Feds provide more details on revisions to controversial tax proposals
OTTAWA — The federal government released more details Wednesday on changes to its controversial tax proposals in hopes of further addressing deep concerns over reforms that have angered the small-business community.
The Liberals unveiled tweaks to a proposal that, as of Jan. 1, would tighten existing rules enabling small-business owners to lower their tax burden by sharing some of their earnings with family members — a practice known as income sprinkling.
The changes are designed to make it more difficult for owners to share their income with relatives who do not make significant contributions to their companies.
“For those that are passing income to family members that aren’t involved in the business, it’s clear that that’s no longer going to be considered appropriate,” said federal Finance Minister Bill Morneau, who insisted the changes would create new hurdles for about 45,000 business owners, less than three per cent of Canada’s total.