Mr. DOUGLAS (Weybum):
Would it not be fairer if the government set standard profit figures for the different industries, and then taxed everything above that? Due consideration could be given to the turnover, the risk
Excess Profits Tax Act
involved, the particular function of the industry and all that sort of thing. If a company has had an average profit of two per cent over a period of years, it will now pay a tax on everything over two per cent. If it has had an average profit of sixteen per cent, it will be allowed to continue to make that profit before paying any tax. I am keeping in mind that there is a minimum which they must pay. This will work a hardship on firms which have had low profits for the last four years, and will work to the advantage of certain industries which have had fairly good years.
I have in mind mining companies and other concerns engaged in producing war materials. For the last four years they have done a fairly good business. They lost their foreign market, and the result has been that the war orders they are now receiving hardly more than make up for the loss of their foreign markets. The chances are that their profits will not greatly exceed their average profits for the last four years. Other industries, like the textile industry, had quite poor years in 1936 and 1937; their average profit will be quite low. Would it not be possible to consider the setting of a fixed profit figure for the different industries and then tax everything above that?
Topic: EXCESS PROFITS TAX ACT