Federal Finance Minister Bill Morneau says he will reconsider the proposal related to the conversion of income into capital gains after hearing concerns from farmers and fishers. The proposal raised fears about how it could hinder the intergenerational transfer of family business, like farms.
Morneau has already said he’s listened to the worries and that technical fixes were likely on the way to address the issue.
The CFIB commends the federal government for today’s announcement that it will not move forward with measures relating to the conversion of income into capital gains.
“We are very pleased that the government has listened to concerns of business owners and has stepped back from this element of their new tax plan,” says Dan Kelly, President of CFIB, in a release. “These rules would have made it more costly for small business owners — including farmers and fishers — to sell or transfer their business to their children.”
Meanwhile, earlier this week, the government also ditched another proposed measure that would have had a negative impact on the intergenerational transfer of family businesses.
Morneau also announced this week that he will scale back a proposal to crack down on passive investment income, which was one of the most contentious elements of his plan.
The Liberals are continuing their week-long effort to adjust the proposals in hopes of calming angry entrepreneurs, doctors, farmers, tax experts and Liberal backbench MPs.