This letter was originally sent by Ron McNeil, CEO and co-founder of LMS Reinforcing Steel Group, to federal Finance Minister Bill Morneau and was submitted to the Daily Commercial News for publication.
Attention: Finance Minister Bill Morneau
LMS is a mid-sized private corporation with operations in British Columbia, Alberta, Saskatchewan and throughout the state of California.
We employ approximately 650 employees in Canada and another 350 employees in the United States. We are currently recognized with Deloitte’s "Gold Standard" among Canada’s Best Managed Companies.
Since starting the company in 1987 with my partner, LMS has always been aggressively growth-oriented. We started as a labour-only company, placing rebar on projects in Vancouver. We then risked everything we had to finance the purchase of a fabrication yard in Surrey, B.C. in 1998.
Ten years ago we took another significant risk, expanding our operations into the Prairies. Most recently, our growth has led us into the United States, where both the opportunities and risks are immense.
In short, our success has only come by continually risking everything we had built, again and again, to achieve the next level of growth. We have repeatedly put on the line our own futures, and that of our families, to grow this business.
It is for this reason that I take great exception to both the content and political tone of the proposed taxation changes.
Concerning the content of the proposed changes, the changes will without question have a significant chilling effect on our ability to continue to grow and create jobs in Canada. The changes are not about simply closing "loopholes" that impact our business on the margins. The proposals are a sudden and fundamental rewriting of the rules of taxation of private corporations.
The proposals remove long established practices that recognize the special circumstances of small and medium-sized business owners and they seek to, in one dramatic set of changes, put us in the same position as employees.
Concerning the political tone of the proposed changes, there is an undeniable implication that business owners such as myself have not been paying their "fair share" of taxes and using "loopholes" to avoid our share of an appropriate tax burden.
This tone creates an atmosphere of hostility to business and entrepreneurship in this country that is in my opinion unjustified. The tone seems deliberately aimed to foster an "us versus them" mentality between business owners and employees, something that is not warranted, or in keeping with Canadian values.
There is no question that our future business expansion decisions will in part be affected by both the content of these rules and the hostility to business generated by the political wedge the rules have created. These proposals are not in keeping with the historically moderate nature of the Canadian Liberal Party and I strongly advise they be abandoned.
Thank you for considering my submission.
LMS Reinforcing Steel Group
CEO and co-founder