Liberal Government of Canada new stock option taxation rules attack Canada’s Innovation startups and small businesses – June 28, 2019,
I have to say that Bill Morneau is probably the dumbest finance minister in Canadian history. Bill Morneau ha been trying to make the tax code subjective in nature, to allow the government to basically pick and choose who qualifies for tax breaks. As I’ve been saying over and over again, most businesses are in debt and use the leverage of debt to finance their businesses, this is very true in tech startups that not only have to seek and attract capital but also have to find a way to recruit the top talent to their company.
Now, what Trudeau’s Liberals are doing is they want to take money EARNED from start-ups, then tax that money and force the start-up to find a way to find more capital that the government will tax again. Yes, the Liberals are saying this is about taxing big companies, but remember this is an option, that these large companies can offset in different ways, more than likely depending on the company if they’re large enough they’ll take portions of their business elsewhere.
Now, in case you’re wondering why America often attracts the talent that innovates, it’s because in America they allow for creative ways for employers to attract and retain talent. Taxation is theft, civilization can survive without government, taxes at one point were zero, the Liberals are creating a law that essentially says that if a company raises private capital, the Canadian government is entitled to tax that money. Now, I want to remind readers, that America isn’t far away, Americans speak English and currently, U.S denominated funds have more purchasing power internationally.
Now, although certain U.S States are heavily taxed, this is not the case for all of America. Canada is making this law on the federal level. We’re talking about employee stock options here, and the justification of the Liberal government taking this money as follows.
The public policy rationale for the preferential tax treatment of employee stock options is “to support younger and growing Canadian businesses.” That being said, the government “does not believe that employee stock options should be used as a tax-preferred method of compensation for executives of large, mature companies.” – Financial Post
Now, to put this in better perspective, to harm one group the government wants to prevent the practice from happening at all? The used similar wording to describe why the planned to lessen the Tax-Free Savings account created under Stephen Harpers Conservatives. Because the rich are using it, we want to end it, it’s a very short-sighted approach and again this is why I’m warning Canadians about the destruction the Liberals will cause to the Canadian economy. Now, in case you’re wondering, yes to enforce these rules more than likely Trudeau’s Liberals will have to grow the size of CRA, in fact as you know these proposals for higher taxation are created to grow the public sector. It’s a very sad day in Canada. Vote wisely in 2019!
Everything you need to know about the government’s new stock option taxation rules – Financial Post
Interesting times ahead