Canada needs to stay competitive as part of attracting foreign capital as part supporting advance manufacturing, resource development, food process, aerospace, automotive, etc. This presentation looks at different factors that drive business costs for various business.

1. Cost Competitiveness –
Canada – August 2017
BY: PAUL YOUNG CPA, CGA
DATE: AUGUST 29, 2017

2. Paul Young - Bio
• CPA, CGA (1996)
• Financial Solutions (FOPM/FPM)
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Financial Solutions
• SME – Advance Technology and Market
Entry
• SME – Supply Chain Management
• SME – Business Strategy and
Restructuring
Contact information:
Paul_Young_CGA@Hotmail.com

3. Agenda
 Taxation
 Productivity
 Innovation
 Labor Rates/taxation burden
 Hydro Rates
 Regulatory Burden / Business Climate

4. Cost Competitiveness
 Market set prices for business
 Government set policies like environment, labour laws, trade/investment, taxation
 It is not one policy that drives FDI, but many policies

5. Taxation / Ranking
Source - https://taxfoundation.org/corporate-income-tax-rates-around-world-2016/ or http://www.pwc.com/ca/en/media/release/canada-ranks-2nd-among-g7-nations-ease-of-corporate-tax-payment.html
Canada fell in 2017 from 9 to 17. Liberal Party of Canada Took over in 2016.

6. Ranking / Canada Productivity
Source - http://time.com/4621185/worker-productivity-countries/
Source -
https://www.forbes.com/sites/jackzenger/20
13/01/17/the-3-forces-that-drive-improved-
productivity/#3ff2246239a8 or
http://blogs.worldbank.org/growth/what-
drives-productivity
It is also called TFP (total
factor productivity) and
measured as a residual – the
difference between outputs
and a set of inputs (e.g. labor,
capital, and intermediate
goods, including energy, land
and buildings). Measurement
problems plague both inputs
(e.g. how do you account for
quality of labor or capital) and
outputs.

7. Innovation Ranking
 Source - http://www.wipo.int/pressroom/en/articles/2017/article_0006.html
• Canada has fallen 3
spots in 2016 from 15 in
2015 to 18 in 2016
• Liberals ran a platform
on spending on
innovation -
https://www.thestar.com
/news/canada/2017/03/1
2/liberals-nearing-
decision-on-how-to-
spend-800m-earmarked-
for-innovation.html

8. Labor Rates / Tax Burden
 Source - https://taxfoundation.org/comparison-tax-burden-labor-oecd-2016/

9. Labor Costs

10. Hydro Costs / Ranking
 http://www.worldatlas.com/articles/electricity-rates-around-the-world.html
• BC, MB and PQ generate the bulk of
their power through Hydro
• Ontario is out there when it comes
to high rates across North America
• Liberal Government is pushing FIT
at the federal level via their carbon
taxation policies -
http://www.torontosun.com/2017/0
7/20/canadian-youth-will-have-to-
wait-for-promised-green-jobs

11. Regulatory Burden
Source - https://www.forbes.com/sites/kurtbadenhausen/2016/12/21/sweden-heads-the-
best-countries-for-business-for-2017/#1215046c7ecd

12. Environmental Ranking
 Source – Yale University
Source -
https://issuu.com/2016yaleepi/docs/e
pi2016_final

13. Carbon Tax / Competitiveness
 Source - https://gncc.ca/business-costs-canadian-competitiveness-not-crying-wolf/?

14. Summary
 Hydro Costs
 Ontario and many of the Atlantic provinces are struggling with unsustainable residential and business rates for Hydro
 The Federal Government plans to introduce FIT at the federal level. FIT was a failure in Ontario -
https://www.theglobeandmail.com/opinion/a-sunny-ontario-experiment-gone-wrong/article19890164/
 Regulatory burden varies across Canada
 New taxation using leads to more regulatory filings
 New labor policies (Alberta and Ontario)
 Innovation funds to be effective need to be open to everyone.
 Tax policies need to be revised to encourage more innovation spending by business
 Wages have been stagnant for over 30+ years.
 More taxation is not always the answer
 Business will invest where they can get their return required by the business model.
 It is not one policy that drives cost competitiveness, but many policies
 Liberal are introducing carbon taxation, hikes to payroll taxes, no reduction in time to get projects approved.

15. Contact Information
Email:
Paul_Young_CGA@Hotmail.com