bold, new tax reduction initiative will reduce
the general federal corporate income tax rate to
15 per cent by 2012 from its current rate of
22.1 per cent (...) The Government is seeking
the collaboration of the provinces and
territories to reach a 25 per cent combined
corporate income tax rate, to make Canada a
country of choice for investment.
support small business, the reduction in the tax
rate to 11% for small business, currently
scheduled to be reduced in 2009, will be
accelerated to January 1, 2008.
goods and services tax (GST) will be reduced by
a further 1 percentage point as of January 1,
2008, fulfilling the Government’s commitment to
reduce the GST to 5 per cent.
credit for low- and modest-income Canadians will
be maintained at its current level even though
the GST rate is being reduced. Maintaining the
credit, while reducing the GST rate to 5 per
cent from 7 per cent, translates into more than
$1.1 billion in benefits annually for low- and
lowest personal income tax rate will be reduced
to 15 per cent from 15.5 per cent, effective
January 1, 2007.
employment insurance rate in 2008 will decline
by 10 cents per $100 of insurable earnings for
employers and 7 cents for employees (from $1.80
As of January 1, 2008, the
first bracket of the tax table will cover the first
$37 500 of taxable income, with the second bracket
consisting of the portion of taxable income over $37
500, but not exceeding $75 000, and the third
bracket corresponding to taxable income over $75 000
(vs $29 290, $ 58 595 and $58 595 respectively).
Here are a few extracts,
related to businesses, from the document
The Budget in Brief published by Department
of Finance Canada:
federal paper burden on small
business by 20 per cent by
Reducing the tax
compliance burden on small
business by decreasing the
frequency of their tax
remittance and filing
the lifetime capital gains
exemption for farmers, fishermen
and fisherwomen, and small
business owners from $500,000 to
a performance-based rebate
program offering up to $2,000
for the purchase of a new
fuel-efficient or efficient
alternative fuel vehicle.
The interest rate used
to calculate taxable benefits for employees and
shareholders from interest-free and low-interest
loans will be 5%.
incorporated under the Canada Business
Corporations must now download
Form 22 and file it within 60 days of their
anniversary date instead of within 6 months
after their taxation year-end.