Finance Minister Chrystia Freeland yesterday said she will rewrite portions of a luxury tax that lobbyists called a job killer. The 10% tax on private aircraft over $100,000 was to take effect September 1..“The government intends to release draft regulations in the near term that effective September 1 would relieve the luxury tax on sales of certain aircraft for export at the time the sale is completed,” Freeland said in a statement. The finance department did not elaborate..According to Blacklock's Reporter, Parliament on June 13 passed into law Bill C-19, an omnibus budget bill that imposed the luxury tax on aircraft as well as autos that sell for more than $100,000 and boats over $250,000. The tax is worth $663 million over five years, according to a 2021 Legislative Costing Note by the Parliamentary Budget Office..“If you have been lucky enough or smart enough or hardworking enough to afford to spend $100,000 on a car or $250,000 on a boat, congratulations!” Freeland wrote in an April 19, 2021 budget document Recovery Plan For Jobs. “And thank you for contributing a little bit of that good fortune to help heal the wounds of COVID and invest in our future collective prosperity.”.Business and union executives told the House of Commons finance committee hearings the tax would cost at least 900 jobs in Canada. “This tax will destroy the industry and have job losses across the country,” testified Sara Anghel, president of the National Marine Manufacturers Association..Matt Poirier, trade policy director with Canadian Manufacturers and Exporters, testified the tax would affect “little companies that make all those parts that feed into those products,” he said. “It’s a bad idea just full stop,” said Poirier..The International Association of Machinists and Aerospace Workers in May 19 testimony also predicted the luxury tax would cost jobs. “Are we putting Canadian companies at a disadvantage globally versus competitors? To us the answer is clear: yes,” said David Chartrand, Canadian general vice-president..“Will this tax generate a loss in sales? Absolutely,” testified Chartrand. “Would this translate into job loss? If you’re selling fewer aircraft you’re manufacturing fewer aircraft, you have fewer jobs.”.Michael Wilton, president of Flight Simple Aircraft Sales of Calgary, testified at May 20, 2021 committee hearings that the luxury tax unfair. “I’ve got an airplane and I’m called the rich guy,” said Wilton. “We don’t think that’s fair.”.“I am by no means rich,” said Wilton. “My clients are pretty normal people. They’re farmers, they’re ranchers, they’re businesspeople, they own a small shop.”.“Most general aviation pilots and owners are not the ultra-rich, not even close,” said Wilton. “They are the regular folks, your neighbours, my neighbours, the people who enjoy a hobby that happens to be incredibly expensive.”
Finance Minister Chrystia Freeland yesterday said she will rewrite portions of a luxury tax that lobbyists called a job killer. The 10% tax on private aircraft over $100,000 was to take effect September 1..“The government intends to release draft regulations in the near term that effective September 1 would relieve the luxury tax on sales of certain aircraft for export at the time the sale is completed,” Freeland said in a statement. The finance department did not elaborate..According to Blacklock's Reporter, Parliament on June 13 passed into law Bill C-19, an omnibus budget bill that imposed the luxury tax on aircraft as well as autos that sell for more than $100,000 and boats over $250,000. The tax is worth $663 million over five years, according to a 2021 Legislative Costing Note by the Parliamentary Budget Office..“If you have been lucky enough or smart enough or hardworking enough to afford to spend $100,000 on a car or $250,000 on a boat, congratulations!” Freeland wrote in an April 19, 2021 budget document Recovery Plan For Jobs. “And thank you for contributing a little bit of that good fortune to help heal the wounds of COVID and invest in our future collective prosperity.”.Business and union executives told the House of Commons finance committee hearings the tax would cost at least 900 jobs in Canada. “This tax will destroy the industry and have job losses across the country,” testified Sara Anghel, president of the National Marine Manufacturers Association..Matt Poirier, trade policy director with Canadian Manufacturers and Exporters, testified the tax would affect “little companies that make all those parts that feed into those products,” he said. “It’s a bad idea just full stop,” said Poirier..The International Association of Machinists and Aerospace Workers in May 19 testimony also predicted the luxury tax would cost jobs. “Are we putting Canadian companies at a disadvantage globally versus competitors? To us the answer is clear: yes,” said David Chartrand, Canadian general vice-president..“Will this tax generate a loss in sales? Absolutely,” testified Chartrand. “Would this translate into job loss? If you’re selling fewer aircraft you’re manufacturing fewer aircraft, you have fewer jobs.”.Michael Wilton, president of Flight Simple Aircraft Sales of Calgary, testified at May 20, 2021 committee hearings that the luxury tax unfair. “I’ve got an airplane and I’m called the rich guy,” said Wilton. “We don’t think that’s fair.”.“I am by no means rich,” said Wilton. “My clients are pretty normal people. They’re farmers, they’re ranchers, they’re businesspeople, they own a small shop.”.“Most general aviation pilots and owners are not the ultra-rich, not even close,” said Wilton. “They are the regular folks, your neighbours, my neighbours, the people who enjoy a hobby that happens to be incredibly expensive.”
