The Government of Canada will be ringing in the New Year with another tax cut.
We are reducing the goods and services tax (GST) rate to five per cent from six, beginning on January 1, 2008.
In New Brunswick, Nova Scotia and Newfoundland and Labrador, we’ve once again reduced the federal portion of the harmonized sales tax (HST) by one percentage point, lowering the rate to 13 per cent.
This is the second GST/HST cut in less than two years. Our Government is keeping its promise to Canadians.
All businesses are required to apply the GST or the HST at the new and lower rates beginning New Year’s Day. The total savings from the two-percentage-point reduction in the GST rate will amount to approximately $12 billion for all Canadians next year.
Individual savings will be significant:
That’s more money in the pockets of consumers to spend, save or invest. The GST cut helps improve consumer confidence, encourage business growth and strengthen the Canadian economy.
Since coming to office nearly two years ago, the Government has taken action that will reduce the overall tax burden for Canadians and businesses by about $200 billion in this and the next five fiscal years, bringing taxes to their lowest level in nearly a half a century.
Among the tax cuts is a commitment to reduce the federal corporate income tax rate from over 22 per cent this year to 15 per cent by 2012, enabling us to achieve the lowest corporate income tax rate among the world’s major developed economies.
Our Government is establishing a proud legacy of tax relief. This is an achievement we can all be proud of. Our Government is putting Canadians first, keeping our promises and managing the economy in an effective and responsible way.
The bottom line is that 2008 will be less taxing for all Canadians.