Are you a small business residing in Canada? If so, good news: Prime Minster Stephen Harper has recently announced that the Government is lending a helping hand, so to speak. Specifically, taxes will be reduced for those who are running a small business.
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Harper has much support with his decision. Particularly, support comes from the following: Minister of State Candice Bergen and Member of Parliament for Elmwood-Transcona Lawrence Toet.
The plan shows that the federal small business tax rate will be reduced to nine percent by 2019. The first reduction will take place in 2016. In total, this reduced rate should assist about 700,000 small businesses annually from coast to coast in Canada. This change will ultimately help with job creation and economic growth.
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These reductions, which were originally a part of the Economic Action Plan in 2015, will be happening due to the balancing of the budget. Other actions have been taken to assist small business, too. These various actions include reducing red tape, improving access to financing, introducing the Small Business Job Credit to provide relief to small businesses and increasing the Lifetime Capital Gains Exemption.
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Various facts regarding small business and the reduction
Interestingly enough, the Government has been taking action to better assist small businesses since 2006. Specifically, the 2015 plan mentioned above shows that the tax rate will be reduced to 10.5 percent in 2016, followed by 10 percent in 2017, nine point five percent in 2018 and finally, nine percent in 2019.
Once the reduction is all said and done, federal taxes for small businesses and their owners will be reduced by $2.7 billion over the 2015-2016 to 2019-2020 period.