By Nichola Saminather
TORONTO (Reuters) – Toronto-Dominion Bank’s Chief Executive Bharat Masrani on Thursday criticized the Canadian Liberal government’s planned tax on banks and called for policymakers to ensure Canada plays a “meaningful role” in supporting energy security.
Canada plans to raise corporate taxes for the most profitable banks and insurers to 16.5% from 15% on all taxable income over C$100 million ($79.6 million), and imposed a one-time 15% tax on income over C$1 billion.
The proposal, first floated as a campaign promise by the Liberals in August, was detailed in last week’s federal budget. The proposal had already drawn the ire of bank executives and investors even before the budget announcement.
In his prepared remarks to the bank’s annual shareholder meeting, Masrani said the government’s decision to single out the banking sector was not good tax policy and could lead to “unintended consequences”.
“One of our greatest advantages is that we have among the strongest and most stable financial systems in the world,” he said. “We must extend our leadership on the world stage as a global banking centre.”
Masrani also called for Canada to play a “meaningful role” to support energy security across North America and globally, saying a transition to a low-carbon future will take years.
TD and other Canadian banks have been criticized by climate-conscious investors for their continued support of fossil fuel companies. Up for a vote at the meeting is a shareholder proposal calling for the bank to stop financing new fossil fuel supplies by the end of this year, which the board of directors recommended investors vote against.
“Without a reliable and responsible energy supply to meet current and future demand, progress may stall, with devastating economic and social consequences,” he said. “The pressure on energy supply as a result of the war in Ukraine is a clear example of the risks.”
($1 = 1.2564 Canadian dollars)
(Reporting by Nichola Saminather; Editing by Daniel Wallis)