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Forbes Ranks Canada First Place for Business
In a recent survey, Canada was given a number one ranking in the world for the best country in which to do business. Canada's tax system has seen 'substantial improvement' which has increased its competitiveness. This has allowed its ranking to move up from fourth place ranking in 2010, overtaking Denmark which has gone to fifth place from the number one spot. Taxand Canada considers the tax advantage for multinationals investing in Canada as a result of improvements to its tax system.
Forbes commented that "Canada's standing as a business friendly locale has improved thanks to tax reform over the past two years", particularly a "reformed tax structure with a Harmonised Sales Tax introduced in Ontario and British Columbia in 2010." Some of that improvement will be reversed with the "de-harmonisation" of BC from the HST system. It is difficult to argue that referenda do not serve useful purposes in the democratic process. However, the recent referendum in BC in which the electorate voted to scrap the HST, illustrates how populism doesn't always lead to good public policy, particularly where tax policy is concerned.
Taxand Canada discusses improvements in tax administration in more detail
Although there have been some significant changes, there is still considerable room for improvement in the current system. For example, the legislative gap between announced tax changes and the implementation of those changes could be improved in order to increase certainty for taxpayers and further reduce compliance and planning costs in Canada. The task of creating and maintaining a competitive tax environment, one that minimises the drag on business activity that all taxes have, is an on-going one.
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