Thursday, October 11, 2007

Stéphane Dion speaks to the Edmonton Chamber of Commerce

Excerpt from Oct 10 Speech:

"In eleven years in politics, I have never broken my word. I will be a Prime Minister that you can trust. And speaking of trusts, let us talk about income trusts. As Prime Minister, I would never have assured investors, particularly our country’s seniors that it was safe to invest in income trusts if I didn’t mean it. Stephen Harper promised you he would not tax income trusts. But on Halloween last year, the Prime Minister imposed a punitive 31.5 per cent tax, immediately wiping out $25 billion of Canadians’ savings.

Imagine saving carefully your whole life only to see your hard-earned money vanish in one night because of a politician’s broken promise.

In the past year, we have seen many of Alberta’s strongest companies taken over by foreigners, after being weakened by the same broken promise.

Only last May, we urged the government to do something about foreign takeovers. They completely ignored our call, accusing us of being protectionist. Finally, yesterday they started to move and why? Because they know we were right and perceived as such by Canadian voters.

Now that the government is finally acting they must go further and adopt the Liberal income trust plan to fix the mess they created.

As many of you know, we have proposed to replace Harper’s punitive 31.5 per cent tax with a more modest 10 per cent tax that is refundable for Canadian investors. Experts like Yves Fortin have said that our plan will more than reverse any potential tax leakage. Gordon Tait of BMO Capital Markets and Dirk Lever of RBC Capital Markets agree we will restore up to two thirds of investors’ lost value. Unfortunately this plan can only help those trusts that have not been taken over since Halloween of last year. The longer we wait to adopt the Liberal plan, the worse it will get."

Read the complete speech

Taxation of Income Trusts, is it worth the cost and the turmoil? - Yves Fortin
A recipe for tax revenue loss - Yves Fortin
The Inconvenient Truth About Trusts - Gordon Tait
Deep Dive into Tax Issues: Canadian Pensioners Taxed Twice on Canadian Corporate Dividends - Dirk Lever
Digging Deeper - Cameron Renkas