Principal Issues: The taxpayer suggested that the 100% CCA rate available to certain computer equipment acquired after January 27, 2009 and before February 2011 that qualify for inclusion under class 52 of Schedule II of the Income Tax Regulations should be extended to acquisitions of such computer equipment made after January 31, 2011.
Position: None taken.
Reasons: Any proposed changes to the Income Tax Act and the Income Tax Regulations would have to be considered by Finance Canada and approved by Parliament. Accordingly, the taxpayer's suggestion was referred to the Honourable James Flaherty, Minister of Finance for his consideration.
October 22, 2010
XXXXXXXXXX
Dear XXXXXXXXXX :
Thank you for your correspondence of September 30, 2010, concerning the capital cost allowance (CCA) rate of 100% for computers.
You are referring in your email to the tax incentive provided by Class 52 of Schedule II of the Income Tax Regulations. Class 52 provides for a CCA rate of 100% for certain computer equipment acquired after January 27, 2009, and before February 1, 2011.
You suggest that it would be beneficial if the Government of Canada continues this tax incentive beyond January 31, 2011, to encourage small businesses to further invest in technology for 2011 and beyond.
The matter you raise is one of tax policy. The Department of Finance Canada is responsible for tax policy and legislative changes to the Income Tax Act and the Income Tax Regulations, whereas the Canada Revenue Agency is responsible for administering the tax system and applying the legislation as enacted. Any proposed changes to tax policy or legislation would have to be considered by Finance Canada and approved by Parliament. Therefore, I am forwarding a copy of our correspondence to the Honourable James M. Flaherty, Minister of Finance, for his consideration.
I trust that the referral is helpful.
Yours sincerely,
Keith Ashfield
Minister of National Revenue
c.c.: The Honourable James M. Flaherty‚ P.C.‚ M.P.
Minister of Finance
House of Commons
Ottawa ON K1A 0A6
Tim Fitzgerald, CGA
Tel. (613) 957-8967
2010-038224