The 2025 election is over, and we have a minority Liberal government with another party holding the balance of power.
Let's hope that this government prioritizes the much needed tax reform that CPA Canada has been calling for, but first there is a lot of work to be done.
First, the Liberal government needs to address uncertainty created due to its inability to implement a laundry list of outstanding tax measures announced in 2024, including:
- Bare trusts and trust reporting,
- Expansion of CRA audit powers,
- Enhancement of SR&ED and clean technology ITC's,
- The Canadian Entrepreneurs Incentive.
Second, it will need to implement some, or all, of its election promises, including commitments to:
- Cancel the consumer carbon tax,
- Eliminate the GST for first-time homeowners on homes costing up to $1 million,
- Introduce a 1% tax reduction of the lowest marginal personal tax rate,
- Reintroduce the MURB tax write-off,
- Improvements to the SR&ED program and introduction of a patent box regime,
- Development of an AI deployment tax credit for small and medium-sized businesses,
- Create a Health Care Workers Hero refundable tax credit,
- Conduct an expert review of the corporate tax system based on the principles of fairness, transparency, simplicity, sustainability, and competitiveness,
- Review and reform the process to apply for the Disability Tax Credit (DTC)
The latter two election promises will require stakeholder engagement, and CPA Canada will advocate to be at the table to ensure proper representation by CPAs. CPA Canada fully supports a review of the corporate tax system and have long been calling for a comprehensive review of the tax regime.
Third, the Liberal government will need to deal with Trump and his administration's tax policies, including:
- The U.S. withdraw from the OECD designed Global Minimum Tax,
- The continued threat of retaliation due to our Digital Services Tax, and
- Trumps promise for U.S. tax cuts
This government comes to power in a time of political uncertainty and complex tax policy. CPA Canada is here to advocate for the profession and taxpayers, as well as to provide CPAs with the insights needed to navigate these changes.
Originally posted on LinkedIn on April 29, 2025
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John Oakey
CPA Canada
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