Tech sector warns capital needed for growth will evaporate under feds’ tax plan
Changes would create uncertainty for corporate tax planning, and intensify a brain drain.
OTTAWA — The country’s fastest growing technology companies and industry investors are urging the federal government to meet the sector before going ahead with controversial tax-reform proposals.
In a letter to Finance Minister Bill Morneau, the Council of Canadian Innovators warns his tax proposals would limit tech entrepreneurs’ access to capital that’s vital for their companies’ growth and job creation.
The association also says the changes, if implemented, would create uncertainty for corporate tax planning, intensify a brain drain of tech talent away from Canada and negatively affect
Ottawa’s highly publicized investments to help high-potential firms scale up.
The letter was sent as a consultation period winds down on the proposals – which Ottawa insists would end tax advantages unfairly exploited by some wealthy business owners.
The Trudeau government has been locked in a difficult communications war with vocal opponents who argue the changes would hurt Canadians at different income levels and from many different sectors.
Morneau has said he’s open to adjusting the proposals after the consultation period ends Monday.
In its letter, the council recommended the government launch a broader, more-comprehensive review of the tax system, with opportunities for tech entrepreneurs to share their input on how the change can benefit everyone.
“It is vital that before any decisions on this file are made, the federal government meets with Canadian innovators to discuss solutions that do not hurt Canada’s job and prosperity creators in the tech sector,” said the letter, signed by CEOs representing entrepreneurs, venture capitalists and angel investors.
“This is a race to the bottom, and runs contrary to the government’s innovation and skills plan.”News from © Canadian Press Enterprises Inc. 2016