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Capital tax is a tax charged on a corporation's taxable capital. Taxable capital is the amount determined under Part 1.3 of the Income Tax Act (Canada) plus accumulated other comprehensive income. On January 1, 2006, capital tax was eliminated at the federal level.
Income taxes in Canada constitute the majority of the annual revenues of the Government of Canada, and of the governments of the Provinces of Canada. In the fiscal year ending March 31, 2018, the federal government collected just over three times more revenue from personal income taxes than it did from corporate income taxes .
A formal system of equalization payments was first introduced in 1957. [7] [ Notes 1]. The original program had the goal of giving each province the same per-capita revenue as the two wealthiest provinces, Ontario and British Columbia, in three tax bases: personal income taxes, corporate income taxes and succession duties (inheritance taxes).
The return is the method by which the Canadian government determines the appropriate amount of tax that should be paid by individuals and corporations. The result of filing a return with the federal government can result in either a refund (money owed to the person or corporation filing the return), or an amount due to be paid.
In Canada, the federal government makes payments to less wealthy Canadian provinces to equalize the provinces' "fiscal capacity" — their ability to generate tax revenues. The program began in 1957. [5] In 2016-2017, six provinces will receive $17.9 billion in equalization payments from the federal government. [6]
Another factor that determines if a corporation is eligible for the SBD is the "amount of taxable capital a CCPC and its associated corporations employ in Canada". [10] When the taxable capital exceeds $10 million, the federal "small business limit" is reduced. "If that amount reaches $15 million, the CCPC’s active business income is no ...
The Canada Revenue Agency (CRA; French: Agence du revenu du Canada; ARC) is the revenue service of the Canadian federal government, and most provincial and territorial governments. The CRA collects taxes , administers tax law and policy , and delivers benefit programs and tax credits. [ 4 ]
According to World Bank, "revenue is cash receipts from taxes, social contributions, and other revenues such as fines, fees, rent, and income from property or sales. Grants are also considered as revenue but are excluded here. Expense is cash payments for operating activities of the government in providing goods and services.