The Government of Canada has eliminated all remaining tariffs on machinery, equipment and inputs such as screws, electric motors and pipe fittings for industrial manufacturing. This measure will benefit Canadian businesses by lowering the cost of imports used to produce manufactured goods, making Canada a more attractive place to do business. When the tariff elimination measure was first announced in Budget 2010, the Government estimated that it could create 12,000 jobs across Canada.
Since 2009, more than 1,800 tariffs have been eliminated in the industrial manufacturing sector. This announcement will specifically benefit small and medium-sized businesses that rely on global supply chains and are looking to diversify their export markets. These changes will provide $450 million in annual tax relief for Canadian manufacturers.
Having access to global trade opportunities is an important source of competitive strength for Canadian businesses. Eliminating tariffs reduces import costs, allowing businesses to enhance their stock of equipment and improve their access to domestic and foreign markets.
-- Canada is the first G20 nation to eliminate all tariffs on machinery, equipment and inputs used in the industrial manufacturing sector. -- Manufacturing companies invested $14.7 billion in the Canadian economy in 2014. -- The manufacturing industry has become a high-tech, high-skill economic engine that represents 10.7 percent of Canada's GDP and directly employs close to 1.7 million Canadians, almost all of them in full-time, well- paying jobs. -- Economic Action Plan 2013 extended the accelerated capital cost allowance (ACCA) for investments in machinery and equipment used in manufacturing and processing. More than 25,000 businesses have taken advantage of the ACCA since its introduction in 2007. -- Manufacturers are also benefiting from Canada's lower federal general corporate income tax rate (15 percent), which was more than 22 percent in 2007. According to KPMG, total business tax costs in Canada are the lowest in the G7 and 46 percent lower than those in the United States.Quotes
"Our government's top priorities remain job creation and economic growth. Today's announcement builds on our commitment to making Canada one of the best countries in the world to do business. We are confident that our low taxes, global trade opportunities and clear investment rules will ensure that Canada's manufacturing sector remains globally competitive."
- James Moore, Minister of Industry
"The elimination of all tariffs on imported goods and equipment, along with other tax measures, is providing Canadian manufacturers with a significant competitive advantage. Manufacturers across the country are using these tax savings to invest in innovation, growth and jobs."
- Jayson Myers, President and CEO, Canadian Manufacturers & Exporters
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