Le Lézard
Classified in: Business
Subjects: ECO, AVO

Economic statement: Ottawa is on the wrong track


MONTREAL, Nov. 19, 2018 /CNW Telbec/ - On Wednesday, with its economic statement, Ottawa is expected to announce targeted measures to attract investment to Canada and help businesses diversify their exports. The MEI points out again that this will not solve our fundamental competitiveness problem; the government should instead lower corporate taxes in order to restore the Canadian advantage.

"The recent tax cuts in the United States are exacerbating a problem that has hampered the Canadian economy for a long time: Investment is much lower here than in the rest of the industrialized world," explains economist Mathieu Bédard. "The competitiveness of our companies has fallen considerably, and the United States is now much more welcoming to investors."

Up until recently, the average combined corporate income tax rate was 39% in the United States, versus just 27% here. This clear advantage disappeared with the US tax cuts, which dropped the American rate to 26%, just below the Canadian rate.

A recent PwC study looking at all sectors of the Canadian economy estimated, among other things, that the US tax cuts could lead to the loss of 655,000 job in Canada, and over $20 billion in tax receipts, should Ottawa fail to respond.

"Whether we like it or not, the vast majority of our international trade is with the United States. Canada and its companies are competing as much to obtain market share as to attract investment. We have no choice about keeping tabs on what happens over there, and adjusting our public policies accordingly," adds Mr. Bédard.

"Ottawa should restore the Canadian advantage and lower the corporate income tax rate in order to stimulate private investment, create jobs, and boost wages. We have to adjust course, because if nothing is done, the first to pay the price of inaction on taxes will be Canadian workers," concludes Michel Kelly-Gagnon, President and CEO of the MEI.

* * *

The MEI is an independent public policy think tank. Through its publications and media appearances, the MEI stimulates debate on public policies in Quebec and across Canada by proposing reforms based on market principles and entrepreneurship.

 

SOURCE Montreal Economic Institute


These press releases may also interest you

at 12:05
T-Mobile US, Inc. looks forward to discussing first quarter 2024 financial and operational results on Thursday, April 25, 2024, at 4:30 p.m. Eastern Time (EDT). The call will be accessible via dial-in with pre-registration as well as a webcast link...

at 12:05
Float, the marketplace moving all the care that doesn't need a hospital to the home, today announced $10 million in Series A funding led by Canvas Ventures, whose General Partner Mike Ghaffary has joined Float's board, with participation from Wave...

at 12:00
Helika, a leading global infrastructure provider for traditional and Web3 gaming, launches Helika Accelerate, an accelerator program dedicated to supporting top gaming studios around the globe to develop Web3 games and to sustain growth in users and...

at 12:00
The Russell Innovation Center for Entrepreneurs (RICE), the largest center in the world dedicated to growing, scaling, and developing Black entrepreneurs proudly announces the strategic enhancement of its leadership team with two distinguished...

at 12:00
Kidsy, a disruptor in online retail, has raised over $1M to provide consumers greater access to discounted baby and kids products. The pre-seed round, which was oversubscribed, is the company's first round of funding...

at 12:00
Today, the Women's Suffrage National Monument Foundation welcomed 35 organizations committed to uplifting American women's history and empowering women and girls as the Foundation's founding cohort of National Partners. Together, the Foundation and...



News published on and distributed by: