Updated Tax Changes Better – Review Still Needed
Last week, the Federal Government announced revisions to the proposed tax reform and a reduction to the small business tax rate. I am happy to see the government listening to the comments and concerns from small businesses and chambers across Canada. This is a step in the right direction and we thank the Government for this, but more needs to be done.
The business landscape is constantly changing. The United States is proposing significant changes to their tax system and other countries are changing in order to attract new businesses. The changing regimes paired with other factors including the NAFTA negotiations and eventual outcomes will affect Canadian businesses and the economy.
With this change to tax upon us, now is the time for a complete review of the Canadian Tax system. At the recent Canadian Chamber of Commerce AGM, delegates from across the country supported the formation of a Royal Commission to conduct a review of the tax system. In addition, we applaud our local MP Ron McKinnon for his letter to Finance Minister, Bill Morneau, asking for an independent study on the matter.
From the recent announcement, we’ve learned that the government will not be moving forward with measures relating to the conversion of income into capital gains, they will reduce the small business tax rate to 9 percent, and they will move forward with the limit to tax deferral benefits of passive investments in private corporations but intends to provide flexibility for small business owners.
With growing connectivity between nations and constant political evolutions, a thorough review of the tax system is imperative. This is our opportunity to improve the system – making it more beneficial to all. Members of chambers across Canada and here in the Tri-Cities are ready to work with the government to make it happen.
Michael Hind, CEO