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Zurich Citizens News, 1974-06-06, Page 12PAGE 12 ZURICH CITIZENS NEWS, THURSDAY, JUNE 6, 1 97 4 The land speculation tax act has undergone 28 hours of deb- ate in the Legislature and pract- ically half the sections of the bill have yet to be considered. The bill has probably been one of the most inept bills that has been introduced into the house and although the Liberal Party of Ontario supports the princip- al taxing those persons who mak( extremely profitable gains at the expense of many Ontario citizens, the members disagree on many of the details of the bill and have proposed many amendments in the hopes of improving the bill. Opposition mambers have argued that there should be an exemption for the small build- ers. At the present time there is nothing in the statute that will allow small builders to cont inue. These are effectively prohibited by and provisions of the bill from going to a dev- eloper and buying three or four or five lots on which to erect houses, because no developer will sell to the small builder without his payment of the 5010 speculation tax. Vern Singer, Liberal for Downsview, argued strongly that there should be an exemption from this tax on the basis that once a subdivision is registered, if a developer takes a piece of raw land and turns it into a subdivision making building lots available then there should be an availability of selling those lots to an individual builder and allowing him to go ahead without the 5 05 speculation tax. Margaret Campbell, Liberal for St. George, tried to instill upon the minister that there should be an exemption from the tax for senior citizens who are in senior citizens accomm- odation and who have rented their home, but fir some reas- on beyond their control have had to sell their homes during ng their residency in the senior citizen accommodation. Other opposition members tried to point out to the Min- ister that the land speculation tax act does not allow either for a widow whose husband died and left her a small estate which she turned into a duplex in order to get a small income from the rent. If this woman decides that there is too much work and worry involved for her and she wants to liquidate her assets she is faced with the spec- ulation tax. In the estimation of the Liberal Party this woman is not a speculator but is bene- fiting from the work done by herself afid her husband and trying to protect herself from inflation. Other arguments of the bill are that the enforcement prov- isions of the act, the limitation period and search or seizure provisions must be changed. Tivi Act allows the Minister's offic- ials to go into somebody's office to gather information and to see his documents and records. Theoretically, at least Jottings by Jack f rom Queens Park for the purposes of this Act, if there is reasonable ground to believe that an offence has taken place under this act as is done in relation to income tax and certain other taxing statutes, they can go in, seize the documents, seize the papers for the purposes of this Act . The provisions of this Act also allow the ministerial officials to take tate seized documents to any other department of the provincial government which is concerned with taxing matters As if that were not enough the statute goes on to provide that the same information, the same documents and the sante records can be turned over to any other department of the Federal Gov- ernment which is concerned will taxing matters. The Act permits these same documents to be turned over to any department of another provincial govern- ment with whom Ontario has a reciprocal agreement. Opp- osition members wonder just what kind of legislation it is which allows the government to come in and investigate a part- icular offence which it must have reasonable grounds to pre- sume is taking place, and then dissipate this information ro all sorts of other agencies of all• sorts of other governments. It really boils down to the fact that it is a Gestapo arrangement which the minister is setting up. The limitation period is six years and in the minds of the official opposition -this is too long a period of tin e, Oppos- ition members feel that if the ministry is doing its job, it should be able to determine whether or not it feels there has been an offence under this Act in a much shorter period of six years. wowi really Another provision of the bill which opposition members dis- ' agree with is that which subjects a farmer to the tax unless he sells his farm to members of his family. Murray Gaunt, Liberal for iluron-Bruce proposed an amendment which would allow a farmer to sell his farm to anyone free of the tax if he has farmed it for a period of 10 or more years. Official plans and land zoning would dictate wheth er this farm was to remain in agricultural production but the argument is, farmers should not be penalized for being the victim of city encroachment upon his land. Opposition members also arg- ue that there should be an exemption from the land spec- ulation tax for people who have been sent out of the country by their employers in order to carry on their business. If they have rented their home and upon returning decide to sell it then they should not be subjected to the speculation tax, Jim Breithaupt, Liberal mem- ber for Kitchener, made several points, one of which, was that the speculation tax should have a time element built into it for an example a depreciating rate of 5% per year. This rate should also be available to the person who owns a commercial building, a sixplex or an extra home which he or she has pur- chased and maintained and has hoped to use as a matter of saving. Mr. Breithaupt also agruged that the various areas of parcels of land that should be exempt are those for which the townships have been giving the minimum severance. In other words if the smallest par- cel of land that one could have severed and upon which one could build a home, is 25 or 28 acres, then that should form the base upon which the tax is levied. Perhaps the greatest uncert- ainty in the bill as it is written at the present time is whether the speculation tax is deduct- ible as a business tax from the Federal income or corporation tax. The Minister of Revenue says "as far as we know the federal government will allow this 5050 tax to be deducted as a cost of doing business." Vern Singer, Liberal for Downs- view, hastened to reply that "as far as we know is a very, very interesting phrase, be- cause I can add to that my comment that as far as I know, BEDARD CONSTRUCTION has the "know-how" when it comes to Building And Remodelling *MODERN HOMES *NEW COTTAGES *BARNS &SHEDS *COMPLETE RENOVATIONS Give us a call for any type of Building Construction. Complete Backhoe Service Available Richard Bedard CONSTRUCTION 236-4679 - ZURICH the federal government is going to make nc such allowance." Where speculators become in- volved taxes could run as high as 815o in the case of a private individual or 80 in the case of a corporation, on the minister's speculation that this 500ro tax was going to be allowed as a cost of doing business. If it is not allowed as a cost of doing and it is added on then the speculator is taxed on the full amount of that profit which amounts to 1125o. This then becomes a confiscatory tax. As indicated at the beginning of this column the Land Specul- ation Tax Bill is so inept that Mr. Singer, Liberal for Downs- view, on behalf of his colleague felt that there was no other re- course than to make a reasoned amendment which appears on the notice paper and which reads as follows: That all the words in the motion for third reading of Bill 25 after the word "That" be struck out and the following substituted therefore;- "The bill be not now read the third time but be referred to the standing administration of just- ice committee so that this com- mittee may determine whether or not the tax imposed by this bill is, in fact, deductible as a business expense under the Federal Taxing Statutes. One of the members of the official opposition who has been in the house for approxim- ately 20 years, commented that he cannot recall when any stat- ute pertaining to such an import• ant matter underwent such long debate. 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