Tax reforms a necessity for manufacturing growth in Canada, CME says
August 23, 2012 by Manufacturing AUTOMATION
Canada must improve its tax competitiveness to spur investment, address ongoing labour market challenges, and fuel economic growth, according to Canadian Manufacturers & Exporters (CME).
The CME issued a report that makes several recommendations to the federal government in advance of its 2013 budget, which include strengthening support for the Scientific Research & Experimental Development (SR&ED) tax credit, and adopting the Accelerated Capital Cost Allowance – also known as the two-year write-off for machinery and equipment – as a permanent part of the tax system.
“While the government has implemented a number of important tax measures in recent years, there is much progress to be made to ensure Canada is one of the most competitive tax jurisdictions in the world for companies to invest and grow,” CME president and CEO Jayson Myers said in a statement.
“For example, changes to the SR&ED program announced in the 2012 federal budget are a step in the wrong direction; and we are hopeful the government will review their negative impact on innovation performance, and industry as a whole.”
The need for a higher-quality skilled workforce is another area of significant importance for manufacturers and exporters addressed in the submission. Growing labour shortages in specific sub-sectors of Canadian manufacturing require incentives for on-site training, and facilitating the hiring of workers from other jurisdictions.
“The government should further support workplace training by providing an employers’ training tax credit, and streamline the regulatory processes for companies to bring in foreign workers when needed,” notes Myers. “While the procurement of new machinery and development of new markets are critical to business expansion, companies, essentially, require qualified labour to sustain business growth,” he added.
To view all the recommendations included, read CME’s complete pre-budget submission here.