Thank you.
I chair the taxation subcommittee at the chamber of commerce as a volunteer. My day job is being a chartered accountant. I work at PricewaterhouseCoopers.
Sharing the presentation with me today is Art Sinclair, a policy adviser with our chamber.
Actually, a lot of you are from southwestern Ontario, so I don't have to tell you our success story in Waterloo: Research In Motion, DALSA, life insurance companies, Piller's, Schneiders, Brick Brewing. There are all sorts of great things happening out where we live.
We need the government to help us succeed as well, and that's why we're here today. We have great universities out our way. We have the Perimeter Institute for Theoretical Physics. There are many excellent things happening out in Waterloo and Kitchener, mainly because of the people out there and the help we get from the government.
We have recommendations related to the government's fiscal agenda, and we actually have to thank you for a lot of things. We have to thank you that spending didn't increase this past year--the year ending in 2006. Our message to you on that is to hold the course, to keep spending in line with inflation and population growth.
Regarding tax reduction, thank you again. There are no more capital taxes federally. That's great news to business. That really helps. And it helps me do my job, because they're just a pain to compute.
Here are our recommendations for 2007. We need a reduction in personal income taxes. Our top tax rates kick in at $118,000 per annum. We need that threshold raised. We also need the lower tax bracket decreased for individuals. We don't want to see complexity in the system by introducing piecemeal tax credits like those we saw in Budget 2006, things like a bus pass credit, an employment tax credit, a child fitness tax credit, and other such tax credits. We want broad-based tax relief, not things that make the system complex.
Lower the corporate tax rate by one point starting next year. Introduce more favourable tax depreciation regimes by increasing tax depreciation in the year of acquisition. This will encourage our businesses to invest in capital, something that's definitely needed. Also, change the way research and development tax credits are taxed. Currently, they are taxed. We'd like to see them not subject to federal taxation. Ontario doesn't tax them. Also, we'd like to see the tax credits refundable for all companies, to give them further cash to invest in innovative research and development.
On debt repayment, you've done a great job. We're all happy about the $13 billion, but where did that come from? We probably paid too much tax last year, hence the tax reduction request. We're very encouraged by the fact that the excess went towards debt. We want the debt to keep going down. We encourage the government to get to a guideline of a debt-to-GDP ratio of 25% by 2012.
Every year I come here and ask for the employment insurance surplus to break even on a more regular basis. We often ask for rates to come down. Rates have been coming down beautifully. I think what we'd really like to see for our members in Kitchener Waterloo is that the employer rate decrease from 140% of the employee rate down to 100%--a matching contribution, but no higher.
Now, I would like to turn the mike over to Art Sinclair, who's the policy analyst, because you don't want to listen to me any more. He will talk about strategic investments.
You have to be really quick. We don't have a lot of time.