Reaction and response to Finance Minister Jim Flaherty’s budget announcement came fast and furious from the financial industry.
Although all of today’s proclamations from the Conservative Party may come to naught if the budget is not passed, the opposition parties aren’t the only ones to express disappointment with the budget.
Despite benefits for seniors and students, one of Canada’s major accounting designations said the budget fell short. Anthony Ariganello, president and CEO of CGA-Canada, said the Income Tax Act is simply too complicated.
“CGA-Canada believes the government has a strong role to play in creating a positive environment for Canadian small business” he said. “And we believe that job is to take concrete action to improve Canada’s tax system—make it fairer, simpler and more efficient. As it stands, Canada’s tax system is among the most complex in the world—this hurts our economy and in particular poses a formidable challenge for industry and small business.”
The Investment Industry Association of Canada (IIAC), on the other hand, had nothing but praise for the Conservatives’ budget. It termed the five-year plan to eliminate the deficit as “credible” and sees Canada as leading the way to meet the G20 targets by halving its deficit by 2013 and stabilizing the public debt burden by 2016.
“We are pleased to see a long-term commitment to deficit and debt reduction in this five-year ‘Next Phase of the Economic Action Plan’,” said Ian Russell, president and CEO, IIAC. “Sound management of public finances gives manœuvrability for further incentives for savings and investment, the key to growth and job creation, as well as scope to meet the social spending demands from an aging demographic.”
The IIAC also applauds the two-year extension of the accelerated capital cost allowance for manufacturing investment that, together with the final reduction of the corporate tax rate to a globally competitive 15%, will boost business spending.
The Canadian Chamber of Commerce believes the budget will continue to support Canada’s economic recovery and help Canadian businesses prosper and compete.
“We are pleased that this budget does not plan for any tax increases,” said Canadian Chamber of Commerce president and CEO Perrin Beatty. “The Canadian Chamber and its network have been very active in the corporate income tax debate over the last few months and our message has been heard. Canada’s low tax plan has created a healthy economic environment for business investment and we applaud the government for staying the course.”
“The government has endorsed the Canadian Chamber of Commerce’s call for a plan to return to budget balance in the medium term,” Beatty added. “We are securing the fiscal flexibility that is crucial to our long-term competitiveness and it is encouraging that the government continues to focus on strengthening the economy and creating jobs. That is what businesses across Canada need now.”