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The government also said, starting in 2012, all provinces will have eliminated general capital taxes, or levies applied to a company’s financial assets. The federal government eliminated its portion of capital taxes in 2006 and then encouraged provinces to do the same.

Hugh Mackenzie, a research associate with the Canadian Centre for Policy Alternatives, argued that there is little evidence that corporate tax cuts have stimulated economic activity.

“In fact, the evidence suggests that the investment incentives that have been delivered through the tax system in the form of lower tax rates have simply gone into corporate cash flow and really had no economic benefit,” Mr. Mackenzie said.

He added that agreements between Canada and the U.S. require that American companies must pay federal and state governments in their home country the difference between any lower income-tax rate they are paying on their Canadian operations and what they would pay at home.

“When we reduce our tax rates below those of the United States, what we end up doing is transferring money to the U.S. Treasury,” he said.

Mr. Mackenzie acknowledged that the Canadian economy has performed better than other industrialized countries, such as the U.S., in recent years. But he credited that to tighter regulations in the banking sector — in effect before the Harper government came to power in 2006 — rather than tax cuts.

In an email to Postmedia News, a spokesman for Mr. Flaherty “debunks the concept of this money sitting on company balance sheets.” Chisholm Pothier says the tax cuts have received broad support from industry.