The Canada Truck Operators Association (CTOA) is warning that the federal government’s plan to tighten enforcement of tax rules in the trucking industry could worsen Canada’s driver shortage and destabilize an already fragile supply chain.
Appearing before Brampton council on Nov. 12, CTOA spokesperson Tej Dulat said independent drivers, owner-operators and small trucking businesses are being squeezed by economic pressures, U.S. tariffs, rising costs, slowing freight demand — and now a growing federal crackdown.
Dulat urged the City of Brampton to recognize truckers’ economic importance, reject negative stereotypes, and push senior governments to consult grassroots drivers before imposing new reporting requirements. Council unanimously agreed to refer the matter to staff, a move Dulat called a rare acknowledgment of independent truckers’ contributions.
Federal Enforcement Plan Raises Alarm
The 2025 federal budget allocates $77 million over four years for the Canada Revenue Agency to lift its moratorium on penalties for failing to report fees-for-service transactions — a move aimed at tackling what critics call the underground Driver Inc. model, where companies misclassify drivers to avoid taxes, labour obligations and safety standards.
Dulat said the timing is dangerous.
With labour shortages already straining the supply chain, CTOA’s internal feedback shows 23% to 25% of long-haul drivers may leave the industry if forced into a single employment model or overwhelmed by new reporting rules — a shift that could mean delayed deliveries, higher shipping costs and major supply-chain disruptions.
CTOA wants Ottawa to:
- Apply T4A rules fairly across all industries
- Conduct an impact assessment on small carriers
- Provide free digital tools and multilingual support
- Implement a phased rollout for penalties
The Driver Inc. Debate
At the heart of the controversy is whether long-haul drivers should be treated as employees or small business owners.
Many independent drivers legally incorporate to gain flexibility, tax planning options and the ability to eventually buy their own truck. Critics say the model enables misclassification. CTOA says the issue is being misunderstood.
“The biggest misunderstanding is that incorporated drivers are doing something illegal simply because they are incorporated,” Dulat said, pointing to recent testimony from CRA officials affirming the model itself is not illegal — the concern is proper tax compliance.
He warned that mixing safety debates with tax issues benefits large carriers at the expense of independent operators.
Safety Concerns Must Be Addressed Separately, CTOA Says
Following several high-profile crashes in Peel Region, Dulat acknowledged community concerns and stressed that families calling for safer roads “are right.”
But he said solutions lie in:
- Licensing reforms
- Stronger enforcement of repeat-offender carriers
- Better training and safety oversight
—not in restricting legitimate entrepreneurship.
“You cannot fix safety by eliminating entrepreneurship; you fix safety by eliminating unsafe carriers,” he said.
A Call for Balance
Dulat said Brampton’s trucking workforce — made up of more than 60% diverse community members — should not be vilified by social-media narratives portraying them as cheaters or lawbreakers.
“Brampton’s trucking community and its neighbourhoods are not on opposite sides,” he said. “A city with strong planning, fair enforcement and proper infrastructure can have both safe streets and a thriving trucking workforce.”