M

manufacturing and processing (M&P) tax credit (crédit d'impôt pour la fabrication et la transformation (F&T)).

A federal tax reduction is provided on Canadian manufacturing and processing income not subject to the small business deduction. This credit has the effect of lowering the tax rate on M&P income to 21%.

marginal tax rate (taux marginal d'imposition ou de taxation).

The ratio of the increase in tax to the increase in the tax base (i.e. the tax rate on each additional dollar of income). A single individual earning $40,000 who experiences a $1,000 increase in income and has to pay an additional $452 in income tax has a marginal tax rate of 45.2 per cent ($452 divided by $1,000).

market transparency (transparence du marché).

Within the context of debt management, characterisations of a bond market where debt management strategies and operations are visible and well understood by market participants.

marketable debt (dette contractée sur les marchés).

Debt instruments that have a secondary market where they can be bought and sold by investors after they are first issued. Government of Canada marketable debt is issued in a number of forms including fixed-coupon marketable bonds, Medium Term Notes, Treasury bills, real return bonds and Canada bills. All Canadian dollar denominated marketable debt is initially sold by auction to primary dealers (chartered banks and investment dealers), who then resell the bonds to individual investors. For more information, visit the Department of Finance Government of Canada Securities Web page.

micro-credit (micro-crédit).

The allocation of small loans, usually under $5,000, to individuals to allow them to sustain self-employment, or to start up small businesses.

monetary policy (politique monétaire).

The process of managing the supply of money and credit to contribute to economic performance. The Bank of Canada manages Canadian monetary policy mainly through its influence on short-term interest rates, though it is ultimately answerable to the federal government for its actions. The Bank influences short-term interest rates by adjusting its own bank rate. A rise in the bank rate is an act of "tightening" the supply of money and credit, at once restraining elements in the economy which contribute to inflation and elements which contribute to economic performance. The reverse is also true. The bank rate and the money supply influence interest rates and the exchange rate of the Canadian dollar and determine the monetary conditions in which the Canadian economy operates. For more information on the monetary policy, visit the Bank of Canada Monetary Policy Web page.

money laundering (blanchiment de l'argent).

Methods by which the proceeds of crime are processed through the financial system and converted into "clean money," which cannot be traced to the person originating the transaction or to the criminal origins of the funds.
See also Financial Action Task Force on Money Laundering.

money purchase or defined contribution pension plan (régime de pension à cotisations déterminées ou à capital constitutif).

Plan that provides whatever pension income the accumulated contributions and return on investment in the plan will buy at retirement. Total annual contributions are limited to 18 per cent of earnings up to a maximum of $13,500.

monoline (monogamme).

Financial company that specializes in a single line of products such as credit cards, mortgages or home equity loans, and that may use direct marketing practices and statistical models to target specific customers. In many cases, monolines have no expensive overheads from large branch networks and have low-cost financing open to them by securitizing their loans on the capital markets, thus making these companies highly competitive.

most favoured nation (MFN) treatment (traitement de la nation la plus favorisée (NPF)).

Article I of the General Agreement on Tariffs and Trade 1994 (GATT 1994) requiring countries not to discriminate between goods on the basis of country of origin or destination. The MFN principle has provided the foundation of the world trading system since the end of World War II. Article XXIV of the GATT excludes regional trade agreements from the application of this rule.

mutual fund company (société de fonds communs de placement).

A company that uses its capital to invest in other companies. Its capital is a pool of funds gathered from a number of investors and placed in securities selected to meet specific criteria and goals. Mutual fund companies fall under the jurisdiction of the provincial securities commissions.