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Background > Energy Trusts say Finance Committee gets it right

Media Release

ENERGY TRUSTS SAY FINANCE COMMITTEE REPORT GETS IT RIGHT   

 

Calgary, AB – February 28, 2007:  Based on leaked information to the media, the Canadian Coalition of Energy Trusts believes the recommendations of the Standing Committee on Finance concerning the Harper government’s Tax Fairness Plan is a giant step forward on getting it right.

The key recommendations by the finance committee are in bold followed by the Coalition’s position:

 

The government should release the data and its methodology for scrutiny.  The Coalition and others have sought this information since the October 31st government announcement and the data has been purposely withheld.

Income trust legislation should be a stand-alone bill. This is an important piece of legislation that has thus far caused billions in losses to innocent Canadians and other investors. This legislation warrants being considered independently.

There are superior and less damaging ways of handling the income trust issue and recommends the Liberal solution of:

    • Replace the 31.5 per cent tax regime with a 10 per cent tax paid by companies and refundable to Canadian investors
    • Continue with the ban for the formation of new trusts but consider representations from sectors that can conform to specific criteria notably preserving the strengths of the energy income sector.

The report also recommends the Bloc position of extending the 4-year grandfathering period to 10 years.  These are considered steps in the right direction and the Coalition is calling upon government to act.

“At last we have had meaningful consultation on the proposed change in tax treatment of trusts,” said Sue Riddell Rose, Co-Chair of the Coalition of Canadian Energy Trusts. “The finance committee review considered expert testimony on many sides of the issue and the committee found compelling evidence to put forward these recommendations. Now, we hope government will listen to the findings and modify its position.”

The Coalition presented to the finance committee an in-depth report that outlined the unique nature of energy trusts in Canada and their strong case for receiving the same exemption as that granted to Real Estate Investment Trusts. Expert witnesses offered advice and investors displayed the negative impacts placed upon millions of hard working Canadians.

“It became abundantly clear that the government’s decision was made in haste and without all the facts,” noted Riddell Rose. “It is difficult to know what information drove the government’s action because it refuses to release any new data to support the Tax Fairness Plan.”

The Coalition will thoroughly review the Finance Committee recommendations once received. The Coalition’s goal of seeking full energy sector exemption remains and meetings with government members will be scheduled by the Coalition in an effort to continue the consultation process and to encourage amendments to the proposed Tax Fairness Plan.

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For further information:

Daorcey LeBray

Communication Incorporated

403.266.2000                               

dlebray@comminc.ca

Information about the Coalition can be found at: www.canadianenergytrusts.ca          

 


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