Canadian Accountants Welcome Corporate Tax Cut Announcement

by Carla Johnson, Investors Offshore.com, London

02 November 2007

Canada's Chartered Accountants have been encouraged by the federal government's plan to accelerate tax relief for individuals, families and businesses, according to a statement issued on Tuesday.

Kevin Dancey, FCA, President and CEO of the Canadian Institute of Chartered Accountants (CICA) announced that: "The government's commitment to reduce the general corporate tax to a rate of 15% by 2012 is a positive step toward making Canadian companies more competitive."

While Dancey welcomed the government's decision to reduce overall taxes and to commit an additional $10 billion for debt reduction this year, he said corporate taxes need to be reduced further and faster than currently planned.

CICA has been calling on the government to reduce corporate taxes, which it believes are hampering the competitiveness of Canadian businesses.

The Institute first raised the issue in its submission to the House of Commons Standing Committee on Finance in September, 2006, when it urged the government to drive the general corporate tax rate down to the small business level.

"The additional percentage point reduction in the general corporate rate in 2008, together with the plan to reduce the small business tax rate to 11% next year, will help stimulate business growth and job creation," Dancey observed.

However, he added that: "We'd like to see the government go faster and even further, by reducing the corporate tax rate so that it matches the small business rate, a move that would simplify the tax structure and enhance the prosperity of all Canadian businesses."

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