The Investment Industry Association of Canada (IIAC) is applauding the federal government for taking steps in the 2013 budget to improve the competitiveness and efficiency of the tax system, strengthen the integrity of capital markets and soundness of the financial system, and obtain better access to global markets.
The IIAC says the latest federal budget builds incrementally on measures introduced in the past seven budgets.
In particular, the association notes that the federal government has underscored its strong support for a national securities regulator to strengthen the regulatory framework of the Canadian capital markets. The government has announced plans to extend the mandate of the Canadian Securities Transition Office, and is committed to introducing legislation to carry out its regulatory responsibilities, if timely agreement with the provinces on the common regulator cannot be reached.
“We are pleased the government has taken this decisive action,” said Ian Russell, president and CEO of the IIAC. “In an era of global regulatory reform, our country needs a strong national voice to ensure the interests of Canadian market participants are properly heard.”
The IIAC also commends the government for taking steps to help small businesses access risk capital and expertise, including $400 million already earmarked for the Venture Capital Action Plan, an increase to the Lifetime Capital Gains exemption for small businesses, intended changes to the Immigrant Investor Program, and a phase-out of the federal tax credit for Labour Sponsored Venture Capital Corporations.
The association expressed disappointment, however, at the exclusion of a more broadly based incentive for small business capital-raising.
Meanwhile, the IIAC says it is pleased to see that public finances remain “firmly under control”. It notes that this year’s budget deficit of $25.9 billion is poised to move to balance within three years, and public debt as a share of GDP is set to fall below 30% in four years.
“Strong finances and competitive tax rates have been achieved over a period of difficult economic conditions at home and abroad. Canada is well positioned to further strengthen its competitive position, and improve the welfare of all Canadians, as the global recovery gathers momentum,” said Russell.