One Comment About Taxation – The Importance of Tax Reform And Improving the Development of Tax Policy

One of the things I enjoy is hanging out with tax geeks like me who have a similar passion to see Canada’s tax system improved. 

 

Last week, I attended the Canadian Tax Foundation’s Conference in Toronto on tax policy entitled, Tax Policy Symposium.  It was attended by roughly 100 in-person (with more attending virtually) tax practitioners, academics and government bureaucrats who work in the tax arena.

 

While there were no break-through moments or new ideas presented, there were good reminders that Canada has much room to do better in the development of tax policy.  And there certainly is an interest in tax reform but lots of debate on how that should be carried out.

 

As usual, some of the predictable warnings showed up: “Be careful what you wish for on tax reform…it might just be ways to raise new tax revenues” and “Tax practitioners shouldn’t be involved in tax reform or the development of tax policy since they are inherently biased”.

 

Let’s just say that I don’t buy the gloomy warning about being careful what you wish for.  If a genuine tax reform process was entered into with good objectives (improve fairness, simplify, remove political clutter from the statutes, big-bang corporate and personal reform) and quality people then I think cooler heads would prevail and ultimately a revised and better system would result for Canada.

 

I obviously disagree with the sentiment that tax practitioners should not be involved in the development of tax policy.  Despite some who think tax practitioners will always show their bias to the clients they serve, believe it or not most tax practitioners want to share their front-line experience and offer suggestions for a better Canada.

 

Obvious comments were also expressed about how it would be challenging for any minority government to put tax reform as a priority.  I don’t disagree with that.

 

To remind readers, the last time Canada had comprehensive tax review was from The Royal Commission on Taxation convened by Prime Minister Diefenbaker in 1962.  After four long years, it finally released its voluminous report complete with many recommendations in 1966. The new government of the day (since Diefenbaker’s Conservatives were defeated in the general election of 1963) did not agree with many of the recommendations. After much debate, some of the recommendations – including altered ones – were brought into law in 1972.  Many of the recommendations were ignored.

 

Although I’m a purist and would relish the opportunity for Canada to do another Royal Commission on Taxation, it is debatable whether or not such a process is the best way to institute tax reform. In today’s political environment, four years of study is unrealistic. Any sort of tax reform would need to be much more politically expedient given the fact that politics and taxation policy are like good food and red wine – they are inextricably linked.

 

At a minimum though, even if comprehensive tax reform is not in the immediate future, I believe there are significant improvements that could be made to how new taxation policy is developed. There was good discussions at the Symposium about how tax practitioners and other stakeholders could be brought into the development much earlier rather than when the policy is almost fully baked. I agree.

 

While the government has a distinct advantage in developing taxation policy – since they have immediate access to data that most others do not – many bureaucrats do not have front-line experience or if they do it has been years since they did. Taking advantage of practitioner experience in the development of taxation policy seems like an obvious good strategy to me. But, as mentioned above, perhaps I’m biased.

 

There were also good reminders about how other countries – like the U.K., Australia and New Zealand – develop taxation policy. The short story is that those three countries are much more inclusive with stakeholders when developing policy.

 

There were conversations about the possibility of developing a new independent tax policy body that would, in some way, report to government. The new body would comprise various stakeholders, not just government bureaucrats. Again, this is not a new idea and many, including me, have advocated for such a body over the years. Obviously, the devil would be in the details about how the body would be comprised, who it would report to, what “teeth” it would have, etc. Conceptually, though, I like the idea since it might have the potential to develop much better taxation policy from the start and work with the government of the day in the implementation of such policy introduction.

 

Overall, it is disappointing to me how little interest there is from the average Canadian in trying to appreciate the importance of good taxation policy. I get it – there are far more exciting things to follow like Taylor Swift’s tour schedule – but tax policy affects Canadians far more than any celebrity headline. When one understands how taxation impacts one’s lives in a material way, the engagement should be higher.

 

Taxation policy may never be exciting and rarely a voting issue, but it is the foundation of economic growth, fairness, and trust in government. Canadians deserve a system that respects their contributions – not one built for political convenience. Tax reform – or changing how taxation policy is developed – won’t be easy, but neither was building a country.

