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ARTICLE · 02 MARCH 2018

Highlights Of Canada's 2018 Federal Budget

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The federal budget (Budget 2018) tabled on February 27 (Budget Day) contains a number of proposed amendments to Canada's Income Tax Act (Tax Act).

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The federal budget (Budget 2018) tabled on February 27 (Budget Day) contains a number of proposed amendments to Canada's Income Tax Act (Tax Act). This bulletin focuses on certain (i) business income tax measures; (ii) international tax measures, (iii) sales and excise tax measures and (iv) personal income tax measures, proposed therein.

Business Income Tax Measures

Passive Investment Income

In July 2017, the Department of Finance (Finance) launched public consultations to address a perceived deferral advantage available to shareholders of private corporations. Finance was of the view that it was inappropriate for a private corporation to use its retained earnings derived from active business, which have been taxed at preferential corporate income tax rates, to finance passive investments held within the corporation. Considering the feedback received from stakeholders during the consultation period, Budget 2018 proposes two tax measures intended to limit

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