The Chartered Professional Accountants of Canada (CPA Canada) are calling on the federal government to reform tax regulations.
On October 27, CPA Canada president and CEO Kevin Dancey appeared before the House of Commons Standing Committee on Finance as part of the annual consultation process that takes place in advance of the federal budget. He argued that Canada's taxation regime needs to be reformed in order to strengthen the country's economy.
“Tax reform would improve Canada's international competitiveness, productivity, economic growth and long-term prosperity,” he said. “There has not been a thorough review of Canada's tax system since the Royal Commission on Taxation in 1966.”
The accounting organization recommends, among other things, that Canada index current tax thresholds to inflation and competing tax jurisdictions, and adjust capital cost allowance rates for all classes of equipment to correspond with the true economic life of the assets. CPA Canada also believes the alternative minimum tax should be eliminated or significantly reduced, and that the $10 million small business taxable capital limitation should be indexed to inflation.
When economic conditions allow, CPA Canada would also like the government to reduce personal income tax rates and offset the resulting loss of tax revenue by increasing consumption taxes.
"We acknowledge that the government has introduced measures to lower taxes and has made improvements to ease the compliance burden, but more can be done," said Dancey.
