Canada Set To Cut Corporate Taxes, Official Says

Posted on Saturday, September 10 at 08:42 by FootPrints
The cuts were initially put at C$4.6 billion over a five-year period but a Finance Department official could not immediately provide the value of the cuts that will be reintroduced. Finance Minister Ralph Goodale touched on the subject of tax cuts in a speech in Vancouver on Thursday. "Some (tax cuts) were legislated in spring, others will be put before the House of Commons in the fall. Our intention is to proceed with our full tax reduction as promised and on time," Goodale said. The Liberals hold only a minority of seats in the House of Commons and need the support of at least one other party to stay in power. The official dismissed media speculation that the autumn fiscal update might be a full-blown budget or a "mini-budget" that could pave the way for an early federal election. The official also said Goodale has invited provincial and territorial ministers responsible for securities regulation to a September 29 meeting to discuss ways to attract more foreign direct investment. Quebec has confirmed it will attend, the official added. Goodale is willing to consider options including regulatory reforms along the lines of the U.S. Sarbanes-Oxley legislation, the creation of a national securities regulator, or the adoption of a passport-style securities transaction system, the official added. Canadian provinces currently have separate regulators and critics say that makes it difficult to do business in Canada. http://news.yahoo.com/news?tmpl=story&u=/nm/20050908/wl_canada_nm/canada_economy_canada_fiscal_col_2 [Proofreader's note: this article was edited for spelling and typos on September 10, 2005]

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  1. by RPW
    Sat Sep 10, 2005 3:50 pm
    <u><i>"The official told Reuters that bringing back the tax cuts would be a way to maintain Canada's competitive position in the global economy."</i></u> <p>Anyone want to bet that, if personal income taxes were cut to the bone, instead of corporate taxes, we'd be extremely competitive? Can anyone reading this imagine what an extra 25% in the pockets of individuals would do for the Canadian economy, and by extension our positioin in the global one?</p> <p>---<br>RickW

  2. Sat Sep 10, 2005 7:23 pm
    Amen. It's just that the WRONG corporations and businesses would benefit.

  3. Sat Sep 10, 2005 7:43 pm
    We ALREADY have one of the lowest corporate tax rates in the world. This is just another handout to the already rich. Corporate profits across the board are setting records every year, layoffs continue and take home wages have been flat for 20 years. Welcome to Lieberal-unConservative feudal world.<br />
    <br />
    This graph sums it up nicely - <br />
    <a href="http://www.canadiandemocraticmovement.ca/displayarticle580.html">www.canadiandemocraticmovement.ca/displayarticle580.html</a>

  4. Sat Sep 10, 2005 8:24 pm
    But those Ceo's and corporate big-wigs want
    their 3 yacht/7th car/4th house !

    Darren Entwistle deserves ANOTHER multi-million
    dollar bonus/50% salary increase ! While his
    workers should NOT get proportionate
    benefits.

    How dare you restrict greed and rampant
    materialism... how DARE you (damn socialists).

    The trickle-down (aka dripping faucet) economic
    theory cannot be disputed !

    ;-)

  5. by RPW
    Sun Sep 11, 2005 12:53 am
    Flat-rate tax, across the board, no deductions, on gross incomes, no exceptions - say 10%?

    2004 GDP: $ 1,023,000,000,000. That would give the government an annual income of $100 billion.

    ---
    RickW

  6. by hoopoe
    Sun Sep 11, 2005 5:04 am
    I'm sorry but you have misunderstood what the GDP is; it can't be used to do the calculation you have done here since it represents the value of all of the goods and services produced by the country and in actual fact income is not a component of the GDP.

  7. Sun Sep 11, 2005 8:10 am
    I think most Canadians have figured out who our government is working for and it isn't us! Corporate taxes have hardly moved for years, and they are very low, personal taxes continue to rise, and the Canadian debt keeps on escalating! The workers get hungry and poor, and can pay their own healthcare when they get sick, after the corporations are through spewing pollution into our air, water and wherever else they wish, if they chose to, laws are made to stiffle private citizens speech and invade our privacy, but we can brag about those foreign corporations paying less taxes, oh how sad! Who is going to pay for the clean ups, if they ever happen, say after a train wreck spews poison in the water? Maybe we could have a telethon or bingo?

    ---
    If I stand for my country today...will my country be here to stand for me tomorrow?

