KPMG calls for focus on Canadian competitiveness and innovation, in addition to measures to help individual Canadians succeed
The federal government needs to focus on enhancing Canadian competitiveness by supporting business growth and innovation in the upcoming federal budget, says KPMG in Canada.
"U.S. tax reform and market and technological shifts are having an impact on the health of our economy and Canada's global competitiveness," says Greg Wiebe, Canadian Managing Partner, Tax at KPMG. "While the federal government announced certain tax changes in the Fall Economic Update, we hope to see further measures in this budget to help Canadian companies compete, grow and innovate for the future. Keeping Canada competitive on a tax basis and an attractive place to do business are key priorities for industry. In an election year budget, beneficial personal tax measures that help Canadians succeed and prosper would also be welcome news."
Actions the federal government could take in the upcoming federal budget include:
Business Tax Changes –This year's budget could introduce tax credits and programs that respond to U.S. tax reform, drive business innovation and support research and development (R&D) activities in Canada. In addition, measures related to investments in technologies that reduce carbon emissions may be considered.
Skills Training – The federal government may be considering tax credits for new skills training, as well as possible funding to enable workers to upgrade their skills to meet digital shifts in the job market.
Intellectual Property and Commercialization – Consistent with this government's innovation agenda, the budget may establish incentives for intellectual property development and commercialization. This may involve an innovation tax incentive for business revenue derived from commercializing Canadian-issued intellectual property rights.
Subsidizing First Patents – The budget may also feature a new program to subsidize expenses incurred by small- and medium-sized businesses in obtaining a first patent. This program may be similar to a recent program launched in Quebec to promote innovation in the manufacturing sector, which encourages companies to develop the results of R&D work that lead to the granting of a patent.
Other potential budget measures include:
International Tax – The federal government could introduce tax tightening measures which the OECD had recommended to combat base erosion and profit shifting (BEPS) by multinational companies. Similar legislative changes have been made by other countries around the world.
Personal Tax Changes – Personal tax measures may be introduced in the budget, including new rules or enhanced tax credits for middle income families with children and seniors. To keep homeownership within the reach of more Canadians, changes to the Home Buyer's Plan and other policy measures may also be planned.
KPMG's professionals are available to provide insight and commentary on the impact of the 2019 budget on businesses in Canada. A listing of our national spokespersons is provided below. With locations across Canada, our regional business unit leaders are also available to comment on the budget's implications for their areas
|National Spokespeople||Budget Topics|
|Greg Wiebe, Canadian Managing Partner, Tax||Corporate Tax Overview for Canada|
|Joy Nott, Partner, Trade and Customs||Business and Trade in an Election Year|
|Armughan Ahmad, President & Managing Partner, KPMG Digital and Technology Solutions||Innovation and Canada's Digital Economy|
|Carmela Pallotto, Partner, Tax||Banking Sector|
|Penny Woolford, Partner, National Leader, International Corporate Tax||International Corporate Tax|
|David Regan, Partner-in-Charge, R&D Tax Incentives Practice||Tax Incentives for Business|
|Dino Infanti, Partner, National Leader, Enterprise Tax||Private Company and Personal Taxation|
Walter Sisti, Partner, National Leader, Indirect
|Blaine Cameron, Partner, Business Unit Leader, Regions East Tax||Eastern Canada|
|Pascal Martel, Partner, Business Unit Leader, Quebec Tax||Quebec|
|Lucia Iacovelli, Partner, Business Unit Leader, GTA Tax||Greater Toronto Area|
|Curtis Lester, Partner, Business Unit Leader, Calgary Tax||Alberta|
|Deborah MacPherson, Partner, Business Unit Leader, Regions West Tax||Western Canada|
|Jodi Kelleher, Business Unit Leader, GVA Tax||Greater Vancouver Area|
Learn more from our professionals about what could be in store for business and Canadians on KPMG's federal budget homepage.
KPMG will be hosting its Federal Budget 2019 webcast on March 19, 2019 at 5pm EDT, right after the budget is tabled. Budget highlights will also be available late in the afternoon on budget day at kpmg.ca.
About KPMG in Canada
KPMG LLP, an Audit, Tax and Advisory firm (kpmg.ca) and a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm of KPMG International Cooperative ("KPMG International"). KPMG member firms around the world have 207,000 professionals, in 153 countries and territories. The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity, and describes itself as such.
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