Corporate income taxes - The Conseil du patronat du Québec recommends a 10/10 plan to put Quebec and Canada at the forefront of competitive economies

    MONTREAL, Feb. 7 /CNW Telbec/ - At pre-budget provincial consultations
today, the president of the Conseil du patronat du Québec (CPQ), Michel
Kelly-Gagnon, will present the Quebec Finance Minister with a corporate income
tax reduction plan that would strengthen the Quebec and Canadian economies.
    Applicable across Canada, the CPQ's 10/10 Plan would have all provinces,
including Quebec, lower their corporate income tax rates to 10%, which
currently range from 10% to 16%. This is not a new proposal, since it repeats
the request made to provinces last fall by the federal Finance Minister. The
reduction would not be difficult for Quebec, since the current rate is 11.4%
and was 8.9% three years ago.
    The newer, more ambitious aspect of this plan is the CPQ's request that
the federal government do the same: to lower its corporate income tax rate
from the current 19.5% to 10%. Finance Minister Flaherty already announced a
reduction to 15% for 2012-2013. The overall goal would be to achieve a
combined rate of 20% - a target attainable within the same timeframe as the
existing federal reduction plan, according to the CPQ.
    "This plan would make our corporate tax environment one of the most
competitive in the world," said Mr. Kelly-Gagnon. "It would send a strong
signal that Quebec and Canada are the best places to invest among major
economies, while remaining competitive with the most dynamic small economies."
    In concrete terms, the CPQ president recommends that Quebec act in
two phases. At the next budget, the Finance Minister could cancel the tax rate
hike to 11.9% planned for 2009, and maintain it at its current level. At the
next budget, he could then announce its reduction to 10% beginning in 2010.
The cost of this measure to the Quebec government would be about $100 million
in 2009 and $300 million in 2010.

    Other fiscal proposals

    The CPQ also encourages the Finance Minister to consider accelerating the
elimination of the capital tax, planned for 2011, given the current poor
economic forecasts.
    "In a slowing economic environment, the government should consider the
possibility of abolishing the capital tax by 2009," said the CPQ president.
"This measure would encourage businesses to launch their investment projects
earlier, and therefore stimulate the economy in its time of need."
    Finally, last year the CPQ applauded the increase in deduction rates for
depreciation, which rose to 50% (for depreciation over two years) for machines
and equipment purchased between March 2007 and 2009. The CPQ believes Quebec
could further stimulate private investment by making this rate permanent in
the next budget.

    The Conseil du patronat du Québec is the main federation of employers in
Quebec. The organization includes many of the province's largest companies as
well as the vast majority of sector-based employers' associations.

For further information:

For further information: Patrick Leblanc, Director of Communications,
Conseil du patronat du Québec, (514) 288-5161, ext. 226, Cell.: (514)

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890