To the Editor:
Was it accidental, negligent or deliberate?
The Harper government is clearly no fan of Co-operatives and Credit Unions. In its frenzy to slash programs and services, it has gutted the federal Co-ops Secretariat and eliminated business development initiatives. It has even attacked Co-operative housing.
Most recently, Credit Unions (CUs) have been targeted for a Conservative tax-grab. In his last budget, Stephen Harper hit Credit Unions with a whopping new tax increase. And this from someone who claims - obviously falsely - that he doesn't raise taxes!
Refusing to recognize the structural and operational differences between CUs and big banks, Mr. Harper is sticking CUs with the same tax rate as financial corporations at least 16-times larger - meaning their effective rate is ballooning by more than one-third, from the previous level of 11 per cent to a new rate of 15 per cent.
That's a huge hit, but it gets worse.
The legislation the Harper Conservatives rammed through Parliament last spring - in another odious Omnibus Bill with ludicrous limits on scrutiny and debate - imposes a new effective tax rate on Credit Unions (and ONLY on Credit Unions) of 28 per cent (not just 15). That's brutal. It would kill the sector.
This massive new CU tax was discovered and disclosed in a recent independent examination of federal budget measures by the Deloitte accounting firm.
The Finance department now says it was all just a "mistake" that they already knew about. But if that's true, why hadn't they disclosed it themselves and announced a clear plan to fix it.
It's hard to believe that such an egregious tax increase was accidental. Remember, this is a government that's desperate for cash. By hook or by crook, the Conservatives are determined to concoct the illusion of a balanced budget by 2015, which just happens to be just before the next federal election. How convenient!
So, they're over-estimating revenues, making deficient provisions against risk, counting on big programs (like infrastructure) to under-invest by large amounts, slashing a long list of frontline services, refusing to put any new money into job training, and hiking taxes. Yes, HIKING TAXES big time!
In this last budget, for example, there are new Conservative taxes not only on Credit Unions, but also on small business owners, on job creation and consumer products totalling more than $1.5-billion every year. And that's assuming the new CU tax rate is actually just the 15 per cent stated in the budget itself, and not the much higher 28 per cent that was written into their legislation.
If this rate discrepancy was deliberate deceit, it's reprehensible. If it's truly a mistake, it reflects startling incompetence.
At the bottom-line, there's no justification for any new tax burden on Credit Unions. Their effective rate should remain at 11 per cent - where it was before the Harper regime set out to punish them.
Kudos to Deloitte for exposing this fiasco.
Ralph Goodale, MP., Wascana, SK.
