Opinion: Revenue Canada should audit Trudeau's free vacations

financialpost.com:

By Allan Lanthier

As has been widely reported, Prime Minister Justin Trudeau and his family vacationed at a luxury resort in Jamaica over the holidays. And it wasn’t just any vacation: they stayed at a 5,000-square-foot villa, with six bedrooms and a private swimming pool just steps away from a private, secluded beach. The villa was staffed by a cook, housekeepers and butlers.

Mr. Trudeau didn’t have to pay a cent: the resort is owned by Peter Green, a longtime friend of Trudeau’s late father, and was provided at no cost. Had the prime minister been charged the going rate, he would have paid about $84,000 for the nine-day stay. While no one begrudges a hard-working Canadian a Christmas vacation to escape the cold and snow, Mr. Trudeau is an employee of the federal government, and so the tax question is whether he received the $84,000 as a taxable employment benefit.

Under our tax act, employees are taxed on the value of almost all employment benefits. For example, if you attend your employer’s holiday party and the employer’s cost is more than $150 a person, you are taxed on the entire amount, whether you wanted to attend or not. So is Mr. Trudeau taxable on the $84,000?

He’s not employed by Peter Green, of course. But that’s not actually relevant. An employment benefit is taxable whether provided by an employer or a third party, a fact the tax authorities have confirmed time and time again. In 1968, for example, Canada’s Exchequer Court considered a situation where an employee and his wife received an expense-paid vacation — a Caribbean cruise arranged and paid for by a supplier of the man’s employer. The court decided that the entire cost of the vacation — a cost of $1,384 at the time, which is about $13,400 in 2023