Thank you. On behalf of Chartered Professional Accountants of Canada, thank you for the opportunity to appear before this committee today. Merci pour l'opportunité.
October 1 was an historic day for the accounting profession with the unification of CPA Canada and CGA Canada under Chartered Professional Accountants of Canada. When unification of the profession in every province is complete there will be over 190,000 chartered professional accountants in Canada.
My remarks today will focus on the theme of improving Canada's taxation and regulatory regimes. I will also address other themes put forward by the committee, including balanced budgets, fiscal sustainability, increased competitiveness and economic growth, and why this focus will benefit Canada and sustain prosperity for all Canadians.
First, strong management of finances is critical. We support the federal government's goal to return to balanced budgets and to restraining annual government's spending rather than increasing the overall tax burden.
Second, we acknowledge the government has introduced measures to lower taxes and made improvements to ease the compliance burden. However, more can be done. There has not been a thorough review of Canada's tax systems since the Royal Commission on Taxation in 1966. It's time for tax reform. In the past, this committee endorsed our recommendation that the federal government undertake a comprehensive review of Canada's tax system to reduce its complexities and inefficiencies. We ask the committee to again support this recommendation. We also recommend that the government appoint an independent expert panel to provide advice on options to streamline the tax system and, in addition, consider creating a permanent, independent tax simplification office—as in the U.K.—to review existing and proposed measures. Tax reform would improve Canada's international competitiveness, productivity, economic growth, and long-term prosperity.
Third, turning to Canada's regulatory regime, we know that red tape places an undue burden on business and stifles competition and growth. We believe that through the red tape reduction action plan and annual scorecard the government is off to a good start. But it can go further. We have raised a number of suggestions, including modifications to the T1135 foreign reporting form and the withholding requirements under regulations 102 and 105. We also recommend that standardized business reporting, namely XBRL, be adopted for use by businesses for all government filings. This would reduce the compliance costs for business, and would improve the government's data collection, resulting in cost savings. We were pleased that standardized business reporting was included in your recommendations both in 2012 and 2013.
Fourth, we are also encouraged by the government's commitment to financial literacy. Helping Canadians develop financial knowledge is critical to individual and societal economic prosperity and growth. Indeed, financial literacy is all the more relevant in view of the level of household debt. CPA Canada is an active participant in strengthening financial literacy through publications on money management, surveys and studies, education campaigns, and volunteer outreach initiatives in communities across Canada. We were very pleased to see Minister Oliver partner with us on one of these outreach initiatives last month and encourage other members to follow suit. This is not a partisan issue.
Fifth, Canada's prosperity is closely linked to economic opportunities beyond our borders. Canada's small and medium-sized enterprises play a vital role in boosting economic growth and diversifying Canada's export markets. CPA Canada supports efforts to negotiate trade agreements that eliminate barriers to the free movement of goods, services, capital, and labour, both internationally and within our country.
Sixth, on R and D, we remain committed to initiatives that can improve productivity and spur job opportunities, such as the patent box which rewards innovative companies through a lower tax rate on profits earned through the exploitation of patents in Canada. Our R and D focus needs to be not only on incenting scientific research in Canada but also encouraging businesses to commercialize and retain patents in Canada. A patent box regime will do that.
Finally, skilled professionals are vital to Canada's economic future. We appreciate the federal government's initiatives to quickly integrate internationally trained professionals into the Canadian labour market, initiatives where CPA Canada is working closely with both ESDC and CIC.
We look forward to working with you to promote long-term economic growth.
We thank you for your attention.