Federal budget’s simpler plan to tax passive income likely to calm small business outcry
For most of the last year, there has been an outcry from small businesses regarding the proposed tax changes. As a result, Budget 2018 has taken a scaled-back approach for taxing passive investment income. The new approach is meant to relive complex accounting for small businesses, but also result in reduced money for the federal government. Starting in the tax year after 2018, the new rules will mean that multi-million dollar private corporations will no longer qualify for the federal small business tax rate of 9 percent and instead be taxed at 15 percent.