Letters and Tweets — August 2014

Readers respond to the June 2014 issue of CPA Magazine via mail and Twitter.

Taxes to grind

I was dismayed to read that [CPA Canada] advised Ottawa to keep corporate tax rates low ("A Corporate Tax to Grind," April). In promoting the race to the bottom, you are not representing my views, nor are you in line with some of the best thinking on the problem and some of the initiatives underway.

Canada’s tax structure has turned our country into a tax haven, which has had severe negative impacts on our healthcare, education and infrastructure.

When more than half of the TSX 60 corporations paid tax of less than 10% between 2007 and 2011, it is obvious that the system is severely flawed. Canada has a revenue problem and our federal government (and you) must wake up and smell the coffee. Individuals should not have to shoulder the tax burden that rightly belongs to the corporations that are not paying a fair share of their income.

I’d like to see CPA Canada get more in line with the OECD initiative and represent views that are not simply reiterating an old stance that has outlived its unfulfilled promise.

Martina Wood, Mississauga, Ont.

Gabe Hayos, VP taxation, CPA Canada, replies: CPA Canada believes that keeping corporate tax rates low is in the best interest of the Canadian economy. Numerous studies have shown that corporate taxes are not ultimately borne by the corporation. Real people bear the burden. The substantial portion of the tax burden rests with the employees of the corporation through lower wages. Studies have also shown that corporate taxes undermine productivity and growth and that recent tax cuts are paying off in higher investment and more jobs.

In addition to income taxes, corporations pay other taxes such as property taxes, customs duties, sales and consumption taxes and employment taxes. It is critical to consider all these taxes when reflecting a corporation’s total tax contribution. In fact, a recent Total Tax Contribution study from PwC shows that, when all of these taxes are considered, companies in Canada bear a total tax rate of 33.4%, which is more than triple the 10% rate that Martina Wood suggests.

A few good words

Finally, after 54 years as an accountant, I am receiving a professional magazine that is topical, current and above all readable — and one we can be proud of. Workplace is great; Expert Digest and Fraud are brief and to the point. Congratulations and keep it up.

John R. Robertson, Ottawa

I just wanted to say excellent job with the new CPA Magazine. The articles, tone and quality of the content have been outstanding.

I was especially pleased to see mentions of bitcoin and the future of money in the May issue. It shows that you are thinking outside the box and talking about new and exciting issues in the world of accounting.

Ryan N. Lazanis, Montreal

I’m writing to tell you how pleased I am with the content of CPA Magazine. As part of my professional development requirements, I’ve been reading industry magazines for a number of months. CGA Magazine has since printed its last issue and I’ve turned my focus to reading the online issue of CPA Magazine. The articles are well written and the topics are interesting. Instead of reading the magazine as an obligation, I look forward to it.

Julie Lucas, Halifax

I saw some letters complaining about the initial issues of CPA Magazine. I felt I had to let you know that I simply love the magazine. I use some of the articles in class with my students (I am an assistant professor of accounting and finance). The magazine is excellent, the design is jovial and appealing, and the articles deal with timely, relevant and interesting issues in Canada and in the world. Thank you for bringing an international focus to the magazine and the profession. (And I do care about Sophia Loren’s tax battles!) We live in a globalized and interconnected world; our knowledge can’t be limited by our borders. Keep up the awesome job!

Eloisa Perez, Edmonton

One of your best editions (The Money Issue, May) that I have read in a long time.

Adrian Burridge, Qualicum Beach, BC