fair share. While Canadian small businesses have suffered over the last year, major American tech companies like Amazon and Google have made record profits — while paying next to no tax on the money they make in Canada. It’s time for fairness.

Canada’s Conservatives will make foreign tech companies pay their fair share of taxes including sales tax and a digital services tax representing three per cent of their gross revenue in Canada if they don’t pay corporate income tax here. More broadly, Canada’s Conservatives will work with the Biden Administration and other international partners to crack down on multinational tax-avoiders to ensure they pay their fair share. 

But that doesn’t mean giving up sovereignty over our tax system. Canadians and Canadians alone determine our nation’s domestic tax policy and rates. Canada’s Conservatives strongly disagree with the Trudeau Liberals signing onto a global minimum tax rate at the G7. We’re worried about the impact it could have on tax advantages we provide to Canadian innovators, clean tech companies and small businesses. The Liberals have now abandoned their promise to cut the tax rate for clean tech, and they are happy to find an excuse to raise taxes. Only Canada’s Conservatives are looking out for Canadian jobs.