TORONTO, March 21, 2013 /CNW/ - The Canadian Institute of Chartered Accountants (CICA)* gives the federal government a B Plus rating for a budget that focuses on balancing the books while providing targeted funding to spark economic activity.
The government is committed to returning to balanced budgets by 2015-16.
"With lingering economic uncertainty, the government's focus remains a multi-year incremental approach to balancing its books that allows for the funding of initiatives aimed at creating jobs and economic growth," explains Gabe Hayos, vice-president, taxation, with the CICA. "However, it is essential that the government stays on course and gets its finances in order if Canada is to achieve a sustainable recovery."
The budget outlines a fiscal framework that features a skills training initiative, infrastructure funding and new investments to support manufacturing and innovation in Canada.
There are no significant personal or corporate tax increases but the government is taking action to preserve its tax base. The budget looks to close tax loopholes, address aggressive tax planning, clarify tax rules, reduce international tax avoidance and tax evasion and improve tax fairness. It also provides the Canada Revenue Agency with new tools to enforce the tax rules.
"We support efforts to maintain the integrity of the tax base, but the CICA will work closely with Finance and the CRA to ensure that casting such a broad net of actions does not result in unintended consequences," says Hayos.
The CICA would have preferred to see more action to reduce the complexity of Canada's tax system, making the country more attractive for investment.
The Institute welcomes greater disclosure requirements for scientific research and experimental development claims without further restricting contingency fee arrangements relating to the tax incentive program. "This is something we recommended," stresses Hayos. "The ability to engage third-party preparers on a contingency fee basis often allows companies to increase innovation spending."
Other measures being applauded include the government continuing to work with the provinces, territories and stakeholders to improve the foreign credential recognition processes along with plans to improve financial literacy among seniors.
The CICA believes that helping Canadians develop financial knowledge is critical to the country's ongoing economic strength and prosperity. "It is important for Canadians to gain the financial skills, knowledge and confidence required to make the best choices for their circumstances," adds Hayos.
Note: The CICA will have a more detailed analysis of the federal budget on its website later this evening (www.cica.ca).
* CICA and CMA Canada joined together January 1, 2013, to create CPA Canada as the national organization to support unification of the Canadian accounting profession under the CPA banner.
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 83,000 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).
About CPA Canada
CPA Canada is the national organization representing the Chartered Professional Accountant (CPA) profession in Canada. The Canadian Institute of Chartered Accountants (CICA) and The Society of Management Accountants of Canada (CMA Canada) created the organization on January 1, 2013, to support unification of the Canadian accounting profession under the CPA banner. CPAs will serve the public interest across all sectors of the economy with integrity, sound ethical practices, disciplined regulation and proven strategic management and financial expertise. Accounting bodies representing over 80 per cent of Canada's professional accountants are committed to unification or have already merged under the CPA banner.
SOURCE Canadian Institute of Chartered Accountants