UNFAIR TAXATION CORRECTION -- UNWILLING..

UNFAIR TAXATION -- UNWILLING OR UNABLE TO CORRECT
Perhaps I have misread the Canadian Government and Federal Party Leaders.
A commentary on the Canadian Governments Failure to correct
the grossly unfair policy of taxing phantom income.

By Victor Drummond ©
July 2009

From the beginning of the Federal Conservative Party 2005 Pre-election campaign the words: “Lower Taxes”, and “Canada’s Fairness Taxation Plan” have permeated nearly every public and private speech made by the Honourable James Flaherty, Canada’s Minister of Finance.

Taking him at his word was a big mistake. But Why?

He obviously does not really believe that levying huge “income” taxes on money that was never and probably never will be actual “income” is “fair”. He made that clear when he allowed the Tax Remission Order (TRO) initiated by the Hon Gary Lunn, CP, MP for the riding of Saanich Gulf-Islands to proceed to completion.

Then in spite of tentative commitments by the Right Honourable Stephen Harper, Prime Minister of Canada, who was quoted by a journalist of the Victoria Times Colonist, newspaper, as saying: “We’ll get it resolved” referring to the unfair exclusion of thousands of other victims of the same tax trap.

Instead, however, the Hon James Flaherty allowed senior bureaucrats in the Canada Revenue Agency (CRA) and in his own ministry to warn the government against proceeding to correct the problem by declaring the Gary Lunn TRO “set a dangerous precedent”.

Why the about face? At first glance I thought it was a question of political greed. But now that the economy has tanked, and the government is looking for ways to restore economic stability: even going so far as to accept a huge multi-billion dollar deficit budget forecast, the issue is no so clear.

If the government is willing to dish out billions of dollars to keep corporations alive, producing items for public consumption, why would they not also dish out “fair” and "justified" tax refunds to provide the Canadian victims, of phantom income taxation, with discretionary funds to purchase those otherwise surplus products?

The sense of this action being it would not only restore the governments credibility, and help boost the economy it would fulfill the governments commitment to provide reduced and truly fair taxation and last but not least it would restore Canada’s image on the world stage as a decent and just country governed by decent, considerate and compassionate leaders.

But not one Canadian federal party leader, or Member of the House of Commons has initiated a government, or members bill, to correct our defective “taxable benefit” legislation and fairly compensate those who have been victimized by it. Even though the United States Government has recently taken that kind of corrective action regarding their comparable defective “Alternative Minimum Tax” (AMT) legislation. Ref:- www.reformAMT.org

Now that is a mystery. There are tons of political hay to be gained for federal opposition parties by painting the current government into the corner they created via their “Canada’s Fair Tax Plan” and failure to deliver.

None of the opposition leaders or members has seized this opportunity. Why not?

This situation now raises the prospect the answer is not because they are unwilling to go this route to 24 Sussex Drive it is much more likely they all know something that no one is daring to say: They are all unable to deliver on this commitment for some obscure reason.

In order to deliver fair taxation to Canadians, that have been unjustly and unfairly taxed on phantom income, the CRA records must be in dependable condition for at least the past decade.

Even with accurate tax records it would likely take thousands of man-hours to pull back all the details of tax returns where taxing of phantom income has been a factor.

These man-hours are not the problem as the Canadian government has been generating make-work projects for years -- just to keep the employment records high and full employment on-going. This would be an excellent opportunity to keep that ball rolling.

Government failure to initiate this form of corrective action seems to narrow the field down to the government being unable to fulfill their “fair Tax” policy in this area and only the political insiders know for certain the reason(s) why.

So if man-hours are not the reason, and unwillingness is not the reason then that narrows the field down considerably. What if the necessary data is not readily available or perhaps not available under any conditions?

That could explain why requests made for phantom tax data, under the freedom of information act, have been fudged and blacked-out such that the numbers were never revealed. Ostensibly: in keeping with the policy of protecting personal confidential information.

This excuse doesn’t jell. There is nothing personal about saying there are X thousands of Canadians taxed on money they never saw -- and to fairly compensate these victims will cost the Canadian treasury $X billions of dollars.

So we are left with the possibility that I may have unfairly maligning the Canadian Federal Politicians on the ASSUMPTION they just didn’t care about the abuse heaped upon our honest, hard-working, Canadians who have been taxed into financial ruin by an indifferent, greedy, bunch of ineffective elected representatives.

Perhaps instead the problem is not greed and callous disregard for injustice -- it is fear of revealing a much bigger problem. Could the problem be: “Loss of tax data” which equals loss of control.

If, in fact Mr. Flaherty, you would have fulfilled you’re “Canada’s Fair Tax Plan” if you had the means at your disposal to do so: then just say so.

At least your personal public image and the public image of your party will improve and you might be able to blame the bungled tax record situation on a previous government, and/or some hacker(s) that managed to delete and/or corrupted the CRA tax records.

Or perhaps like the “Air India” situation the necessary tax records have all been shredded.
Things like that do happen unfortunately.

In any event you could then hire a lot more summer students to research every challenge to the tax records that such an admission would invite. In the process the damaged/lost/missing tax files would at least be updated by each challenge resolved and the 2009 summer student employment figures would also be given a much needed boost.

Let me know if I owe you, or anyone in Canada’s House of Commons, an apology.

And taking your prior advice: I won’t hold my breath waiting for that information or for any action by our current government to correct Canada’s phantom income tax problem.

And if nothing is done to correct this outrageous tax policy by the arrival of the next federal election don’t hold your breath waiting for my support, or the support of anyone I can influence to vote.

See you at the next federal election polls O’Grady.


Victor Drummond ©