A pre-budget submission published last week by Canadian Manufacturers and Exporters (CME) makes recommendations to increase Canada’s tax competitiveness to spur global investment. Their recommendations can be summarized as follows:
1. PRODUCTIVITY
– Make the Accelerated Capital Cost Allowance (ACCA), or the 2-year write-off for equipment and machinery, permanent. This will help drive business investment in equipment and machinery, which are important drivers of productivity.
– Implement refundable SR&ED tax credits to provide more focused support to private sector R&D, and expand the ACCA to include machinery and equipment used for R&D purposes.
– Study the possibility of a separate tax credit for the acquisition of equipment and machinery.
– Increase direct support for R&D through a refundable SR&ED tax credit for large corporations.
2. LABOUR
– Eliminate labour shortages through the elimination of barriers to the movement of skilled labour between provinces through provincial regulatory bodies.
– Support workplace training by providing a tax training credit for employers.
– Increase the availability of labour for industry through labour market inclusion strategies, and streamline the regulatory processes for companies to bring in foreign workers when needed.