Justin Trudeau says he’s paying attention to the growing dissent over his government’s controversial plan to eliminate tax incentives that he insists only benefit wealthy small business owners.
But the prime minister said Friday he “will make no apologies” for the Liberal government’s commitment to helping the so-called middle class, even at the expense of the wealthiest Canadians.
Trudeau spoke to reporters in Saskatoon, and acknowledged the backlash over what the government calls proposals to inject more fairness in the tax system by closing loopholes used by a growing number of small businesses.
“We’re doing more for the people who need it and doing less for the people who don’t,” Trudeau said.
Entrepreneurs, major industry associations, tax experts and political rivals have warned the government the three-part plan would hurt the economy and small businesses, including many whose owners would be considered middle class.
The potential changes under scrutiny include ending a practice that allows business owners to lower their tax rate by sprinkling income to family members in lower brackets, even if those relatives are not active in the business.
Another proposal calls for limits on the use of private corporations as a way to gain tax advantages when making passive investments in items like stocks or real estate.
The third change would limit the conversion of a corporation’s regular income into capital gains that are typically taxed at a lower rate.
The government has launched a consultation on the proposed reforms ending Oct. 2.
