Canadian Chamber: Federal Budget a Mixed Bag
Canadian Chamber: Federal Budget a Mixed Bag
Canadian businesses have faced an unprecedented two years, characterized by a multi-wave pandemic, inflation that has reached a thirty-year high, supply chain disruptions, extreme weather events, and geopolitical turmoil. Given these conditions, it has never been more important for the federal government to focus on economic growth.
(OTTAWA) – April 7, 2022 – The Canadian Chamber of Commerce’s President and CEO, Perrin Beatty, issued the following statement today in reaction to the federal government’s 2022 Budget.
“Canadian businesses have faced an unprecedented two years, characterized by a multi-wave pandemic, inflation that has reached a thirty-year high, supply chain disruptions, extreme weather events and geopolitical turmoil. Given these conditions, it has never been more important for the federal government to focus on economic growth.
This economic growth must be private sector-led. While our public finances have benefitted from higher inflation rates and energy prices and low interest rates, we cannot borrow or inflate our way to prosperity. Federal spending needs to be both fiscally responsible and targeted at where it can generate genuine economic returns. Generating economic growth requires carefully using all the tools available, including tax, regulatory, labour and infrastructure policy to attract private sector investment.
The government has set out an ambitious agenda in Budget 2022. It now will be essential to work collaboratively with businesses to ensure measures announced are implemented in a manner that will support economic growth.
A number of items announced in the budget will be welcome measures for Canadian businesses. They include:
- The gradual phase out of the small business tax rate when taxable capital reaches $50 million instead of $15 million.
- Investments in the critical minerals industry to support the full development of supply chains, from extraction through to processing and recycling.
- Various measures to support the net-zero transition, including the introduction of a tax credit for carbon capture, utilization and storage, incentives for Zero Emissions Vehicles, and investment tax credits for net-zero technologies.
- Funding towards a trusted employer program for Temporary Foreign Workers that will address labour shortages.
- Support for exploiting the opportunities from the legal cannabis sector.
Unfortunately, there were several elements that will undermine much-needed economic investment and growth, including:
- The absence of debt relief for businesses that used government support programs such as the Canada Emergency Business Account.
- A lack of focus on cybersecurity supports directly for the private sector.
- Only a partial review of the tax system rather than a comprehensive review, particularly given the implementation of additional measures on a sector basis for financial institutions and digital services.
The Canadian Chamber looks forward to working with the government on a number of consultative processes and gaining greater clarity on measures such as:
- Development of the national pharmacare program.
- Updates to the Competition Act.
- A review of the financial sector legislative framework, including related to digital currencies.
- Updates to the SR&ED tax credit.
- The Defence Policy Review and ensuring there is a strong focus on developing Canadian defence industrial supply chains.
- The creation of the Canada Growth Fund and Canadian Innovation and Investment Agency to ensure they play a complementary role to existing programs.
The gap between Canada’s potential and our performance continues to grow. It has never been more important for the government to view Canadian businesses as a partner, and not as a problem. Our competitors are squarely focused on how to attract investment and growth. That needs to be our top priority, too.”
About the Canadian Chamber of Commerce — The Future of Business Success
The Canadian Chamber of Commerce is Canada’s largest and most activated business network — representing 450 chambers of commerce and boards of trade and more than 200,000 businesses of all sizes, from all sectors of the economy and from every part of the country — to create the conditions for our collective success. The Canadian Chamber of Commerce is the undisputed champion and catalyst for the future of business success. From working with government on economy-friendly policy to providing services that inform commerce and enable trade, we give each of our members more of what they need to succeed: insight into markets, competitors and trends, influence over the decisions and policies that drive business success and impact on business and economic performance.
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Canadian Chamber of Commerce
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