Canada markets closed

Canada finance minister says wants tax cuts in next budget

By David Ljunggren
Canada's Finance Minister Joe Oliver poses for a portrait in the Canadian High Commissioner's official residence in London June 23, 2014. REUTERS/Neil Hall

By David Ljunggren

WAKEFIELD Quebec (Reuters) - Canadian Finance Minister Joe Oliver said on Tuesday he wanted to cut personal taxes further in next year's budget, while also expressing concern about what he called a still fragile global economy.

The Conservative government, which relied on large budget deficits to help Canada avoid the worst of the recession, projects it will have a surplus of C$6.4 billion in the 2015/16 fiscal year.

The next federal budget is due in late February or early March of 2015.

"We are going to have a budgetary surplus. We will be focusing on reducing taxes to individuals," Oliver told reporters ahead of a two-day policy retreat in the Quebec town of Wakefield.

Asked whether this meant he wanted to cut federal income tax rates, he replied: "That's what I'm looking at."

The Conservatives have cut taxes several times since they took power in early 2006 and Oliver said the federal tax burden was the lowest it has been for 50 years.

Oliver said the pro-business government would continue to focus on economic growth.

He did concede that job creation figures for the last year in Canada have been anemic, saying this in part was due to exporters struggling with a sluggish world economy.

"Our economic future is not pre-determined. The global economy remains fragile," he said, citing "worryingly low inflation" in the Euro zone. He described the U.S. recovery as disappointing.

Oliver also said the government was closely monitoring the country's still strong housing market, but was not alarmed by its growth. Some financial commentators forecast housing prices could drop by up to 25 percent in the next few years.

(Editing by Jeffrey Hodgson, Meredith Mazzilli and Andre Grenon)