Honourable Charles Sousa
Ontario Minister of Finance
7th Floor- Frost Building South
7 Queen's Park Crescent
Toronto, ON M7A 1Y7
RE: Proposed Tax Fairness for Realtors Act, 2014
I am writing today to express my support for the Tax Fairness for Realtors Act, 2014 introduced by Prince Edward--Hastings MPP Todd Smith. If passed, this bill will allow real estate salespeople to form personal corporations. At present, the Real Estate and Business Brokers Act, 2002 (REBBA) prevents REALTORS® from operating their business through a Personal Real Estate Corporation (PREC).
I respectfully request that you consider allowing personal real estate corporations in the upcoming 2014 Ontario Budget. This change will help the government achieve its goals of promoting economic growth and will ensure Ontario is fair place for Ontario REALTORS® to do business.
Positive Economic Impact
A recent study by the Centre for Spatial Economics (C4SE) commissioned by OREA found that PRECs will more than pay for themselves even if only a third of deferred tax revenue is reinvested in the corporation.
Incorporated REALTORS® would reinvest immediate tax savings into their businesses by purchasing a number of third-party services, new technology and hiring new staff. This reinvestment will translate positively for Ontario jobs and the economy. C4SE’s report found that PRECs:
- Would create between 33 to 89 net new jobs annually;
- Increase Ontario's provincial revenue by an annual average of $0.8 million to $2 million; and,
- Would contribute between $9 million to $25 million annually to Ontario’s GDP.
Tax Fairness for Real Estate Professionals
Since 2008, British Columbia, Quebec, Manitoba, Saskatchewan, Alberta and Nova Scotia have allowed real estate salespeople to incorporate. Based on the experience in other Canadian jurisdictions there is no reason to continue prohibiting Ontario real estate professionals from incorporating. REALTORS® who choose to form personal corporations will continue to be subject to all professional and ethical obligations under REBBA.
Furthermore, this proposed legislation will help align the rights of real estate professionals with those of other regulated professions in Ontario such as chartered accountants, health professionals, and lawyers, who already enjoy the ability to self-incorporate.
To conclude, I respectfully request that you consider allowing personal real estate corporations in the upcoming 2014 Ontario Budget. This change will help the government achieve its goals of promoting economic growth and creating jobs, and will ensure Ontario is a competitive and fair place for Ontario REALTORS® to do business.
1912 Giles Ave
Honourable Jeff Leal,
MPP - Peterborough