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Federal Finance Minister Jim Flaherty took a swipe Sunday at opposition parties and critics trying to secure up to a decade of exemption for income trusts from a new tax, saying this effort is merely a ruse to effectively negate the measure.

Existing income trusts are spared the new 2007 trust levy until 2011, but the Bloc Québécois and the Liberals are talking about trying to amend the tax legislation so the moratorium lasts up to 10 years instead of four.

Special parliamentary hearings, forced by the Liberals and Bloc, are starting later this month to grill the Tories and experts on controversial provisions of the tax.

Income trusts hope the Parliamentary probe will build momentum for the Bloc and Liberals to jointly amend the income trust tax when it reaches the Commons finance committee, where they have an effective majority of votes.

But Mr. Flaherty, speaking to CTV's Question Period Sunday, dismissed critics who call for a decade-long exemption.

“Those who want to extend the time period to 10 years from four years really are being too cute by half,” Mr. Flaherty said.

“What they're really saying is, ‘We disagree with the decision and we don't want to come out and say we favour unfairness in taxation, so we'll try to do this guile thing of four years to 10 years,' ” he said.

“That would really kill the income trust decision.”

He didn't elaborate, but a 10-year exemption would spare existing trusts from the tax until 2017.

Separately, the Tories haven't decided yet what strategy they will use to pilot the income trust tax legislation through Parliament.

Although they have enough support from the NDP and Bloc to pass the tax bill, the Bloc and the Liberals want to rewrite it in committee.

Mr. Flaherty said he's not decided yet whether the Tories will introduce separate legislation on the trust tax or fold it into the omnibus money bill that will enact the federal budget, expected March 20.

A standalone trust tax bill could be easier for the Bloc and Liberals to amend then budget legislation. Mr. Flaherty said Sunday his “inclination” is toward a separate bill.

The Conservatives broke an election promise last Halloween when they announced a tax on trusts to stem a growing revenue bleed, and curb the growth of a vehicle they said threatened Canada's economy.

The levy was designed to effectively end any tax advantages for investors in trusts over corporations.

Income trusts pay little or no corporate tax, instead shovelling out the bulk of earnings to investors, who are taxed individually. Mr. Flaherty said last Oct. 31 that Ottawa never recouped all the tax these businesses would have paid had they been structured as corporations instead of trusts.

He justified the new levy by saying that annual tax leakage was already $500-million and would have risen to $800-million had BCE Inc. and Telus Corp. converted to trusts.

The Opposition Liberals are expecting to grill Mr. Flaherty on this when he appears before the special parliamentary hearings.

Income trusts have produced experts to repudiate Ottawa's tax leakage estimates, but Finance has so far rebuffed requests to divulge exactly how it derived those figures.

The department has also never proven assertions that trusts discourage reinvestment or are bad for productivity growth.

Mr. Flaherty said the Tories will not waver on the trust tax or its provisions.

“We have to look at the longer term and not at just politics in the short term like the Liberal Party, quite frankly, is doing with this income trust issue,” he said.

“They haven't even taken a position on it, quite frankly, and we have, and we've been clear about it and we will maintain that position.”