Lawyers support proposed small business tax reform
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September 22, 2017
Dear Minister Morneau,
We, the undersigned lawyers, write in support of the government’s small business tax reform proposals outlined in the consultation paper, “Tax Planning Using Private Corporations”.
The Canadian Bar Association (“CBA”) has publicly opposed these reforms. But the CBA does not speak for all lawyers on this issue. In fact, there was no meaningful consultation with the CBA membership, so it is not clear what mandate the CBA has on this issue at all. Many lawyers are upset with the position the CBA has taken, and have expressed this view publicly and privately. Despite this, the CBA has maintained its position and asserted that it does so on our behalf. We write this letter to set the record straight.
Many members of the CBA are dismayed that the organization has neglected its role as an advocate for matters directly connected to the legal profession and has decided instead to use its resources to act as a tax lobby group. Lawyers are among the most privileged members of our society. That privilege comes with an obligation to use the privilege to serve the public, not to protect the narrow financial interest of the elite.
We are puzzled that the CBA would address this issue at all. The proposed reforms do not target lawyers. Indeed, they would affect only a relatively small proportion of all lawyers who are equity partners or sole proprietors. Salaried lawyers of any kind (law firm associates, government lawyers, in-house counsel, etc.) have no financial interest in these issues at all.
We support the government’s proposed reforms to bring greater fairness and neutrality to the Income Tax Act. Incorporation is an important legal structure in powering economic growth, but it should not be allowed to grant unlimited RRSPs to some Canadians but not others. The CBA does not speak for us.
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