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Ottawa, April 27, 2005
2005-031

Government to Proceed With Budget 2005 Corporate Tax Reduction Measures

Minister of Finance Ralph Goodale stated today that the Government intends to proceed with plans to implement the corporate tax reduction measures outlined in Budget 2005.

The Minister explained that these measures include reducing the general corporate income tax rate, eliminating the corporate surtax, and improving the alignment of capital cost allowance (CCA) rates with the useful life of assets.

Mr. Goodale said that the Government will propose amendments to the Budget Implementation Act, Bill C-43, to eliminate the surtax for small and medium-sized businesses only and to remove the reduction to the general corporate tax rate proposed in Budget 2005. The Government will bring forward separate legislation at the earliest opportunity to reintroduce those measures eliminated from Bill C-43, including extending the surtax elimination to all corporations and reducing the general corporate income tax rate. CCA rates announced in Budget 2005 will be implemented without delay through regulatory changes.

"I want to make it clear that our tax measures, just like our other budget measures, will be implemented in a fiscally responsible manner," Minister Goodale said. "We will post balanced budgets or better in each of the next two years, and our plan to reduce Canada’s debt-to-GDP (gross domestic product) ratio to 25 per cent by 2014–15 remains on track."

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