Letter to John McCallum, MP and Liberal Finance Critic

Good morning Mr. McCallum

Congratulations on making a specific tax proposal (10%) to address the income trust requirements and consider the real impact on Canadians. As a Canadian, I thank you for that initiative.

We would also observe that the potential strength of your proposal might be lost on Canadians, particularly in the realm of pre-election rhetoric and political campaign advertising.

On the other end of the spectrum, the Liberal proposal can be seen as a moderate approach to “grandfathering” of trusts. And therefore, the proposal may be misunderstood or considered weak due to inherent inconsistencies.  If further issues of income trusts are prohibited, then the policy promises to dampen the potential benefits of the income trust market as described by the Bank of Canada in terms of market efficiencies gained through diversification possible with (and so in principle within) the asset class.

As a non-partisan organization that was not given voice in the public hearings hosted by the Finance Committee, we see there as being potential merit in hosting a public discussion of our own, specifically to consider your new proposal as it appears to be the only one arising in a certain way from the Finance Committee hearings.

If we hosted an event, then would you care to present your proposal directly to analysts and the public during the forum?  Would you be open to moderated public questions in regard to it? If so, then what timing would be most appropriate or workable for you? 

Knowing that you have, no doubt, been approached with feedback on your proposal by financial analysts and others, could you suggest other potential participants to provide thoughtful analysis of your proposal? We welcome suggestions in that regard. The Institute would like to arrange for an unbiased and experienced moderator for the session and involve other panelists or speakers.

We envision the forum as a web based discussion that can involve people from across Canada and can be easily recorded so that it can be offered as a recorded a/v resource from our web site to those unable to attend. We would undertake such an initiative on a cost recovery basis, perhaps charging a nominal fee to participants who attend via the Web. In our work in 2005 to put together a Roundtable to discuss income trusts in line with Ralph Goodales’ public consultation, we found that a web-based event might be more manageable, affordable, welcoming and democratic as a forum for presentation and dialogue than a local event requiring physical facilities.

Please let me know your thoughts and whether such an opportunity to attend would be of interest to you. If, on the other hand, you feel that the Finance Committee hearings and report process will provide further clarity that minimizes the utility of a public forum about your proposal, then I’d appreciate your guidance in that regard.

Thank you for your consideration. I would look forward to hearing from you again at your convenience.

Sincerely,
Leslie Hayman
President, iTrustInstitute

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