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Ottawa, December 13, 2003
2003-063

Minister of Finance Rejects NDP’s Suggestion to Cancel Tax Cuts

Ralph Goodale, Minister of Finance, today rejected New Democratic Party Leader Jack Layton’s call to roll back corporate tax reductions scheduled for January 1, 2004, saying that the Government’s tax reduction plan has produced significant economic and social benefits for all Canadians.

Minister Goodale pointed out that most of the $4.4 billion referred to by Mr. Layton represents tax reductions that, in fact, have already been phased in—starting in 2001, when the 28-per-cent general corporate tax rate was reduced by 1 percentage point.

The annual cost of reducing the general corporate tax rate to 21 per cent from 23 per cent on January 1, 2004, will be $1.1 billion, not $4.4 billion as alleged by Mr. Layton.

"Canadians deserve the facts," said Minister Goodale. "Mr. Layton’s numbers are simply wrong, and he is trying to obscure the true benefits of tax cuts—namely jobs and economic growth."

In fact, according to private sector forecasts, increased economic growth will boost federal corporate tax revenues by more than $1 billion in the coming year.

The Minister also noted that personal income tax reductions—especially for low- and middle-income families with children—accounted for 75 per cent of the Government’s $100-billion Five-Year Tax Reduction Plan.

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