Analysis of Revenues Administered on Behalf of the Federal Government

Federal income tax revenues were $135 million lower in 2002-2003 than in 2001-2002. Personal income tax revenues increased $1.5 billion, while corporate income tax revenues decreased $2.0 billion. Other income tax revenues increased $365 million. The increase in personal income tax revenues is broadly in line with the growth of 3.3% in personal income, adjusted for the impact of tax reduction measures in the February 2000 budget and October 2000 Economic Statement and Budget Update. The corporate income tax revenue decline results from the impact of loss carry-forwards from 2001 and reductions in the corporate tax rate.

There was an increase of $4.1 billion in other taxes and duties. GST revenues were up $2.8 billion, mainly the result of strong growth in consumer demand, especially for durable goods and new housing. Customs import duties increased $147 million, reflecting a strong increase in imports subject to tariffs. The remaining taxes and duties were $1.1 billion higher, attributable to the introduction of the Air Travellers Security Charge on April 1, 2002 and to increases in the tobacco excise tax.

Employment insurance premiums increased $244 million due to the increase in the number of people employed and paying premiums offset somewhat by the reduction in premiums.

Exhibit 2: Revenues 2002-2003

Date modified:

2003-10-29