The Canadian Union of Public Employees (CUPE), representing 750,000 members, is calling on Parliament to eliminate $54 million in annual tax breaks for real estate investment trusts (REITs) and to impose limits on pension fund investments in residential real estate.“The federal government must act immediately to close the tax loophole that allows real estate investment trusts to operate without paying any corporate tax,” CUPE stated in its submission to the Commons human resources committee. “This is money that could have been spent on creating affordable housing,” the union argued.REITs, which manage approximately 20% of Canada's purpose-built private sector apartments, benefit from a tax structure that exempts them from corporate taxes on profits distributed to shareholders. Like mutual funds, these trusts only pay taxes on the non-distributed portion of their income.“Real estate investment trusts are allowed to flow through their income to unit holders and pay taxes only on the non-distributed portion of their income,” noted the Parliamentary Budget Office in its 2023 report titled Cost Of Removing Tax Exemptions For Real Estate Investment Trusts. The report highlighted that these tax advantages have particularly benefited non-resident and non-taxable Canadian investors.The Budget Office also observed the “spectacular growth” of the REIT sector, which has expanded from $80 million in total trust assets in 1993 to $76 billion in 2021. The number of rental units owned by REITs grew from zero in 1996 to nearly 200,000 by 2021.In addition to calling for the repeal of favorable tax treatment for REITs, CUPE is advocating for legislation that would restrict pension funds from holding investments in residential real estate. The union also supports “strengthening capital gains taxes” but stopped short of endorsing a home equity tax on Canadians’ primary residences.“Prime Minister Justin Trudeau has stated housing needs to retain its value and is ‘a huge part of people’s potential for retirement and a future nest egg,’” CUPE wrote to the committee. “This perspective results in an environment where increased housing affordability is perceived as harmful.”Despite CUPE's appeal, the Commons human resources committee rejected the repeal of tax breaks for REITs in an October 26 report on the financialization of housing. The committee recommended only that the government “examine the social and economic costs and benefits of the current tax treatment.”While a 2021 Ministerial Mandate letter suggested “possible reforms to the tax treatment of real estate investment trusts,” the finance department’s April 16 budget merely acknowledged the need to address “the role of large corporate investors in our single-family housing market” without offering further details..This is what the Western Standard is up againstThe Trudeau government is funding lies and propaganda by directly subsidizing the mainstream media. They do this to entrench the powerful Eastern, woke and corrupt interests that dominate the political, social and economic institutions in Canada. Federal authorities are constantly trying to censor us and stop us from publishing the stories that they don’t want you to read. Ottawa may weaponize our taxes and police against us, but we’ve got a powerful ally on our side.You. Free men, and free women. We need you to stand with us and become a member of the Western Standard. Here’s what you will get for your membership:Unlimited access to all articles from the Western Standard, Alberta Report, West Coast Standard, and Saskatchewan Standard, with no paywall. Our daily newsletter delivered to your inbox. .Access to exclusive Member-only WS events.Keep the West’s leading independent media voice strong and free.If you can, please support us with a monthly or annual membership. It takes just a moment to set up, and you will be making a big impact on keeping one the last independent media outlets in Canada free from Ottawa’s corrupting influence.
The Canadian Union of Public Employees (CUPE), representing 750,000 members, is calling on Parliament to eliminate $54 million in annual tax breaks for real estate investment trusts (REITs) and to impose limits on pension fund investments in residential real estate.“The federal government must act immediately to close the tax loophole that allows real estate investment trusts to operate without paying any corporate tax,” CUPE stated in its submission to the Commons human resources committee. “This is money that could have been spent on creating affordable housing,” the union argued.REITs, which manage approximately 20% of Canada's purpose-built private sector apartments, benefit from a tax structure that exempts them from corporate taxes on profits distributed to shareholders. Like mutual funds, these trusts only pay taxes on the non-distributed portion of their income.“Real estate investment trusts are allowed to flow through their income to unit holders and pay taxes only on the non-distributed portion of their income,” noted the Parliamentary Budget Office in its 2023 report titled Cost Of Removing Tax Exemptions For Real Estate Investment Trusts. The report highlighted that these tax advantages have particularly benefited non-resident and non-taxable Canadian investors.The Budget Office also observed the “spectacular growth” of the REIT sector, which has expanded from $80 million in total trust assets in 1993 to $76 billion in 2021. The number of rental units owned by REITs grew from zero in 1996 to nearly 200,000 by 2021.In addition to calling for the repeal of favorable tax treatment for REITs, CUPE is advocating for legislation that would restrict pension funds from holding investments in residential real estate. The union also supports “strengthening capital gains taxes” but stopped short of endorsing a home equity tax on Canadians’ primary residences.“Prime Minister Justin Trudeau has stated housing needs to retain its value and is ‘a huge part of people’s potential for retirement and a future nest egg,’” CUPE wrote to the committee. “This perspective results in an environment where increased housing affordability is perceived as harmful.”Despite CUPE's appeal, the Commons human resources committee rejected the repeal of tax breaks for REITs in an October 26 report on the financialization of housing. The committee recommended only that the government “examine the social and economic costs and benefits of the current tax treatment.”While a 2021 Ministerial Mandate letter suggested “possible reforms to the tax treatment of real estate investment trusts,” the finance department’s April 16 budget merely acknowledged the need to address “the role of large corporate investors in our single-family housing market” without offering further details..This is what the Western Standard is up againstThe Trudeau government is funding lies and propaganda by directly subsidizing the mainstream media. They do this to entrench the powerful Eastern, woke and corrupt interests that dominate the political, social and economic institutions in Canada. Federal authorities are constantly trying to censor us and stop us from publishing the stories that they don’t want you to read. Ottawa may weaponize our taxes and police against us, but we’ve got a powerful ally on our side.You. Free men, and free women. We need you to stand with us and become a member of the Western Standard. Here’s what you will get for your membership:Unlimited access to all articles from the Western Standard, Alberta Report, West Coast Standard, and Saskatchewan Standard, with no paywall. Our daily newsletter delivered to your inbox. .Access to exclusive Member-only WS events.Keep the West’s leading independent media voice strong and free.If you can, please support us with a monthly or annual membership. It takes just a moment to set up, and you will be making a big impact on keeping one the last independent media outlets in Canada free from Ottawa’s corrupting influence.
