Canada Will Continue To Cut Federal Taxes, Says Manley

by Leroy Baker, Tax-News.com, New York

26 November 2003

In a speech given to the Council of the America’s in New York on Tuesday, Canadian Finance Minister John Manley said that the federal surplus allows room for further tax cuts in the years ahead, despite the country’s somewhat fragile economic state.

"We've introduced the largest tax reduction program in Canadian history, a multi-year initiative that will be complete by the end of this year," Mr Manley boasted.

"This tax reduction plan has created a distinct Canadian advantage, with an average federal-provincial corporate tax rate now below that of the US and expected to fall even further in the future," the Finance Minster claimed, although without specifying exactly where taxes were to be cut.

Earlier in the year, Manley announced that the federal surplus will total $2.3 billion in the current fiscal year, although with $2 billion earmarked for healthcare in the provinces, it will leave precious little in the coffers to cover the usual $3 billion federal contingency fund.

The Finance Minister’s cause will not be helped by the news that the new Liberal government of Ontario is intending to enact legislation reversing planned corporate and personal tax cuts, and replacing them with increased tax rates for businesses.

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