Submissions to Government

2016 Federal Budget

The Portfolio Management Association of Canada (“PMAC”), through its Industry, Regulation & Tax Committee, is writing to express our thoughts on certain taxation and pension changes announced in the 2016 Federal Budget (the “Budget”). We are pleased that the government has prioritized Federal and Provincial discussions on the Canada Pension Plan (CPP), along with a review of the pension investment rules. We note, with disappointment however, that the Target Benefit Plan (TBP) program was not included in the Budget nor were recommendations we have made in past submissions regarding RRSPs and GST/HST on investment management fees adopted.

In regard to the tax announcements included in the Budget, we would like to communicate our more immediate concerns regarding the implementation timeline of the Budget measure to amend the Income Tax Act (ITA) to prevent the deferral of capital gains tax in switch funds and treat mutual fund corporation (MFC) switch fund exchanges of shares as a taxable disposition at fair market value. This new measure will apply to dispositions of shares that occur after September 2016 and will have a significant impact on some of our Members and their clients.

Read letter.