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ACFO welcomes the Canadian Centre for Policy Alternatives’ 2016 Alternative Federal Budget (AFB) and supports its recommendations to restore the public service and implement fair, progressive tax reform.
The AFB rightly points out that after a decade of extensive cuts, there is currently “insufficient funding and staffing to provide the services the public needs in a timely, accurate, and transparent way.” The public service must be restored in order for the government fulfill its promise to improve access to and availability of public services to all Canadians.
A number of the AFB’s recommendations and priorities regarding taxation mirror our own, including those made in our recent budget submission. ACFO especially appreciates that the AFB is emphasising that “while raising tax rates at the top has the potential to make the tax system fairer, without also plugging the holes a significant part of the new revenues will leak out.”
The AFB provides practical recommendations on how this could be accomplished, including a requiring offshore subsidiaries to have “economic substance,” applying a 1% withholding tax on Canadian assets held in tax havens, increasing Revenue Canada’s capacity to investigate tax evasion, and supporting the measures proposed by the OECD and G20 to combat corporate tax base erosion and profit-shifting (BEPS).
These recommendations are important because ACFO believes restoring balance and fairness to the Canadian taxation system is essential to funding the government’s progressive platform and to achieving their aim of an open, transparent Canada.