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Remarks delivered by Brian Kingston, Vice President, International and Fiscal Issues
Mr. Chair, committee members, thank you for the invitation to take part in your pre-budget consultations.
The Business Council of Canada represents the chief executives and entrepreneurs of 150 leading Canadian companies, in all sectors and regions of the country. Our member companies employ 1.7 million Canadians, account for more than half the value of the Toronto Stock Exchange, contribute the largest share of federal corporate taxes, and are responsible for most of Canada’s exports, corporate philanthropy, and private-sector investments in research and development.
In the Council’s pre-budget submission to this committee we urged the government to boost Canadian productivity by increasing female labour force participation, supporting women in STEM, enabling seniors to work for longer and helping Canadians navigate the changing job market. While no single policy or program would boost labour productivity across the board, I will highlight two specific policies:
In our submission we also called on the government to adopt a competitiveness agenda that includes simplifying the tax system and streamlining the regulatory environment. Doing so would position Canada as a more attractive investment destination.
On that point, I would like to share with you the results of a survey we conducted over the summer of our member companies. Sixty-one of Canada’s largest companies took part in the survey. Almost two-thirds – 64 per cent – said that Canada’s investment environment has worsened over the past five years. Only 20 per cent said the investment environment has improved.
To reverse this worrying trend and improve business confidence we recommend the following:
Mr. Chair, committee members, I know that earlier today you held hearings on the government’s plan to rewrite the tax rules for private corporations. Our President and CEO, The Honourable John Manley, will be submitting our views to Minister Morneau later this week, but one thing is sure: the proposals would do nothing to help Canada’s tax competitiveness. In fact, they risk driving investors and entrepreneurs away.
Rather than making incremental changes to an already complicated tax system, now is the time for comprehensive review aimed at strengthening fairness and efficiency. In our view, the best way to achieve both objectives is to broaden the tax base and lower rates. Of equal importance is the need to ensure that the tax system does not favour certain kinds of businesses over others.
Thank you for the opportunity to address your Committee. I would be happy to answer any questions.