One Taxation Comment – Big Release of Draft Tax Legislation on August 4, 2023

Ever since I’ve been a tax specialist – almost 30 years now – there has been almost a tradition that the Canadian Department of Finance releases massive amounts of draft tax legislation on Friday afternoon at the beginning of a long weekend.  True to form, the Department released a massive document dump on the afternoon of August 4, 2023:  the beginning of a long weekend in most of Canada.  The documents can be accessed here.

Ignoring the never-ending “green” legislation that this government releases, the drafts include:

• Budget 2023 draft legislation for
  • Employee Ownership Trusts;
  • Amendments to Registered Compensation Arrangements;
  • Additional amendments for the Intergenerational Business Transfer Framework; and
  • The Alternative Minimum Tax amendments;

• Further amendments to the general anti-avoidance rule;
• Introduction of the BEPS-influenced Global Minimum Tax;
• Amendments to the previously released interest deduction restrictions (known in the tax community as “excessive interest and financing expenses limitations” – “EIFEL”); and
• Other technical income and GST amendments.

The overall package is quite voluminous and will take a while for the tax community to absorb and comment on.  I’ll be sure to comment on various aspects of the release once more fully absorbed. In the meantime, if you’re a tax practitioner, read the material…it’s important and interesting.

 

One Comment About Leadership – The Three Golden Rules

Twenty-five years ago, in 1998, I joined an entrepreneurial coaching program – The Strategic Coach – founded by Dan Sullivan and Babs Smith.  It changed my life for the better.  When I started my practice in 1994, I naively thought that my Bachelor of Management degree combined with my CA would give me the entrepreneurial skillset to help me navigate the complex world of being an entrepreneur.  Nope.  Not even close.  When introduced to The Strategic Coach, I found like-minded peers seeking guidance and direction.  I discovered the power of peer-to-peer learning.

One of the tools that was taught to me in one of my first classes was “The Three Golden Rules of Life,” which is:

1. Do what you say;
2. Show up. On time.
3. Say “please” and “thank you.”

I started practicing this simple set of rules from day one and have been diligent about it ever since.  When you truly absorb the above, it comes down to a simple word and principle:  Respect.

Combine the above three golden rules with the principles espoused in Dale Carnegie’s classic book “How to Win Friends and Influence People” and leaders have a recipe for great success.

Leaders, I challenge you to live the three golden rules, and if you have not read Dale Carnegie’s book, I also challenge you to read it.

As a closing comment, I recently became a Chair / Coach for a very successful peer-to-peer learning group – MacKay CEO Forums – and I launched my first group last month.  I currently have openings for qualified candidates, and I’m accepting applications to fill my first group.  Reach out to me by email if you’d like to learn more.

 

One Comment About Economics – Modern Monetary Theory

 During the COVID days – especially during 2020 and 2021 – it was a rare day that an article in the press espousing the greatness of the Modern Monetary Theory (“MMT”) of economics didn’t appear.  It was almost non-stop.  But where are the articles now?  Almost non-existent.  Why?  Because MMT, in my opinion, is bunk.

So what is MMT?  Some quotes from a webpage that puts MMT in fairly plain English – accessed here – are as follows:

The central idea of Modern Monetary Theory is that governments with a fiat currency system under their control can and should print (or create with a few keystrokes in today’s digital age) as much money as they need to spend because they cannot go broke or be insolvent unless a political decision to do so is taken…MMT theorists explain that debt is simply money the government put into the economy and didn’t tax back. They also argue that comparing a government’s budget to that of an average household is a mistake.

While supporters of Modern Monetary Theory acknowledge that inflation is theoretically a possible outcome from such spending, they say it is highly unlikely and can be fought with policy decisions in the future if required. They often cite the example of Japan, which has much higher public debt than the U.S.

Well, I hope the worldwide experience of governments pumping extraordinary amounts of money into their economic systems, which has resulted in high inflation – that governments are still struggling with today –  is an example of how MMT is seriously flawed.  And why we’re not seeing numerous articles espousing the so-called wonders of MMT.

 

Bonus Comment – Quote From Dale Carnegie About How We Have Contact With the World:

“There are four ways, and only four ways, in which we have contact with the world.  We are evaluated and classified by these four contacts: what we do, how we look, what we say and how we say it.”

Yep – totally agree.  This is similar to the Three Golden Rules (but obviously different).

And, with that, Leaders go live the Three Golden Rules and appreciate the four ways you have contact with the world.

 

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