Tom Henihan
Considering the generous compensation many high earning individuals receive and the options they enjoy to shelter, divert and sprinkle those financial dividends to avoid paying taxes it seems mean spirited when the Canadian Revenue Agency (CRA) proposes taxing employee discounts, one of the few benefits that low earners receive.
This vindictive form of taxation denies those who have difficulty paying their rent and making ends meet any concession from their employer or their government. The employee discount is often the small margin that mitigates the futility of working for less than a liveable wage.
A document posted on the CRA website deems an employee discount as a taxable benefit and when an employee receives a discount on merchandise, the value of the discount should be included in the employee’s income at tax time.
Taking the sublime to the ridiculous, this tax would also apply to people working in the fast food industry who receive a discount on their meals.
Typically, the regimen of the fast food industry is irregular hours and low pay where a discount on an employee’s meals is a small perquisite in an otherwise abject work environment.
Speaking on CBC’s Power and Politics, Liberal MP Marco Mendicino said, “If you’ve got an employee discount that is not available to the public at any point in time, then it will be categorized as a taxable benefit.” He also insisted that this matter was about “clarifying” the law.
Another matter that needs clarification is that if a discount is available to the public then it ceases to be an employee discount as it is not necessary to work for the establishment to receive that concession.
This renders the concept of employee discounts redundant.
The Liberal Government likes to sell itself as compassionate and empathetic to all Canadians across the economic and social spectrum. However, they talk incessantly about the rich and middle class as if only these two demographics are worthy of consideration except, apparently, when it comes to draconian taxes.
A great many Canadians don’t belong to the wealthy or the middleclass though there is no clear outline as to what economic or educational status constitutes middleclass.
However, the working poor are easy to identify by their place of employment and the jobs they do. The retail and the hospitality sectors are two principal players in the minimum wage sphere, where the employee discount often accounts as the only factor that tips the balance between sustainable and unsustainable circumstances.
The matter of taxing employee discounts is not about the law it is about social justice and decency and mercifully political and social opposition to this proposed tax measure has proven that the Liberal Party is not as representative as it like to purport.
Predictably, when the Liberal Government realized how unpopular this tax initiative is it ordered the CRA to cease and desist. The Government also claimed that the agency acted alone without government’s approval. Obviously this last claim is implausible unless Marco Mendicino can clarify his spiel about “clarifying” the law.
When one considers behemoths such as McDonalds, a corporation that averages 25 billion US dollars in sales annually and the absurd attempt to claw back tax on a minimum wage earners discounted Happy Meal, one might suggest that the government find this revenue at the top of ladder rather than at the bottom. Have a nice day indeed.