Morneau plans to impose a "reasonableness" test so this does not punish legitimate family businesses. That test will determine just how much work a family member actually does at a business, and if they can really lay claim to profits. Approximately 50,000 Canadian families will be affected by this change, Finance Canada estimates.
More endless twiddling of knobs by the federal government of the day; when will a new generation of computer scientists take on the job of modernizing the way taxes are calculated and collected in this country?
As I have been droning on, there is an existing model, the Automated Payment Transaction Tax (APT) that eliminates the institution of tax collectors and all the parasitic businesses feeding off it.
And as I have demonstrated in March 2017, the model, based on incomplete Canadian data, can get the tax rate down to 4.25% per financial transaction. Feige's original model for the U.S. based on late 1990's early 2000's data produced an astonishing transaction rate of less than 0.5% per transaction.
That's right, less than a half of a percent per financial transaction would produce revenue neutrality.