It must have seemed like..

IT SEEM TO BE A GOOD IDEA AT THE TIME
Further commentary of the official defence of bad laws.
By Victor Drummond ©
June 2008

Both Liberal and Conservative, Federal Political Parties, have used the argument that because the defective taxable benefit legislation – you know – the one that levies huge taxes on fictitious income – must be a good law because it has been in operation for a considerable length of time.

As pointed out in the prior posting “There is a Best Before Date”, (BBD), which makes the point that the longer something has been hanging around the more likely it is past its BBD.

Just the other day our Prime Minister, The Most Honourable Stephen Harper, was loudly praised – both in Parliament and publicly – for admitting the, very long standing law, by which aboriginal children were legally taken from their parents and sent to residential schools -- for conversion to something else – was indeed a very bad law.

Initially, however, it must have seemed to be a good law at the time it was passed by the parliament of Canada.

It took some 50 years to have that law ignored and another 47 years before it was publicly acknowledged to be a very bad law with an apology from Canada’s Prime Minister to those victimized -- who are still living.

This record is not very encouraging to Canadian taxpayers victimized by the defective taxable benefit legislation – which revealed its insidious nature in the year 2001.

By the foregoing account that leaves another 90 years, or so, before the government gets around to fixing the problem and compensating the victims – or their descendants.

Things may look a bit better if we review the Japanese Canadian Victims of the WWII anti-sabotage panic that led to thousands of innocent Canadians, of Japanese descent, being legally robbed of their property and sent to concentration camps well away from the West Coast of Canada.

It must have seemed to be a good idea at the time – and it only took about 45 years, or so, before the current government apologized and provided some form of compensation to the surviving victims.

If this incident is used as a guideline then the current taxable benefit victims, or their survivors, should expect to receive their apology and reasonable compensation around the year 2042.

When unforeseen detrimental effects -- of any law – become apparent why should it take people -- in a position of authority -- so long to admit it is a bad law take immediate corrective action?

In December 2006 Conservative, Member of Parliament, Gary Lunn proudly proclaimed “It took a change of government to get someone to listen, but the Prime Minister has come through and delivered tax relief on this issue.” He was speaking about a tax remission order, (TRO) he succeeded in having passed to correct the unfair, unjust, unreasonable, insidious and punitive tax levied on some 30 former employees of the SDL Optics/JDSU plant in his riding. If this law is bad -- in this instance -- then it is a bad law in all similar cases.

If the Prime Minister, and the Governor General for Canada, both recognized the taxable benefit legislation was a bad law, which they must have when they signed the Tax Remission Order, (TRO) (See Canada Gazette, 14 Nov 07 issue), why didn’t the government follow through with a bill to correct the law and compensate those already victimized? Could money have anything to do with the delay – do you suppose?

The United States Government faced the same problem when correcting the unforeseen conditions where many American Taxpayers were taxed -- on money never received – under the “Alternative Minimum Tax Legislation”, (AMT).

The AMT was eventually recognized as a bad piece of legislation, in its original form, and changes were made to:- (1) give tax credits to those taxed on phantom income”.
(2) Victims of the AMT could use the tax credits – initially at the rate of 5% per year against following year’s taxes, and (3) the Kerry-Lieberman Bill will increase the credit rate to 20% per year with any unused tax credits refunded in cash by the end of the fifth year.

If Canada can not afford to cancel all deferred taxable benefits taxes, levied on phantom income, with refunds to those who have already paid such taxes – then they could at least correct the defective legislation and issue tax credits having distributed annual application in order to spread the monetary loss over several years – as the Americans are doing.

Should you agree it is unreasonable to keep the defective taxable benefit legislation in operation and that its victims should be relieved of the distress this financially ruinous tax levies has caused – then kindly contact your candidate for election in the coming federal election and tell them:- “Commit to correcting the defective “taxable benefit legislation, and compensate those already victimized, if you or your party want my support.”

If not already familiar with this issue – visit the “Canadians for Fair and Equitable Taxation”, (CFET) web page at http://www.cfet.ca

Victor Drummond ©