Canada Gains The
Competitive Edge, This Time!

It wasn’t long ago that some in the U.S. viewed Canada as a poorer northern neighbor with only one competitive advantage — in hockey. The Wall Street Journal reports that the advantage now goes much farther than the ice. On January 1, Ottawa cut the nation’s corporate tax rate to 16.5% from 18%, compared to the U.S. federal rate of 35%.

Canada has been cutting corporate taxes since the 1990s and enjoyed a virtuous cycle of investment, job creation and growth. The trend has continued under Conservative Prime Minister Stephen Harper, who has pledged to take the rate to 15% by 2012. ◆