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Lethbridge Herald Newspaper Archives

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Lethbridge Herald, The (Newspaper) - February 12, 1971, Lethbridge, Alberta Payroll tax deductions explanation angers MPs Fridey, February 12, 1971 TH8 LtTHBKIOGE HEtAlO 1J OTTAWA (CP) CBC Presi cient George Davidson admitted today that it was "arguable" that the CBC should have started making payroll tax de- ductions for 20 employees in the U.S. when it became clear in 1967 they were subject to U.S. taxation. The employees went five years, from 1964 to 1969, without paving income taxes to either Canada or the United States. In 1969, Hie CBC itself was as- sessed in U.S. taxes for "failing" to comply with U.S. law by not making the em- ployee deductions for the period from April 1, 1966, to Dec. 31, 1968. Mr. Davidson said the corpo- ration rather than the employ- ees was liable because it had failed to make the deductions. IDs explanation of the affair left members of the Commons public accounts committee wri- thing with anger and frustra- tion. The last exclamation was a shouted "dog-gone it" from Tom Lefebvre COST TAXPAYERS Committee Chairman Alfred D. Hales said questioning will continue at the next meeting Tuesday. It arises from a paragraph in Auditor- General Maxwell Henderson's 1969 report saying that the CBC's "failure to comply" with U.S. tax law cost the Canadian taxpayer Mr. Davidson said the affaii began in 1958, when Parliament changed the status of CBC em- ployees from that of civil serv- ants to Crown corporation em- ployees. This meant that those working in the U.S. were liable to U.S. rather than Canadian income taxes. But the U.S. revenue de- partment didn't catch up to this until 1961. In January, 1962, the U.S. in- dicated that the CBC employees would be subect to U.S. taxes beginning June 30, 1961. How- ever, Mr. Davidson said, it wasn't until 1967 that the CBC was told this. Meanwhile, the question of axability of the employees un- der Canadian law arose. In 1964, the CBC stopped making deductions for Canadian income .axes but it didn't start making them for U.S. taxes. Questions and answers about this period indicate that Canada bringing to eight years the pe- hart rut riaht fivoc- ;n had DO right to collect taxes from the employees for the 1961-64 period and that they might be able to get a riod in which they paid no in- come taxes to anyone. Mr. Davidson argued that the CBC "had no legal right" to Government subsidization of meat plants supported CALGARY (CP) Govern- ment subsidization of meat pro- cessing plants should not be turned down by the meat pack- ing industry, says Jim Wilfley of Lakeside Feeders at Brooks. Mr. Wilfley, who is construct- ing a million subs i d i z e d beef and feeding processing op- eration 70 miles east of Cal- gary, was commenting on oppo- sition to subsidization that was raised Tuesday by the presi- dent of the Meat Packers Coun- cil of Canada. Council President A. J. E. Child of Calgary told the asso- ciation's annual meeting that packers processed an average of head of cattle a week last year while plant capacity was head. Mr. Wilfley said it is normal for the established industry to object to competition but noted some processing plants in the province 'are obsolete and might soon need replacement. The location of the Lakeside plant, which will begin opera- tions in about a year with a capacity of head a week, also has some economic advan- tages. As for criticism that no eco- nomic studies had been done before the government gas as- sistance, Mr. Wilfley said his company was adding million to the subsidy and did not plan on investing in an operation that would not make a profit. make deductions in the peritx after 1964. Another point was that CBC employees in the U.S. were get- ting special allowances equiva- lent to those for diplomats. The allowances aren't taxable for Canadian civil servants working in the U.S. but are for Canadian Crown corporation employees. To keep the allowances equiv- alent to those for external af- fairs employees while deducting U.S. income taxes for them would have cost more than the the CBC finally had to pay out, Mr. Davidson main- tained. However, the argument of equivalency of allowances evi- dently didn't sit well with the MPs. "Something should be said Jack Bigg CBC lawyers had told him here is no way under the law hat the money can be re- covered from the employees. The CBC was liable because it didn't make the deductions as the law required. The hardest blast came from Joyd R. Crouse who said that "the ac- ion taken by CBC officials can- not be accepted by this commii- tee and by the Canadian peo- ple." NAME TWO EMPLOYEES Mr. Crouse asked why the j CBC cannot collect from such j employees as Knowlton Nas now a CBC executive in T ronto, and Romeo Leblan Prime Minister Trudeau's pre. secretary and a CBC employe in the U.S. during the perio under dispute. When the government ove paid a war veteran's allowam to a veteran who began drawii. an old age pension, the mone was collected "to the penny." Mr. Davidson said agair th CBC has no right to collect froi the employees. BEAT INFLATION DO ALL YOUR FOOD SHOPPING AT- Iclentify victim of accident EDMONTON (CP) Alid Woolford, 44, of Edmonton ha been identified as the victim o a traffic accident. Police said Mrs. Woolfor who died in hospital shortl after the accident on the city louthside, was the driver he vehicle involved. There never was a better time to trade than now. The boys at are anxious to deal... they're putting you FIRST in a BIG way. Get a better car at a better deal now at Prices effective until closing Saturday, February 13th. TABLE RITE YOUNG PORK ROAST Picnic Style, Hock On TABLE RITE RED BRAND Canada choice, blade Roast b8neremoved lb. 75P BURNS SLICED Cold Meats Mb. pkg. OCHlit 1961 CHEVROUT STATION WAOON v< OW4JA itMDODOt MOOR HAKOTOf mow, radio MOVf I ORI1I VAUXHAU VIVA iratii. FAST APPRAISALS v MOTORS INSURANCE CORPORATION ICING SUGAR 2-lb. pkg. 48-fl. 14-fl. oz. tins 1.19 -fl. or. tin E NABOB PURE STRAWBERRY Jam LIBBY DEEP RROWN Beans Pork ROBIN HOOD Floor YORK CHOICE Strawberries 14-fl. oz. tinsO foi or SNO CAP FRENCH FRIES 2-lfa. pkg. ROGERS GOLDEN Syrup BALLET ASST. COLORS Tissue 5-lb. fin 85' 4 roll pack TOP TRADE-IN ALLOWANCES CONVENIENT GMAC TERMS 10.000 General Mowrs MAIN GARAGE AND SHOWROOM 2nd Avenue and 8th Street S. Phone 327-3147 OK SUPERMARKET CAR IOT 2nd Avenue and 9th Street S. Phone 327-3148 THE FINEST SERVICE AFTER THE SALE FAST DELIVERIES 5 MIC INSURANCE MEXICAN ORANGES Sweet and Juicy AnniW Canada Foncy HPPleS Spartan Ib. 10' WE RESERVE THE RIGHT TO LIMIT QUANTITIES ;