On June 6, 2011, Finance Minister Jim Flaherty unveiled his first majority budget in the House of Commons. As expected, the Conservative Government made little change to the original budget tabled on March 22, 2011 that was immediately dissolved due to the election.

With the reintroduction of the budget, the Conservative Government will move ahead with the same tax breaks, incentives and increased pension help for seniors that were previously presented before parliament. In addition, all tax measures will retain the March 22, 2011 implementation dates.

There was no change to corporate, personal or GST tax rates introduced in the March 22nd Budget. This remains true with the June 6th update.

For a complete summary and details of the tax measures announced on March 22, 2011, refer to our 2011 Federal Budget Commentary.

The budget did propose the following non-income tax changes:

  • As promised during the election campaign, the $2 per vote quarterly allowance for political parties will be phased out.
  • Provision has been made in 2011-12 for $2.2 billion to compensate Quebec in implementing its HST, provided that a satisfactory agreement can be reached." This compensation is consistent with agreements made between the federal Government and other provincial Governments that have agreed to a harmonized sales tax structure.

From an economic viewpoint, the budget papers highlighted the expected continued improvement in the Canadian economy and indicated that the Government remains committed to balancing the budget by 2014-15, one year earlier than previously anticipated.

Because of the Conservative majority, this budget is expected to pass quickly.

This letter has been prepared for the general information of our clients. Specific professional advice should be obtained prior to the implementation of any suggestion contained in this publication.

Should you have any questions or require more information, we encourage you to speak to your financial advisor or a member of our Taxation Group.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.