KPMG sheds light on budget day impacts
TORONTO/OTTAWA, March 21, 2013 /CNW/ - In an effort to balance the books
by 2015, today's federal budget focused mostly on jobs, the economy and
closing "tax loopholes".
"The theme for today's budget was jobs, growth and long-term
prosperity," says Elio Luongo, Canadian Managing Partner, Tax with KPMG in Canada. "The focus on jobs
and growth is a continuation of a theme to try and manage current
issues including bridging the skills gap in Canada while balancing the
budget by 2015. The government has introduced a number of measures to
help finance this with a focus on tax integrity and closing 'tax
loopholes'. Areas as diverse as tax loss trading, life insurance
products, the mining industry and labour sponsored venture incentives
KPMG on The Hill
Budget 2013 highlights include:
Personal tax changes
The federal effective tax rate on non-eligible dividends will increase
to 21.22% (from 19.58%).
The lifetime capital gains exemption is increased to $800,000 (from
$750,000) on dispositions of qualified property (e.g., qualified small
business corporation shares and qualified farm and qualified fishing
property) by individuals effective for the 2014 taxation year.
Introduction of a temporary first-time charitable donor's super credit.
A first-time donor will be entitled to a 40% federal credit for
donations of $200 or less, and a 54% federal credit for the portion of
donations over $200 but not exceeding $1,000. Only donations of money
will qualify for this credit and it can only be claimed once.
Business tax changes
Proposes to extend for one year the temporary Hiring Credit for Small
Proposes additional federal support for business innovation, continuing
to respond to the Expert Review Panel on Research and Development, the Jenkins Panel, in October 2011.
International tax changes
Proposes a series of measures to extend the thin capitalization rules to
alternative investment structures for investing in Canada.
Proposes measures to better align the deductions available for expenses
in the mining sector with those available in the oil and gas sector.
The budget proposes two measures to simplify employer compliance with
the GST/HST rules affecting employers that participate in a registered
The KPMG Perspective
KPMG LLP, an Audit, Tax and Advisory firm (kpmg.ca) and a Canadian
limited liability partnership established under the laws of Ontario, is
the Canadian member firm of KPMG International Cooperative ("KPMG
International"). KPMG member firms around the world have 152,000
professionals, in 156 countries.
The independent member firms of the KPMG network are affiliated with
KPMG International, a Swiss entity. Each KPMG firm is a legally
distinct and separate entity, and describes itself as such.
SOURCE: KPMG LLP
For further information:
KPMG in Canada
KPMG in Canada