  8. Sun Sep 11, 2005 3:04 pm
    Citizens are taxed because they make use of the services provided by the three levels of government.<br />
    <br />
    Citizens make use of public schools and hospitals, roads and highways, water and sewer services, power and communications access, and demand police and fire protection, not to mention a military force strong enough to protect the nation's sovereignty and help in times of emergency and disaster. Citizens also need regulated standards for food, clean water, and a myriad of other products and services that work well and safely because of government imposed standards. These are just a few of the needs of Citizens. All of these things cost dollars and are paid for by taxing the Citizen. A flat tax rate of say between 10-35% (based on total income of course) would seem fair for all these services and protections!<br />
    <br />
    Corporations are taxed because they make use of the services provided by the three levels of government.<br />
    <br />
    Corporations make use of people educated in public schools whose health is maintained by public hospitals. They ship their products on public roads and highways, consume water and sewer services, require power and communications access, demand police and fire protection, and demand a nation strong enough to enforce international trade laws. These are just a few of the needs of Corporations. All of these things cost dollars and are paid for by taxing the Corporation. A flat tax rate of say 15-40% would seem fair (based on total revenues of course) considering that many of these services are used to a much larger degree by Corporations than by Citizens.<br />
    <br />
    However grudgingly, both Citizens and Corporations pay taxes, and both receive benefits in the form of the services and protections they enjoy. The problems start however when those that consume the larger share of the provided services are paying the smaller share of the tax burden, and problems also arise when those that have the most disposable dollars pay the lowest percentages of tax.<br />
    <br />
    Corporation or Citizen, both are treated equally as legal entities and have protections, as well as responsibilities, under the law. <br />
    <br />
    If we are both so equal, why do Corporations on average pay about 30 cents tax on every dollar, while Citizens pay about 60 cents tax on every dollar?<br />
    <br />
    Wait a minute says Citizen Joe/Jane, I only have about 30% deducted in taxes from my pay! Where is this 60% coming from? Think about it for a minute, income tax represents less than half of a Citizen's total tax bill. <br />
    <br />
    Other taxes such as; Canada Pension Plan, Employment Insurance premiums, property taxes, HST and GST on purchases, capital gains taxes, non-refundable bottle deposits, vehicle registrations and licenses, road-tolls, the miscellaneous user-fees charged for various government services, and heavier taxes and fees on other items deemed for one reason or another to warrant these heavier taxes, items such as tobacco, liquor and gas. There are other not so obvious taxes based on usage, such as water bills and airport-user fees, dog licenses, etc. All of these taxes and fees take a big bite out of a Citizens income, as high as 2/3 or the total Citizens tax burden according a 2003 report from that venerable Canadian Institution, the Fraser Institute.<br />
    <br />
    "Income taxes accounted for only 32 percent of the taxes the average Canadian family paid in 2003. All those other, not so obvious, taxes accounted for the other two-thirds of the tax bill."<br />
    <br />
    In addition, because these user fees and taxes are so varied and unevenly applied across the country, it is impossible to come up with an accurate figure, however the figure of 60 cents of every Citizens dollar going to the tax man would indeed be a conservative national estimate.<br />
    <br />
    Which leads us to the Corporate Citizen. As earlier discussed the Corporation is a much heavier user of many of the services provided or subsidised by tax payer dollars. Notice the proportion of commercial freight to passenger vehicles on our roads and rails, it seems Corporations make very good use of our infra-structure. Think your power bill of $100-$150 a month is high, imagine a power bill of say $10,000 a month! Yes, Corporations are immense consumers of the services and infra-structure either provided by, maintained, or in some way supported though tax dollars, however, Corporations have been contributing less and less of these tax dollars to the pool year after year. <br />
    <br />
    In 2000 the general Federal Corporate tax rate was 28%. In 2004 it was 21%. <br />
    <br />
    But wait, says ACME Corporation, we also pay Canada Pension Plan, Employment Insurance premiums, property taxes, HST and GST on purchases, capital gains taxes, non-refundable bottle deposits, vehicle registrations and licenses, road-tolls, the miscellaneous user-fees charged for various government services and so on and so on.<br />
    <br />
    Indeed they do, but they also get those dollars back big time. Would the government refund to you every dollar of HST/GST you pay? No, only Corporations have that right. Would the government guarantee your loan, or subsidize the rate you pay your gardener or home worker? Doubtful. Yes indeed Corporations pay big tax bills... but they also reap many more benefits than the Citizen.<br />
    <br />
    So I put this to every Canadian Citizen, if you are content with 60 cents of every dollar you earn, while only 30 cents of every Corporate dollar earned, landing in the tax man's pocket, you need do nothing. If however, this outrages you as much as it does me, here is the link to find your local Member of Parliament. Tell him or her that you disapprove of the Corporate tax cuts will that will be put before the House of Commons this fall.<br />
    <br />
    -Nobles need not pay taxes!?<br />
    <br />
    <a href="http://www.parl.gc.ca/common/senmemb/house/members/CurrentMemberList.asp?Language=E&Parl=38&Ses=1&Sect=hoccur&Order=PersonOfficialLastName">http://www.parl.gc.ca/common/senmemb/house/members/CurrentMemberList.asp?Language=E&Parl=38&Ses=1&Sect=hoccur&Order=PersonOfficialLastName</a><p>---<br>--Snowdog<br />
    ___________<br />
    Canadians First!

  9. Sun Sep 11, 2005 6:20 pm
    whelen costen I totally agree.Some side-effects
    of a primarily capitalistic mixed economy are
    heaps of dead homeless bodies in big cities like
    Toronto & Vancouver (which can be ignored if
    you worship the dollar $ign over people), and
    environmental accidents caused by profit-driven
    companies trimming maintenance/monitoring costs.
    Also in the States, people without healthcare
    often have to sell everything they own for
    surgery/medication costs, making them
    homeless and totally destitute.

    There are many more, but corporatists conveniently
    ignore/dismiss them.Now imagine what would happen
    if we had 100% PURE unbridled Laissez-faire
    capitalism... it would be profit-heaven, but
    a social nightmare.A dog eat dog society where
    if you couldn't attain the standards of
    productivity and independance, you'd suffer,
    starve, get sick and perish.I guess every
    action/inaction should have a correlated
    effect/penalty, eh ?

  10. by RPW
    Sun Sep 11, 2005 9:56 pm
    Sorry, but I did not entirely misunderstand GDP. Where I erred is using the phrase "gross income" when I actually meant "transactions". The government would operate somewhat like a broker, in that a percentage would be charged the "client" everytime a transaction took place.

    So, whether a person bought a packet of gum for a buck and paid a dime in taxes, or bought a billion in shares and paid $100 million, the government would collect it's "tithe".

    ---
    RickW



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