Skip to main content

Politics Senate Speaker Furey strikes down attempt to rewrite tax code

Speaker of the Senate George Furey is pictured in the Senate chamber.

CHRIS WATTIE/REUTERS

A surprise Senate push to rewrite the tax code has been struck down.

Senate Speaker George Furey ruled Tuesday that amendments made to a government money bill amount to a tax increase, which is beyond the powers of the Senate.

The Conservative-dominated national finance committee in the Senate infuriated the government representatives in the Senate last week by making major amendments to a budget-related bill.

Story continues below advertisement

Bill C-2 was the first piece of legislation introduced by Prime Minister Justin Trudeau's government. It outlines personal income-tax changes that were put in place as of Jan. 1, 2016, that lower taxes on middle-income Canadians while raising taxes on incomes exceeding $200,000.

Conservative Senator Larry Smith had introduced an amendment that would have delivered a larger tax break on income earned between $45,282 and $52,999 but would have reduced the tax break at higher levels.

The Parliamentary Budget Officer had previously noted that, contrary to campaign promises made by the Liberals, the government's package of income tax breaks and increases are not revenue-neutral and will in fact create a permanent annual shortfall of $1.7-billion. Mr. Smith's amendment aimed to address that issue, but such a change effectively meant the amendment would raise taxes for some people this year.

Mr. Smith had argued the change was not a tax increase when compared with 2015 tax levels, but the Senate Speaker was not convinced. Mr. Furey, who was appointed as a Liberal in 1999 but now describes himself as a "non-affiliated" senator, ruled that the Senate can amend bills to reduce taxes and spending but cannot impose increases.

"Whether an amendment is, over all, revenue-neutral, is not relevant. The question is whether it will increase taxes or not and the Senate cannot increase the amount," said Mr. Furey in his ruling.

As a result, the Speaker said the bill will be treated as if it came from the Senate committee unamended. The bill will be now debated at third reading in the Senate. If passed without amendment, it will receive Royal Assent and become law.

The Conservatives in the Senate continue to hold a majority on Senate committees even though a recent wave of new Senate appointments has diluted their power in the full 105-seat Senate. Once all the new Senators are sworn in, there will be 44 "non-affiliated" Senators, 41 Conservatives and 21 Liberals.

At some point soon, the Senate is expected to restructure the Senate committees so that they reflect the same balance of power as the Senate.

Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Discussion loading ...

Cannabis pro newsletter