CLC to Flaherty: Suspend Planned Corporate Tax Cuts

OTTAWA, ONTARIO--(Marketwire - Dec. 14, 2011) - The President of the Canadian Labour Congress has written to Finance Minister Jim Flaherty requesting that in his next budget he reverse planned tax breaks for corporations.

"The government keeps cutting corporate taxes in return for a promise that the private sector will use that money to create jobs but the strategy is simply not working," says Ken Georgetti.

The Conservative government has dropped the federal corporate tax rate from 21 per cent in 2006 to a planned 15 per cent for 2012. That will cost the treasury about $12 billion in foregone tax revenue. At the same time, the cash reserves for non-financial corporations have grown from $157 billion in 2001 to $477 billion in the second quarter of 2011.

"Tax cuts rob the government of revenues that could be put to good use creating a greater number of jobs in infrastructure projects and other much needed public investments," Georgetti says. "Government should be investing these billions of dollars in Canadian families rather than giving taxpayers' money to corporations that don't need it." He notes that the Royal Bank of Canada and the Bank of Nova Scotia have recently announced healthy profits for the period ending on October 31, and clearly don't need any more tax breaks.

Georgetti adds, "Corporations aren't living up to their part of the bargain to create jobs in return for tax cuts, so let them give that money back. We have long passed the point where Canada needs more corporate tax cuts to be competitive with
other nations."

The Canadian Labour Congress, the national voice of the labour movement, represents 3.3 million Canadian workers. The CLC brings together Canada's national and international unions along with the provincial and territorial federations of labour and 130 district labour councils. See the CLC website for a copy of the letter to Finance Minister Flaherty: www.canadianlabour.ca. Follow us on Twitter @CanadianLabour