TORONTO – A new bill that surrenders
Ontario’s ability to collect and audit corporate taxes will cost the
province millions of dollars a year, the Ontario Public Service
Employees Union says.
Bill 174, which cedes control of corporate
taxation to the federally-run Canada Revenue Agency, means Ontario
will have no means to independently enforce corporate tax collection
and won’t be able to audit companies.
“Right now, Ontario’s corporate tax
function is entirely funded by the penalties and interest our
auditors find, normally at companies the CRA has already audited,”
said OPSEU President Warren (Smokey) Thomas. “Our auditors recover
over $300 million in unpaid corporate taxes every year. Under Bill
174, we won’t have any way to ensure that that money is collected.
“Needless to say, the main beneficiaries of
Bill 174 will be corporate tax-dodgers in the underground economy,”
Thomas said.
In 2002, Ontario’s provincial auditor found
that half of Ontario corporations – over 350,000 of them – had
failed to file the required corporate tax returns.
“The decision to abdicate responsibility
for tracking down non-filing corporations is both bizarre and
perverse given the McGuinty government’s acknowledgement today of
the need to crack down on the underground economy, as reported in
the Toronto Star,” said Thomas.
The union is particularly troubled by the
issue of tax allocation, which determines provincial tax bills for
corporations that operate in more than one province.
“Alberta and Quebec would never give the
federal government control over provincial corporate taxes, and we
shouldn’t either,” said Thomas. “Bill 174 means we’ll have nobody
standing up for the rights of Ontario taxpayers, and this can only
have a negative effect on the money we have available to fund the
public services we all depend on.”
The union will make a presentation on
Bill 174 to the Standing Committee on Finance and Economic Affairs
today at 3:30 p.m. in Room 151 of the Main Legislative Building at
Queen’s Park, Toronto.
