http://www.bloomberg.com/news/2011-01-12/canada-tax-cuts-will-add-jobs-grow-revenue-manufacturers-say.htmlSummary
Summary
Canada's manufacturing lobby group had announced that Prime Minister Stephen Harper is planning to reduce corporate tax rates over the next two years. This act is expected to provide more job employment, boost investment and help raise government revenue.The Conservative government's decision to cut the federal rate to 16.5%, which is a cut down by 1.5%. The government believed that it will generate 49,900 net jobs and add C$25.8 billion to the economy over two years. The report by the Canadian Manufacturers and Exporters estimated that the reductions would cost the federal government C$6.2 billion; however, it will generate as much as C$9.9 billion in additional revenue for provincial and federal government. Jayson Myers, chief executive of the manufacturers' group, stated that corporate tax cuts are critical drivers of the Canadian economy and the reductions are necessary to bring corporate taxes into line with other industrial economies.
Connection
The corporate tax is a kind of direct tax, which is a tax imposed on the person who is intended to pay the tax. Corporation tax provides a hugh amount of money to the the revenue of the government every year. Just like what the Canada's manufacturing lobby group stated, the cutting of the corporate tax will bring more reveune, employment, and investment to the country; these increased factors would affect the GDP(Gross Domestic product) of Canada. More people are employed means that more people would purchase goods and pay the taxes. In the long run, the reduction of the corporate tax would increase the GDP of Canada.
Reflection
In my opinion, i think cutting corporate tax is a good way to help Canada to walk out of the recession. One of the most serious issue during the recession is the unemployment. By cutting the corporate tax, there will be more employment positions for the Canadians. And these Canadians will have the ability to purchase more goods which can push the Canadian economy.When i saw the title about Canada cutting tax, I thought that the government would lost revenue because the taxes are cut. Instead, it can bring more revenue to the government. And I think that's a really smart decision by the government.
I agree with what wilson thinks about the government's decision to cut down taxes which as a result helps the growth of revenue and more jobs. This article is actually quite similiar to mine, it is written also about the reduction of federal rate from 18% to 16.5% which is down by 1.5%. This will allow more job opportunities, boost investment and improve living standards. This will also mean people will have more money to buy goods and services which will also help the growth of the Canadian economy. It is a good change because while it is benefiting to people like my parents, teachers, and other people it is also benefiting to the Canadian economy. Like Wilson's summmary says, "bring corporate taxes into line with other industrial economies.
ReplyDelete- Cathy Tran