The Certified General Accountants Association of Canada (CGA-Canada) today called on the House of Commons Standing Committee on Finance to undertake a major study of how Canada's tax system can be made fairer, simpler and more responsive, both for businesses and individuals. Appearing before the Committee in the context of its pre-budget consultations, CGA-Canada outlined for Members the three objectives that should guide tax reform:
- effective tax rates for businesses that are more competitive with the US and other G-7 countries;
- a more balanced taxation structure in respect of consumption vs. income taxes; and
- lower personal income tax rates.
Everett E. Colby, FCGA, Chair of CGA-Canada's Tax and Fiscal Policy Committee, explained that these changes were necessary if Canada was to improve its productivity and thereby maintain a relatively high standard of living. "We have an opportunity in the next few years to get our fiscal house in order, before the baby boomers retire," said Mr. Colby. "The Government has taken a number of positive steps in the last few years, but it is time for a structural review of the tax system," he concluded.
In addition, CGA-Canada cautioned that continuing the current trend in expenditure increases might jeopardize future balanced budgets. "We are encouraged with the $1 billion commitment made in last year's budget to reallocate program spending but government must keep their spending in check. Controlling expenditure growth is vital in these uncertain times," said John Nagy, FCGA, Chair and Chief Executive Officer, CGA-Canada.
Accompanying these proposals, CGA-Canada also called on the Government to establish a medium-term debt reduction target of a debt-to-GDP ratio of 30% by the year 2010 and to make the Employment Insurance regime fairer to entrepreneurs.
CGA-Canada is a professional accounting body, representing 58,000 Certified General Accountants and students in Canada and abroad. The Association sets professional standards, develops education programs, publishes professional materials and develops national policy.
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