Canada Revenue Agency tax rule will impact some Manitoulin campgrounds

Rita Gordon of Gordon’s Eco Resort holds up the petition from Cheryl Gallant, MP for Renfrew-Nipissing-Pembroke, against the CRA tax rule which Ms. Gordon has been encouraging guests to sign.

ONTARIO—The Canada Revenue Agency (CRA) has decided that some privately-owned campgrounds are too small to qualify for the small business tax deduction—a decision that could force some campgrounds on Manitoulin to close.

“I know of at least five campgrounds that will be affected by this (the CRA) decision,” said Sam Nardi, of Sam Nardi Business and Tax Consulting, in Little Current. “The tax rate for a corporation (which qualifies for the small business tax deduction) is 15 percent, but if a business doesn’t qualify, they will have to have the full corporate rate which is 35-36 percent—that’s more than double.”

Rita Gordon of Gordon’s Eco Resort said she hasn’t received a letter from the CRA, but that she knows of other campground/resort owners who have.

“This is a problem for all of us on Manitoulin,” said Ms. Gordon. “To qualify for the small business tax deduction you have to have at least five employees employed year round. On Manitoulin and in the north, we are mostly seasonal.”

Ms. Gordon said that she has signed an online petition against the CRA tax rule and is encouraging her resort guests to sign a petition from Cheryl Gallant, MP for Renfrew-Nipissing-Pembroke.

“We quickly ran out of pages and had to request more we had so many signatures,” said Ms. Gordon. “I sent out an email lobbying for the various Island townships and First Nations to pass a resolution stating that they weren’t in favour of the tax rule and to the Manitoulin Tourism Association. Several of the townships have passed a resolution and have forwarded it to the CRA and Ministry of Tourism, Culture and Sport.”

“The decision to go after private, family-fun campgrounds as a source of revenue to pay for out-of-control spending is a direct assault on middle class Canadians,” said Ms. Gallant in a press release. “Jobs in Northern Ontario are scarce. This is another attack on rural Canada. Scattering a few crumbs at Northern Ontario ignores the real problem of unfair taxation. Small campgrounds are asking to be treated like any other small business, which they are. By changing the way small campgrounds are taxed, they could be looking at a tax increase up to 50 percent higher than many billion-dollar corporations.”

“In Northern Ontario, camping is a seasonal business,” Ms. Gallant notes. “Employing five, full-time year-round employees is not realistic. This is penalizing children, seniors and working couples by taking away an affordable family vacation.”

The petition to the House of Commons in Parliament Assembled states, “we, the undersigned citizens of Canada, draw the attention of the House to the following: whereas, camping is about celebrating the great outdoors and is an integral part of our nation’s heritage and our identity as Canadians, with nearly 5.8 million Canadians going camping each year; And whereas, the Trudeau Liberal government has decided that some campgrounds are too small to qualify for the small business tax deduction, demanding tax payments at rates that are greater than those of billing-dollar businesses; and Whereas, campgrounds in Ontario have begun receiving calls and letters warning them of reassessments in part because they are deemed not to qualify for the small business tax deduction since they employ fewer than five people; with many family-run campgrounds being seasonal businesses that must close during the winter to meet their municipal bylaws and consequently easily fall below the five full-time equivalent (FTE) employee threshold set by Trudeau’s tax collectors; Therefore, your petitioners, call upon all Members of Parliament to implement changes that ensure campgrounds are recognized as small businesses and pay the same taxes as other small businesses.”

Camping in Ontario has an online petition for the cause as well which can be read and signed at change.org/p/minister-of-small-business-and-tourism-canadians-for-camping-supporting-canada-s-family-run-campgrounds.