NDP Wants to Make it Easier for Family Businesses to be Passed on to Future Generations
May 17th, 2016 - 11:58am
FOR IMMEDIATE RELEASE
May 17, 2016
NDP WANTS TO MAKE IT EASIER FOR FAMILY BUSINESSES TO BE PASSED ON TO FUTURE GENERATIONS
OTTAWA – Guy Caron, NDP Finance critic, along with his colleagues, Ruth Ellen Brosseau (Agriculture and Agri-Food), Gord Johns (Small Business) and Fin Donnelly (Fisheries and Oceans and Coast Guard) held a press conference to present measures to make it easier for family businesses to be passed on to future generations.
"Local business owners are becoming more and more frustrated. It is more beneficial for them to sell to a complete stranger than to a member of their own family,” said Guy Caron. "The bill I will be introducing shortly would put an end to this unfair treatment for our small business owners, family farms, and fishing companies.”
Currently, when a person sells their business to a family member, the difference between the sale price and the original price at time of purchase is considered as a dividend. If that same business is sold to a non-family member, it is considered as a capital gain. This disadvantages family transfers as there is no lifetime exemption and they pay more in taxes.
Dan Kelly, president of the Canadian Federation of Independent Business, commended Mr. Caron and the NDP for this important initiative to help small businesses.
"Our small business members report that current tax rules often discourage them from passing on their firm to their children and encourage selling to a stranger or larger enterprise,” said Kelly. "Mr. Caron's bill addresses the problem and helps small business owners ensure their firms remain locally owned – protecting and creating local jobs”.
While 76% of small business owners plan to retire in the next ten years, only half of them have a succession plan. This bill would allow for intergenerational business transfers.
The bill will be debate in the House of Commons this fall. Over the course of the next few months, NDP MPs will be discussing this issue with small business owners, farmers and the fish harvesters.
– 30 –
For more information, please contact:
NDP Media Centre: 613-222-2351 or firstname.lastname@example.org