The government has announced plans to allocate funds in the upcoming budget to combat a tax evasion scheme within the trucking industry known as “Driver Inc.” This scheme involves misclassifying drivers as independent contractors instead of employees to avoid payroll taxes.
As part of the federal budget set to be presented on November 4, the government intends to allocate $19.2 million annually starting in 2026-27 to address this issue. The funds will be utilized by the Canada Revenue Agency to enhance compliance efforts.
Jobs Minister Patty Hajdu emphasized the importance of addressing misclassification, stating that it exploits workers, deprives them of their rights, and creates an unfair advantage for companies that comply with regulations. The initiative aims to protect vulnerable workers, including newcomers to Canada.
Stephen Laskowski, the President and CEO of the Canadian Trucking Alliance, has long been advocating for government action against the Driver Inc. scam. Laskowski highlighted the urgency of the situation, pointing out the implications for compliance, road safety, drug trafficking, human rights violations, labor law breaches, and tax fraud.
The Bloc Québécois welcomed the government’s tax reform measures to tackle Driver Inc., one of the 18 requests made by the party ahead of the budget announcement. Transport Minister Steven MacKinnon acknowledged that the government’s response aligned with the Bloc’s concerns.
The Bloc Québécois transport critic, Xavier Barsalou-Duval, expressed satisfaction with the government’s actions but called for further investigation and efforts to address driver exploitation in the trucking industry. Conservative MP Philip Lawrence pressed for a concrete timeline to resolve the Driver Inc. issue, prompting discussions on the historical context of misclassification regulations.
The government aims to lift penalties for non-compliance with reporting requirements and implement measures to curb the exploitation of drivers through misclassification. Hajdu emphasized the significance of regulatory measures in combating fraudulent practices within the industry.