TORONTO, March 29, 2012 /CNW/ - The Canadian Institute of Chartered Accountants (CICA) gives the federal budget a B Plus rating, saying it positions Canada well for the future while providing prudent fiscal management.
"Budget measures being introduced are designed to serve the short-term while maintaining a vision that embraces the long-term," said Kevin Dancey, FCA, president and CEO, CICA. "It is encouraging to see the government bringing the books back into balance through expenditure controls rather than tax increases or provincial off-loading."
CICA, which represents Canada's CAs, applauded the federal government's commitment to deficit reduction. Based on budget document estimates, the federal government deficit is projected to decline to $1.3 billion by 2014-2015. A surplus is anticipated the following year.
"We are supportive of any actions taken to put long-term budgetary expenditures within a sound fiscal framework," noted Dancey. This includes the budget's plan to protect Old Age Security (OAS), which is financed from general government revenues. To do this:
- The government will gradually increase the age of eligibility for OAS from 65 to 67 years of age. The change will start in April 2023, with full implementation by January 2029 and will not affect anyone who is 54 years of age or older as of March 31, 2012.
- Beginning in 2013, Canadians will be given the option of deferring take-up of the OAS benefits to a later time and subsequently receive higher annual benefits.
Other measures supported by CICA include the government's commitment to:
- Bringing public service and MP pension plans more in line with those in the private sector, which will reduce expenditures.
- Reducing the red tape burden on businesses.
- The government's intention to support further improvements to foreign credential recognition.
While there are no tax increases in the budget, CICA was looking for a stronger indication the government is serious about addressing the complexity of the country's tax system and its undue reliance on personal taxes.
"The CICA believes tax complexity is an issue that must be addressed if Canada is going to establish a competitive environment that sets the stage for sustainable recovery and economic growth," stressed Gabe Hayos, FCA, vice-president, CICA. "Canada's tax system must become more competitive, simpler and efficient."
While the budget outlines a number of changes in to support innovation in Canada, CICA expressed disappointment in relation to elements outlined for the Scientific Research and Experimental Development tax credit.
"We were hoping to see the Scientific Research and Experimental Development tax credit become partially refundable for all businesses," said Dancey. Instead, the program will involve more direct government funding. "We challenge the notion that government officials are better able to allocate funds to innovation than those on the front lines."
A more detailed analysis of the government's economic action plan is available in the CICA's Budget Brief
Chartered Accountants (CAs) are Canada's most valued, internationally recognized profession of leaders in senior management, advisory, financial, tax and assurance roles. Through their integrity, expertise, and internationally recognized qualification standards, Canada's 80,000 CAs sustain their influence and leadership position both in Canada and globally. As trusted business advisors to Canadian organizations of all sizes, Canada's CAs foster confidence in Canadian business and contribute to the health and sustainability of Canada's capital markets and economy. The Canadian Institute of Chartered Accountants (CICA) represents Canada's CA profession both nationally and internationally. The CICA is a founding member of the International Federation of Accountants (IFAC) and the Global Accounting Alliance (GAA).
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