December 17, 2017 12:09 pm

‘Perhaps more information was necessary,’ Chagger concedes after small business tax backlash

WATCH: Perhaps more information was necessary on proposed tax changes for small businesses: Chagger


Canada’s minister of small business and tourism has acknowledged that the Liberals should have done their homework a bit better before proposing a series of controversial changes to the tax code last summer.

“Perhaps more information was necessary,” Bardish Chagger told The West Block‘s Vassy Kapelos during an interview this weekend.

“Perhaps we should have reached out to smaller groups before going out with a mass proposal.”

It’s unclear if either of those moves would have saved the government from the months of angry backlash around Finance Minister Bill Morneau‘s initial announcement in July.

The proposals he floated would have affected how some Canadian small-business owners are taxed, particularly those who “sprinkle” income among family members, those who use their Canadian controlled private corporation (CCPC) to accumulate savings over the long-term, and those who want to pass down their business to the next generation.

WATCH: Bill Morneau defends small business tax changes

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The government has since walked back on most of the changes, although it is standing firm on altering the rules surrounding income sprinkling.

“What I thought was really good was that we actually went to Canadians to have the conversation … to ensure that we were getting it right,” Chagger said.

“After listening to Canadians, engaging with Canadians, I believe that we came to a really good spot.”

The Liberals have tried to emphasize in recent weeks that they are reducing the small business tax rate starting in January 2018, from 10.5 per cent to 10 per cent. But the kerfuffle this fall left the government wide open to attacks from the Conservatives, who argued that Ottawa was purposely attacking small-business owners.

“I would like to reassure small-business owners that we are here to work with them, for them because we know their success is our success,” Chagger said. “I’m pleased with the outcome.”

READ MORE: What you need to know about Morneau’s changes to ‘income sprinkling’ rules

Chagger, who does double-duty as government House leader, was also asked about the amount of legislation that the Liberals have managed to shepherd through the House of Commons in their first two years in power.

The raw numbers are not particularly encouraging, Kapelos noted, with the Liberals passing 34 pieces of legislation in the same amount of time it took for Stephen Harper’s first majority government to pass 61.

WATCH: Ottawa cuts deal over marijuana tax revenue

Chagger said it comes down to a few factors, not the least of which being that the Conservatives had a running start because they had previously formed a minority government.

“We’ve had a lot more debate on legislation,” she added, noting that there were over 100 speeches in the House of Commons on the government’s bill to legalize marijuana, and over 100 witnesses appeared before committee to address the bill (the Liberals have increasingly been relying on time allocation to limit debate, however).

Once bills reach the Senate, Chagger conceded, they have also been subject to a slower process. There are currently eight bills sitting in the Red Chamber, including legislation linked to access to information, and the long-awaited air passenger bill of rights.

“I do believe that they are important to the democratic process,” Chagger said of the Senate, which is now dominated by independent senators who don’t, in theory, need to support the Liberal government’s bills.

“I would hope that they would continue working, wanting to advance the mandate Canadians gave us. They know very well that we want to move ahead on these commitments so that we can deliver for Canadians.”

— Watch the full interview with Bardish Chagger above

© 2017 Global News, a division of Corus Entertainment Inc.

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