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Presented | 26 February 1991 |
---|---|
Parliament | 34th |
Party | Progressive Conservative |
Finance minister | Michael Wilson |
Total revenue | 126.086 billion [1] |
Total expenditures | 158.405 billion [1] |
Deficit | $32.319 billion[1] |
‹ 1990 1992 › |
The Canadian federal budget for fiscal year 1991-1992 was presented by Minister of Finance Michael Wilson in the House of Commons of Canada on 26 February 1991.[2]
The budget did not bring sweeping tax changes after the consequential 1987 Income tax reform and the introduction of the GST on January 1, 1991.
Minor changes focused on improving tax incentives to disabled individuals and included:[3]
The budget announced a restriction to the deductibility of provincial payroll and capital taxes.[9] Indeed these taxes – unlike provincial corporate income taxes − were considered fully deductible expenses for federal income tax purposes. Several provinces (for instance Ontario) raised their payroll taxes in the early 1990s to raise additional revenues. This while minimizing impact on businesses that could partially offset the increase by claiming a federal tax deduction. These deductions were costing the federal government about $700 million per year.[10]
The budget laid out the following provisions:[11]
The $10,000 limit would preserve deductibility for 80% of businesses (those with a payroll less than $750,000 a year) and the 6% tax allowance would ensure Ottawa would not collect additional taxes for the 20% remaining businesses if the payroll and capital taxes rate remain at their budget date level.[10]
Applicating legislation was indefinitely delayed and the measure has never been in effect for capital taxes.[13]
Effective February 27, 1991:[14]
The budget announces that the Expenditure Control Plan unveiled in the previous budget is extended:[15]
Provisions pertaining to federal transfers to provinces (EPF and PUITTA) and Unemployment Insurance were contained in the Budget Implementation Act, 1991 which received royal assent on 17 December 1991.[17]
Additional expenditure control measures are included in the Bill C-56 (named the Spending Control Act) which was read a third time and adopted by the House of Commons on 27 April 1992 in a 137–84 vote (with 12 paired votes) and received royal assent on 18 June 1992.[18][19][20]