Ottawa will reportedly announce plans today to cut the small business tax rate from 10.5% to 9% on Monday, as it attempts to quell a backlash to proposed tax reforms that have stung the Trudeau government.
Finance Minister Bill Morneau's reputed move to reduce the tax rate paid by small businesses is aimed at deflecting criticism of proposed tax reforms that have angered small business owners, who said the changes would hurt the same middle-class Canadians the government is purporting to help. Some premiers and Liberal backbenchers also objected to the reforms.
Morneau will also announce changes to the package of tax reforms he first announced this summer. The Liberal government will unveil the tweaks throughout the week.
All three major parties pledged to cut the tax rate in the run-up to the last election, and the previous Conservative government had begun cutting it in its last budget.
The Liberals froze the rate at 10.5% until they could close loopholes that they said allowed the wealthy to use incorporation as a small business to unfairly reduce their income tax burden.
