IFIC Issues Pre-Budget Recommendations: Achieving Fairness in Taxation and Retirement Funding Options
August 15, 2011
TORONTO The Investment Funds Institute of Canada (IFIC) today released its recommendations to the House of Commons Standing Committee on Finance (the Committee) in respect of the 2012 budget. IFICs pre-budget submission makes three recommendations that are focused on achieving fairness in the taxation of investment and retirement savings products while also enhancing the choices available to Canadians to help them prepare for retirement.
Now is the time to take decisive action to ensure the long term financial health of all Canadians, said Joanne De Laurentiis, IFIC President and Chief Executive Officer. Canadians need to know that, when they take that important step toward saving for their retirement, they have options available that will meet their personal financial needs, and that all of their investment options are taxed fairly.
IFIC is asking the Committee to consider changes in the areas of the Goods and Services Tax / Harmonized Sales Tax (GST/HST) regimes, registered retirement savings plans (RRSPs), and pooled registered pension plans (PRPPs) that it believes will bring greater tax fairness, lead to better investment choices, and lower taxes on savings.
Key IFIC recommendations include:
A review of the manner in which the GST / HST is applied to mutual funds, with a view to achieving consistent tax treatment with other investment products;
Allowing income-splitting at age 55 with respect to certain registered plan types; and
Confirming that group RRSPs are qualifying alternatives to PRPPs.
IFIC notes that approximately 80% of Canadians invested in mutual funds hold these funds in retirement savings accounts. Any decision as to which products to hold in an investment portfolio should be based on an individuals financial circumstances, objectives, and risk tolerance.
IFICs pre-budget submission is available on the IFIC website at www.ific.ca.
IFIC is the national association of the investment funds industry. Membership consists of mutual fund companies, retail distributors and industry affiliates. The mutual fund industry currently manages $791.7 billion of client assets (as of July, 2011).
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Senior Manager, Communications
The Investment Funds Institute of Canada (IFIC)
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