Click here to download a copy of the letter below sent by Registered Mail. It was also mailed to the 33 other Coalition members.
Coalition for Small Business Tax Fairness
c/o The Canadian Federation of Independent Business
Dan Kelly, President and CEO
401-4141 Yonge Street
Toronto, ON, M2P2A6
Protesting the proposed ‘Income’ Tax Act (“ITA”) so-called tax fairness changes is commendable. However, protests will not stop the Government’s proposal (“Proposal”) from becoming law. This is because the Coalition lacks a bargaining chip. However, we have one. Tax fairness is already in the ITA for everyone. It depends on the income type.
The Coalition for Small Business Tax Fairness lacks a bargaining chip
Canada’s Department of Finance (“DoF”), who authors the ITA, hides this tax fairness. If they did not hide it, taxpayers will realize they have a choice as to the income type they earn, and that the Proposal only applies to a certain income type. That is why the DoF obfuscates the ITA so badly that even tax guru Vern Krishna CM, QC, LSM, FCPA says it is “incomprehensible”. Lyman MacInnis, past President of the Institute of Chartered Accountants of Ontario, publicly complained that the ITA is “incomprehensible”, is “an unmitigated mess”, and does not define ‘income’. The DoF keeps everyone, including tax professionals, in the dark.
The Department of Finance keeps everyone, including tax professionals, in the dark
“Apu’s Theory”, our research on how ‘income’ tax already has tax fairness, concludes the amount of ‘income’ tax due depends on self assessing the income type you earn. That is why CRA says ‘income’ tax is based on self assessment. If individuals do not choose, then ‘income’ tax is payable on net income (after any “income sprinkling”, etc). Silence means consent in law. Silence also means the income type is deemed  as Canada’s “public money” and not as your private property. This could be why CRA treats taxpayers so harshly. After all, taxpayers are deemed as handling someone else’s money – Her Majesty’s money!
If taxpayers self assess their ‘income’ staying as their private property, then the ITA deems the taxable income amount as being zero. (A July 2017 ITA amendment means the ITA now recognizes private property). This is because stealing private property is a Criminal Code offence. However, since the DoF does not like lower tax revenue, this could be why the ITA does not define ‘income’.
Self assessment includes on what income type
Taxpayers cannot self assess what income type they make if they (and their tax professionals) do not understand how the ITA actually works. Their silence allows the Government continuing collecting taxes on net income. Therefore, their Proposal is just avoiding the real issue – that taxpayers can self assess the income type they earn.
The DoF has obfuscated the self assessment tax fairness choices for 100 years. Arming Coalition members with Apu’s Theory means finally exposing it. Self assessing their pay as their private property means the Government then receives less taxes. This is the only way to force them into spending less. It also forces them into spending tax dollars more efficiently. This is tax fairness for everyone!
Less taxes forces the Government into spending tax dollars more efficiently
In conclusion, the Coalition is in a unique position to expose the hidden tax fairness already in the ITA. This is because it takes large numbers. If one individual brings anything up, the Government just stomps on him or her. (Just ask former Hamilton tax lawyer Marc Holterman). However, if the 1.1 million Coalition members stand together, then the Government will have to admit the ITA already has tax fairness for everyone. This is because they don’t have the resources to stomp on 1.1 million people.
Our website is www.CanadaIncomeTaxIsLegal.is. Our research also shows why income tax is both legal and constitutional. The home page has a 9-minute overview. Apu’s Theory is archived at the Social Sciences Research Network at: http://bit.ly/2jeaZc7.
Apu Nahasapeemapetilon, Ph.D. (Caltech)
cc Coalition members listed on the next two pages