(September 29 – 12:45 ET) – The Canadian Institute of Chartered Accountants is calling on Finance Minister Paul Martin to accelerate tax cuts for Canadians, and to fast-track debt reduction in the next federal budget.

In its annual pre-budget submission to Paul Martin, the CICA recommends that $6 billion be spent over three years to accelerate personal income tax cuts announced in the 2000 budget. Specifically, CICA recommends that $600 million be spent in the current fiscal year, $2.4 billion in 2001/2002 and $2.9 billion in 2002/2003.

It also recommends that the government allocate $5 billion towards debt reduction in both the 2001/2002 and 2002/2003 fiscal years. Under this scenario, and with a similar payment this fiscal year, the debt-to-GDP ratio would fall from an estimated level of 59.4% in 1999/2000, to 52% in 2001/2002 and to 49.5% by 2002/2003. Meeting these targets would bring Canada more in line with the G7 average which stood at 45.8% in 1999.

CICA supports increased program spending in priority areas such as health care, and recommends that $2.6 billion of the surplus for fiscal year 2001/2002 be allocated for limited spending increases for existing programs.

“With the Canadian economy firing on all cylinders and the likelihood of at least a $ 10 billion surplus, it is only right that average Canadians see some accelerated tax relief,” said Bob Lord, FCA, chair of the CICA Board of Directors. “At the same time, we strongly believe it is important to take action now to reduce the debt in order to free up resources that are currently devoted to servicing the nation’s debt. Canadians end up winning on both fronts.”

Details on these recommendations are outlined in the CICA’s 2000 Pre-Budget Submission: The CICA’s Views Regarding the 2001 Federal Budget. Follow the link at bottom of this story.
-IE Staff