Income Tax Receipts Bolster Canadian Coffers

by Mike Godfrey, Tax-News.com, Washington

02 February 2012

While Canadian tax revenues fell by 0.2% in November, 2011, receipts were up 3.9% for the first eight months of the 2011–12 fiscal year, new figures have shown.

According to the latest Fiscal Monitor, revenues dropped by CAD48m compared with November, 2010. The Finance Department attributes this to lower excise taxes and duties and other revenues. Excise taxes and duties fell by CAD0.3bn, or 8.5%. Goods and Services Tax (GST) revenues were down CAD0.3bn (11.1%), with energy taxes down CAD1m, customs import duties lower by CAD4m, and other excise taxes and duties dropping by CAD29m.

These falls were, however, largely offset by higher income tax revenues. Personal income tax revenues were up CAD0.2bn (2%), with corporate income tax revenues increasing by CAD0.8bn, or 47.4%. In addition, non-resident income tax revenues were up CAD6m (1.5%). Employment Insurance (EI) premium revenues rose by CAD38m, (4.7%), which the Department says is consistent with the 2011 premium rate of CAD1.78 per CAD100 of insurable earnings.

For the first eight months of the 2011–12 fiscal year, receipts were up CAD5.7bn (3.9%). This the Department says primarily reflects higher income tax revenues, which were partially offset by lower GST revenues and other revenues. Personal income tax revenues rose by CAD4.7bn (6.4%), while corporate income tax revenues were up CAD2.3bn (16%), reflecting an increase in receipts of about 6.6% and a decrease of 6.8% in refunds of taxes paid.

Excise taxes and duties were down CAD1.0bn (3.7%), which the Department says mainly reflects a decrease in GST revenues of about CAD1.2bn (6.3%). Energy taxes were up CAD17m, customs import duties were up CAD0.2bn, and other excise taxes and duties were down CAD0.1bn. EI premium revenues rose by CAD0.5bn (4.8%).

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