Canadian Prime Minister Paul Martin, under pressure from an opposition party to scrap planned tax cuts in return for rescuing his shaky Liberal government, softened his stance on Monday and made clear he was ready to discuss deferring the tax measures.
Martin's minority government, badly damaged by a kickbacks scandal, will be toppled if Parliament defeats his budget next month. He is also facing the prospect of a nonconfidence motion from opposition parties, which look set to force a June 27 vote.
Martin needs the support of the left-leaning New Democratic Party to stand any chance of surviving, but the party says it will only back the budget if the government removes C$4.6 billion ($3.7 billion) in planned corporate tax cuts and spends the money instead on the environment and for social programs.
"We are prepared to discuss the possible deferral of the corporate tax measures, which are not due to take effect until 2008," a Martin adviser told Reuters. Martin had previously expressed doubt about rolling back the tax cuts.
The New Democrats declined to comment on the offer. Martin had a meeting on Sunday with New Democrat leader Jack Layton, who gave him a Tuesday deadline to respond to his demands.
Opinion polls show that if a vote were held now, the Liberals would be turfed out of power after 12 years and be replaced by a Conservative Party minority. The last election was in June 2004.
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