 

As John Ruffolo, one of Canada’s thought leaders, bluntly put it, “Tax policy does not stimulate prosperity — it only gets in the way.” He’s right. Especially the mess that our current tax system is. If bold, comprehensive reform is politically unrealistic today, then at least let’s demand a far more inclusive process in the development of new policy. Bring practitioners, academics, and other stakeholders into the room early – before policy is baked – not after. Other countries have learned that stakeholder engagement doesn’t compromise quality – it can strengthen it. There’s no reason Canada can’t do the same.

 

Good tax policy is required for good economic policy. And right now, Canada has neither.

 

One Comment About Leadership – Leaders, Are You Aware of the “Ladder of Connection”?

 

One of my favorite podcasts to listen to is The Art of Manliness. The topics are wide ranging and always interesting. The September 30, 2025 podcast was entitled “Why You Need the Good Stress of Socializing” and featured a conversation with Jeffrey Hall, a PhD academic from Kansas that has been studying the importance of relationships on overall health. It was a fascinating conversation and I’d encourage you to have a listen.

 

One of things that Dr. Hall discussed was what he refers to as the “ladder of connection” with the lowest form of connection being the lowest impact and the highest being the best.  His “ladder of connection” is as follows:

 

1. Passively consuming on social media (just viewing)
2. Group chats
3. One-to-one texting
4. Phone or video calls
5. Face-to-face conversation

 

The above framing was discussed from the context of building a “social biome” and moving from solitude to stronger friendships.

 

The takeaway: climb the ladder when you can – text if that’s all you’ve got today but aim for calls or in-person time to get the biggest connection boost.

 

I agree. For those that know me, I’m not a big fan of most forms of social media – notwithstanding I do use it to spread news and obtain information. And I despise video calls when in-person is an option. Why? Well, now I have the framing of the “ladder of connection” to help me explain why. I value forming real relationships. Not “virtual” ones.

 

Don’t ask me to have a “virtual coffee” when an in-person coffee is an option. I’ll always decline in favor of building other relationships higher up the ladder.

 

Leaders, are you intentional in how you form connections? Are you purposeful in climbing the ladder of connection?

 

One Comment About Economics – Canada’s Federal Budgets Will Now Be Presented in the Fall – But Why?

 

On October 6, 2025, the Department of Finance released a document that disclosed how the separation of the budget into “capital and operating” will be done. Specifically, it laid out the parameters of what spending will be considered capital. Suffice it to say the proposed definition of capital is absurdly broad which will lead to significant obfuscation of how budgets will be presented. I laid out my brief comments on my LinkedIn profile. I’ll have more to say on this simplistic and misleading approach next week.

 

The announcement also stated the following:

 

The government is also modernizing its budget cycle to better align with the needs of builders, businesses, investors, provinces, territories, and municipalities. Starting with Budget 2025, the federal budget will be tabled in the fall, with an economic and fiscal update released in the spring. This change will provide the certainty and predictability needed to plan ahead and ensure projects can begin as soon as construction season starts – helping every level of government make smarter, faster investment decisions.

 

As I stated on my LinkedIn comments about this, I’m of mixed mind with respect to moving from a spring budget to a fall budget. Not sure why this is necessary after over 150 years of having a spring budget norm. I’m not buying the sales job contained in the release. As a reminder, the government’s fiscal year starts on April 1 and ends on March 31 yearly.

 

Accordingly, having a spring budget ahead of the upcoming fiscal year makes sense. On the other hand, the budget is usually presented days before the start of the new fiscal year – or shortly after commencement – so having a budget done well in advance might make some sense. But in the fall?? That seems too early to me especially given what might happen months before the commencement of the new year.

 

Having said that, I did write in a recent newsletter that Canada should adopt fixed budget dates to provide better certainty. Unfortunately, this move is not that since “the fall” can mean anytime from roughly September 21 – December 21 annually.

 

My conclusion: a fall budget is premature, ill-defined, and unnecessary. After 150 years, the spring tradition still makes fiscal and practical sense.

Your thoughts?

 

Bonus Comment – Quote Attributed to Peter  Drucker – The Father of Modern Management

 

“The most important thing in communication is hearing what isn’t said.”

 

Absolutely agree….which underscores the importance of in-person relationships. Leaders, be intentional about climbing that ladder of connection.

 

Hope you enjoyed this edition of 1-1-1. If you’re not already part of the In the Mood Network, now’s the time. Please sign-up today.  Whether it’s through consulting, coaching, speaking, or writing, my work is about planting acorns: deliberate, principled actions that challenge the status quo and grow into something far bigger. The goal? Bold reform. Stronger foundations. And a country that values hard work and common sense.