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- Canada's Trade Advantages
Canada's Trade Advantages
Canada is one of the world’s best places to do business. We offer a beneficial combination of low costs, an educated workforce, a first-class corporate environment and an extremely competitive tax system.
Canada’s economy is very stable, and its financial institutions are well regulated and highly creditworthy. Its excellent R&D infrastructure, robust technological capacity and dependable supply of skilled workers create an advanced knowledge economy. It is also a gateway to the United States — the world’s largest economy — and Canada’s efficient transportation and logistics systems make it easy for firms located in Canada to reach the American as well as international marketplace.
Added to these advantages is Canada’s Gateways strategy, an advanced approach to international commerce that provides companies with cheaper, faster and more efficient access to global markets.
Canada’s Business Tax Advantage
The Government of Canada recognizes the significant effect of taxes on international competitiveness and has taken important steps to strengthen Canada’s business tax advantage. Canada will have the lowest statutory corporate income tax rate in the G7 by 2012, and the lowest overall tax rate on new business investment (marginal effective tax rate) in the G7 by 2010. In addition, Canada’s network of income tax treaties with over 80 countries facilitates cross-border trade and investment by removing tax barriers — for example, through the elimination of double taxation and the lowering of withholding taxes. Canada also has a value-added consumption tax — the goods and services tax (GST) — which is fully recoverable for businesses engaged in commercial activities and does not apply to exports.
The Government of Canada has taken steps to eliminate the customs duties on manufacturing inputs, machinery and equipment. For example, Budget 2009 eliminated the tariffs on a wide range of machinery and equipment in order to assist industry, and the government is proceeding with further consultations to provide additional broadbased tariff relief in support of Canadian business.
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