New federal taxes proposed for insurers and banks

Napoleon Elizer

New federal taxes proposed for insurers and banks

The parliamentary budget officer estimates proposed new federal taxes on some financial institutions could generate $5.3 billion over the next five years.

Two new PBO reports calculate the expected revenues from the Canada Recovery Dividend and a proposed permanent increase to corporate taxes on banks and life insurance groups.

The dividend is a one-time 15 per cent windfall tax on banks and life insurers profits made during the pandemic and the PBO says it will generate $3 billion.

Finance Minister Chrystia Freeland is also proposing to hike the corporate tax rate on bank and insurance profits over $100 million.

The PBO says increasing that rate from 15 per cent to 16 .5 per cent would generate $2.3 billion over the next five years.

The federal budget published last April predicted the two measures would raise more than $6 billion.  

 

The Canadian Press

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