'It's petty': Critics claim taxing employee discounts will impact low-income Maritimers
Published Tuesday, October 10, 2017 9:04PM ADT
The Canada Revenue Agency has signaled it's prepared to start taxing employee discounts – a small benefit millions of Canadians enjoy as part of their jobs.
The federal government says they're simply trying to cut red tape for businesses, but critics say low-income earners will be hurt the most.
"I think it's disgusting,” says Halifax store owner Donna Phelan, “for the fact that these people make minimum wage, and a little perk like that is going to be taxed.”
Millions of Canadians enjoy employee discounts on everything from retail to restaurant meals. Opposition parties are lining up to complain.
"It's petty. It's mean-spirited,” says Conservative Leader Andrew Scheer. “I worked in a restaurant. We got a staff discount if we worked enough hours. We're going to have to pay tax now?”
A spokesperson for the revenue minister confirmed to CTV News Tuesday that her office is reviewing the proposal, which wasn't a legislated tax change and has only appeared in the new tax folio from the Canada Revenue Agency.
“We are not targeting individuals working in retail,” Minister Diane Lebouthillier said in a statement. “Our Government recognizes the important role that the retail sector and those working in it play in our communities and in our economy…
“The Agency issued a guidance document to mainly provide assistance for employers and is committed to further clarifying the wording of the guidance to reflect this.”
The Canada Revenue Agency’s reinterpretation rules say all Canadians have to pay for employee discounts "unless the same discount is available to the public, or a segment of the public, at some point during the year."
The Canadian Taxpayers Federation says it agrees a crackdown on abuses, but only if the discount represents a significant part of a person's income.
“We are getting nickled and dimed with this bureaucratic silliness, and now they're going after those who can least afford it," says Kevin Lacey, director of the federation.
Dry cleaner Joe Doherty says he has seen plenty of changes over the years within the industry, but nothing that directly impacts employees like this. He’s calling on government to scrap the idea.
"They enjoy their job, but the reality is they've got to provide for their family,” Doherty says. “It's much harder to pick on the people who are getting the benefits from their stock options.”
With files from CTV Atlantic’s Bruce Frisko.