October 16, 2017 – Markham, Ontario – Department of Finance Canada
When you have an economy that works for the middle class, you have a country that works for everyone. The Government of Canada has already taken the first steps by lowering taxes for middle class Canadians, and is committed to ensuring that unintended advantages are not being used by high-income and wealthy individuals to pay less than their fair share in taxes.
Prime Minister Justin Trudeau, Finance Minister Bill Morneau and Small Business and Tourism Minister Bardish Chagger today announced that, as it has committed, the Government intends to lower the small business tax rate to 10 per cent, effective January 1, 2018, and to 9 per cent, effective January 1, 2019. To support this change, the Government will take steps to ensure that Canadian-controlled private corporation (CCPC) status is not used to reduce personal income tax obligations for high-income earners rather than supporting small businesses.
Based on what it heard from Canadians in a series of country-wide consultations on tax planning using private corporations, the Government will this week set out its approach to better target strategies used by the relatively small number of high-income individuals who get the biggest advantage from existing tax rules.
Ministers Chagger and Morneau today announced the Government’s intention to simplify the proposal to limit the ability of owners of private corporations to lower their personal income taxes by sprinkling their income to family members who do not contribute to the business. The vast majority of private corporations will not be impacted by the proposed income sprinkling measures. Corporations with family members who meaningfully contribute to the business will not be impacted by the proposed measures on income sprinkling. In addition, the Government today announced it will not be moving forward with proposed measures to limit access to the Lifetime Capital Gains Exemption.
Comments are closed.