OTTAWA, March 22, 2017 /CNW/ - Today's federal fiscal blueprint charts a course for economic renewal but fails to identify an important destination by not outlining when the government plans to return to balanced budgets, according to Chartered Professional Accountants of Canada (CPA Canada).
The budget deficit is expected to hit a high of $28.5 billion in fiscal 2017-2018 and eventually decline to $18.8 billion in fiscal 2021-2022.
"This latest budget raises concerns because there is no timeline to address these persistent deficits," stresses Joy Thomas, president and CEO, CPA Canada. "Establishing a target date to bring the budget back into balance would create a goalpost to guide the government in its financial planning. This would greatly assist in fostering business confidence, supporting essential programs and minimizing the burden on future generations."
CPA Canada recognizes that for the economy and Canadians to truly prosper strong fiscal management is only part of the equation. It must come in conjunction with measures aimed at helping individuals, families and businesses succeed, achieve and prosper. The new budget outlines extensive long-term investments in skills training, innovation and infrastructure funding, including a focus on lifelong learning, youth employment, and measures to support innovation.
"We support the government's focus to address how Canadians are being impacted by broad economic forces, including technological change and automation," says Thomas. "Canada's future prosperity will be directly linked to the competitiveness of its workforce."
In addition, the budget builds on earlier announced efforts to combat tax evasion and to improve compliance. An additional $523.9 million is being invested over five years to fund new initiatives and to extend existing programs. The anticipated revenue from Budget 2017 measures that crack down on tax evasion is $2.5 billion over five years, resulting in an estimated return on investment of five to one.
The Government also is reiterating its commitment to work with international partners to ensure a coherent and consistent response to fight tax evasion.
"CPA Canada is dedicated to supporting the government in implementing measures for a globally equitable, consistent and modern international tax system," explains Thomas. "The government's commitment to strengthening compliance reinforces Canada's determination to protect the public interest."
The budget notes that the federal government will work with the provinces to implement strong standards for corporate and beneficial ownership transparency to provide safeguards against money laundering, terrorist financing, tax evasion and tax avoidance.
The government's review of tax expenditures found a few tax measures that could be eliminated because they are inefficient or no longer relevant – though there was an indication of further review in the future. However, CPA Canada firmly believes a more comprehensive review of the entire system is required.
"We have consistently called for a broad-based approach to be applied when looking at making changes to the tax system," says Thomas. "An extensive review can identify areas that will assist in recalibrating the tax system so that it not only enhances efficiencies and fairness for Canadians and the business community but also plays a role in cultivating long-term, sustainable economic and social growth."
Successful Canadian businesses must always navigate change. With the current economic uncertainty south of the border, CPA Canada is encouraging the Canadian government not to become paralyzed in its decision making and to continue to focus on strategies and measures that ensure Canada remains competitive and is able to attract and retain top talent.
One final note, it is the end of an era. The Canada Savings Bonds Program, created in 1946, is being phased out as it is no longer a cost-effective source of funds for the federal government.
CPA Canada's more detailed federal budget analysis will be available tonight at cpacanada.ca/budget2017
About CPA Canada
The new Canadian designation, Chartered Professional Accountant (CPA), is now used by Canada's accounting profession across the country. The profession's national body, Chartered Professional Accountants of Canada (CPA Canada), is one of the largest in the world with more than 200,000 members, both at home and abroad. The Canadian CPA was created with the unification of three legacy accounting designations (CA, CGA and CMA). CPAs are valued for their financial and tax expertise, strategic thinking, business insight, management skills and leadership. CPA Canada conducts research into current and emerging business issues and supports the setting of accounting, auditing and assurance standards for business, not-for-profit organizations and government. CPA Canada also issues guidance and thought leadership on a variety of technical matters, publishes professional literature and develops education and professional certification programs. cpacanada.ca
SOURCE CPA Canada
For further information: Tobin Lambie, Principal, Media, CPA Canada, Telephone: 416-204-3228, Mobile: 647-302-3761, [email protected]