The Government of Canada has reduced the corporate income tax rate for 2011 and 2012, according to Minister of Finance Jim Flaherty.
On Jan. 1, 2011, the federal general corporate income tax rate was reduced to 16.5 per cent from 18 per cent, in advance of the final legislated reduction to 15 per cent effective Jan. 1, 2012. This reduction will lead to further improvements in Canada’s competitiveness and productivity and ultimately higher standards of living for Canadians, the government said in a release.
“The economy remains our Government’s number one priority,” said Minister Flaherty. “If we want more jobs, higher wages and an improved standard of living, Canada needs to be the most attractive place for job creators to do business and invest.”
Canada has an overall tax rate on new business investment that is substantially lower than that in any other G7 country.
Low taxes encouraging businesses to invest more in the Canadian economy, which stimulates job creation and economic growth, said Flaherty.
Many provinces and territories have also lowered taxes on job creators, he said.