Federal government must remain committed to corporate tax cuts: Canada's CAs

TORONTO , Oct. 26 /CNW/ - Canada's Chartered Accountants today urged the House of Commons Standing Committee on Finance to recommend that the federal government stay the course on its commitment to reduce corporate taxes as part of an overall plan to support Canada's long-term economic prosperity.

The Canadian Institute of Chartered Accountants (CICA) believes the next federal budget must include measures aimed at creating wealth, boosting job creation and facilitating capital mobility.

"Delivering on the government's commitment to cut corporate taxes is essential to this happening," stressed Bruce Flexman, Chair, Tax Policy Committee, CICA. "Now more than ever, Canada needs the right tax and fiscal framework to set the stage for sustainable recovery and economic growth."

The federal government's plan calls for the corporate income tax rate to be cut to 15 per cent by 2012.

"As finances permit, the government should look to reduce the corporate rate even further," noted Flexman. "The government also must stay attuned to the personal tax burden placed on Canadians in order for Canada to stay competitive and both attract and retain human capital. We also urge adoption of the recommendations contained in the report of the Advisory Panel on Canada's System of International Taxation aimed at ensuring the country is better able to compete globally."

Flexman added: "Recent developments on the sales tax harmonization front are welcomed and we encourage further action."

The CICA also is calling for government spending to be monitored closely to ensure that any deficit spending does not become entrenched.

"It is clear that the country's economic challenges require additional stimulus, but the government must protect against such measures resulting in a return to the structural deficits of the past," said Flexman. "It is a difficult balancing act, especially now, as there is no assurance that the economy has entered a period of sustainable recovery despite some promising forecasts. We urge the government to follow through on the 'exit strategy' that is built into its economic plan and ensure that spending on temporary measures ends as scheduled."

The Canadian Institute of Chartered Accountants (CICA), together with the provincial, territorial and Bermuda Institutes/Ordre of Chartered Accountants, represents a membership of approximately 75,000 CAs and 12,000 students in Canada and Bermuda . The CICA conducts research into current business issues and supports the setting of accounting, auditing and assurance standards for business, not-for-profit organizations and government. It issues guidance on control and governance, publishes professional literature, develops continuing education programs and represents the CA profession nationally and internationally. CICA is a founding member of the International Federation of Accountants (IFAC) and the Global Accounting Alliance (GAA).

For further information: or to arrange an interview, contact: Tobin Lambie, Manager, Media, CICA, [phone], [email protected], www.cica.ca