Canada, The New Low-Tax Jurisdiction?
June 16, 2011 Taxation in Canada
The Canadian Finance Minister has given a speech on Wall Street touting Canada as a new low-tax jurisdiction for American businesses wishing to operate on the international market.
In an effort to woo a greater numbers of international investors to Canada, the Finance Minister Jim Flaherty gave a speech in New York on June 15th, espousing the country’s economic and taxation benefits.
According to the Minister, Canada is the lowest taxed jurisdiction for businesses among all of the G7 nations. He went on to say that the government of Canada has lowered its federal corporate tax rate, and eliminated capital gains taxes with the explicit aim of creating a beneficial tax situation for multinational businesses which operate from Canada. The federal government is also strongly encouraging provincial authorities to concurrently lower their business tax rates. Summarizing the primary goals of the government’s economic vision, he said that before the end of 2013 most business income in Canada will be taxed at a combined federal-provincial rate of 25 per cent.
The Minister revealed the government’s plans for changes to the tax system, saying that Canada intends to be the first “tariff-free zone for industrial manufacturers in the G-20”, and is also investigating and actively pursuing tax measures which will boost job growth and economic prosperity.
In an effort to assure business operators that Canada’s advantageous tax situation will be maintained in the foreseeable future, he drew attention to the country’s performance through the period of financial turmoil of recent years. He said that Canada is now expected to be one of only two G7 nations to see a budgetary surplus by 2016, and the country saw no major banking sector collapses, unlike some of its major trading partners.
Photo by Lone Primate