Taxes and prudent fiscal management highlight pre-budget input from Canada's
CAs

OTTAWA, Nov. 2 /CNW/ - Canada's Chartered Accountants today in Ottawa called for a simpler, more competitive corporate tax system and prudent fiscal management by the federal government.

The Canadian Institute of Chartered Accountants (CICA) appeared before the House of Commons Standing Committee on Finance as part of the pre-budget consultation process.

"We applaud the government's commitment to reducing the general corporate income tax rate to 15 per cent by 2012," said Bruce Flexman, Chair of the CICA's Tax Policy Committee. "In deciding whether or not to invest, businesses are driven by the need for certainty. In the current economic climate, it is crucial that the government remain visibly committed to reducing corporate tax rates."

Flexman added that complexity plays an equally important role in attracting investment.

"Canada's corporate tax system must be simplified in order to lessen the costs associated with the burden of compliance," he said. "The system can become more competitive, simpler and more efficient."

The CICA also notes that if Canada is to remain competitive and attract the best and the brightest, we need to stay attuned to the personal income tax burden placed on Canadians. In addition, the CICA is calling on the government to consider further incentives for retirement savings.

Innovation is another area where the CICA believes action can be taken citing the Scientific Research and Experimental Development program. The federal government is being urged to make investment tax credits fully refundable for all claimants, regardless of company size or to consider allowing an offset through which they are creditable against an employer's portion of EI premiums. Currently, investment tax credits are fully refundable only for smaller companies.

With respect to the country's finances, the CICA recognizes that this is a transition year as the federal government moves away from stimulus spending to a greater focus on restraint.

"The government must demonstrate the ability to rein in spending and prudently manage its finances going forward," stressed Flexman. "This is especially important in the near term, given that there is not a lot of room for error contained in the last federal budget. In other words, execution is the key."

The CICA submission to the committee titled "Enhancing Canada's Competitiveness" is available online (www.cica.ca/prebudget2010).

Chartered Accountants (CAs) are Canada's most valued, internationally recognized profession of leaders in senior management, advisory, financial, tax and assurance roles. Through their integrity, expertise, and internationally recognized qualification standards, Canada's 77,000 CAs sustain their influence and leadership position both in Canada and globally. As trusted business advisors to Canadian organizations of all sizes, Canada's CAs foster confidence in Canadian business and contribute to the health and sustainability of Canada's capital markets and economy. The Canadian Institute of Chartered Accountants (CICA) represents Canada's CA profession both nationally and internationally. The 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