One thing that has to be said about Canada’s minority Conservative government, is that it’s not tip-toeing around the issues. While many suspected a minority government would shy away from any controversial issues, Stephen Harper and his Cabinet have made several bold moves during their short reign.
So it makes perfect sense to try to resurrect some old issues that the former government repeatedly refused to address. One such issue that will impact most of you, is an attempt to restore the 80% meal deduction limit for Canadian truckers.
The 80% deduction limit was reduced to 50% in 1994, and that’s where it has remained. This while US truckers have been gradually inched upwards, back towards that 80% limit. The 1994 reduction was aimed at big-spenders in suits and ties who would wine and dine key clients at posh restaurants. Sadly, it was the truckers – those who spend most of their time away from home and have little choice but to eat out while on the road – who were once again caught in the middle.
Here’s an example that shows the impact of the 50% deduction limit: A driver on the road five days a week for 50 weeks of the year with an annual gross income of $50,000 is going to spend $12,750 on meals using the CRA’s receipt-free rate. At the current 50% deductibility rate, the driver will be taxed on $42,125 of taxable income. Using the proposed 80% rate, the driver will be taxed on just $38,300, resulting in a difference of $1,343.
So, if the industry’s lobby groups (in this case the Canadian Trucking Alliance, OBAC and the Teamsters union) are successful in their bid to have the 80% limit restored, it’ll save you an average of over $100 per month. More importantly, it will put you back in line with your US counterparts, who can already claim nearly 80% and will be able to claim the full 80% by 2008.
It’s nice to see OBAC and the CTA working together on this issue. O/Os and carriers don’t have to be constant adversaries, there are many issues they can work on together for the common good. Now, it’s up to you to do your part. Fill out the ‘postcard’ at our Web site (www.trucknews.com/brownbag) and send it in. There’s strength in numbers and here’s our chance to be heard. I sent mine in this morning.
James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at firstname.lastname@example.org or follow him on Twitter at @JamesMenzies. All posts by James Menzies