UPDATE 2-Canada New Democrats vow to hike corporate taxes, run surpluses

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By David Ljunggren
OTTAWA, Sept 16 (Reuters) - Canada's left-leaning New
Democratic Party said on Wednesday it would raise the corporate
tax rate to 17 percent from the current 15 percent in its first
term in office if it wins the Oct. 19 federal election.
The party, which has never governed federally, also vowed to
run budget surpluses between C$3.02 billion (US$2.29 billion)
and C$4.11 billion in each of its first four years in power.
Polls show the New Democrats are slightly ahead of Canada's
ruling Conservatives, who say their opponents' promises would
require billions of dollars of tax hikes or deficits.
"When governments are focused and choose to live within
their means, they can do great things ... my plan will kick
start the economy," NDP leader Thomas Mulcair said in a
statement.
The leaders of the three main parties are due to hold a
televised debate on economic policy on Thursday.
Because the polls suggest none of the parties would win a
majority, they would have to rely on each other's support,
making their fiscal plans somewhat notional at this stage.
The NDP's tax proposal, released in a fiscal framework, is a
retreat from its 2011 pledge to boost the corporate rate to 19.5
percent. Mulcair said the new rate would keep Canada competitive
internationally while bringing in revenue to fund party
priorities.
The NDP said the corporate tax hike would raise C$3.7
billion for each of its first four years in power.
In total, the party said the tax increase and other measures
such as cracking down on tax avoidance and ending some breaks
for high earners would bring in an extra C$7.16 billion in
2016/17, and rise to C$7.54 billion in 2019/20.
Extra spending to fulfill promises such as a national day
care program and increased health funding to Canada's 10
provinces would total C$5.75 billion in 2016/17, and rise to
C$11.30 billion in 2019/20.
Neither the Conservatives nor the Liberals favor raising
corporate taxes. The Liberals have yet to release a framework as
detailed as that of the NDP.
Liberal leader Justin Trudeau, who has said the NDP promise
to balance the budget means unnecessary austerity, is proposing
to run budget deficits for three years to help finance a major
national infrastructure program. ID:nL1N11216C
($1=$1.32 Canadian)