OTTAWA, DDTCNews – The Canadian government is considering imposing a 2% tax on redeem to share. This policy is expected to come into effect on January 1, 2024.
Through Fall Economic Statement, the Canadian government has declared redeem Stocks do not add value to the economy.
“Although redeem shares are one of the legal means of providing shareholder benefits, this practice diverts resources that could otherwise be invested in Canadian workers and business activities,” the government wrote. cbc.ca, cited Friday (4/11/2022).
The government believes that businesses should reinvest their profits in the real sector to overcome the productivity challenges that have been a hindrance to Canada’s economic growth.
The Government of Canada estimates that additional revenue will come from the imposition of a tax on redeem the shares are valued at C$2.1 billion for the next 5 years or C$420 million per year.
Note that the tax on redeem canada planned actions look like excise redeem actions to be taken by the United States next year.
Through Inflation Reduction Actthe United States will impose a higher duty redeem shares at the rate of 1%. This excise duty applies to listed companies.
In the United States, the excise redeem shares are not applied if redemption does not reach US$1 million or if redeem the shares are contributed to employee pension plans, employee stock ownership plans or similar programs.
If applicable, the excise tax is up redeem stocks are expected to generate an additional US$125 billion in cash receipts for the United States over the next 10 years. (sap)
“Evil pop culture fanatic. Extreme bacon geek. Food junkie. Thinker. Hipster-friendly travel nerd. Coffee buff.”
