Still waiting for government’s economic growth plan: Canadian Chamber of Commerce

(OTTAWA) – December 14, 2021 – The Canadian Chamber of Commerce’s President and CEO, Perrin Beatty, issued the following statement today in response to the Fall Economic Statement.

“Today’s Fall Economic Statement was the right time for the government to lay out a blueprint for how we transition our economy from recovery into strong and sustainable economic growth that will attract investment. Unfortunately, the government has decided to wait until Budget 2022. 

Although the Canadian economy as a whole may now be above its pre-pandemic employment levels, significant challenges remain: more than a million job vacancies in economy; one-third of businesses reporting labour shortages; over forty percent reporting rising input costs as a challenge; and now the threat of a new COVID variant.

We welcomed the following measures from the Fall Economic Statement:

• Funding for rapid test kits to support distribution by provincial and territorial governments for school and workplace testing.

• Introduction of a tax credit for small businesses to support ventilation improvements.

• Extension of the home office expense deduction.

The Canadian Chamber welcomes the trajectory of decreasing deficit-to-GDP ratios and urges the government to adhere to their projections to get us below pre-pandemic deficit-to-GDP as quickly as possible to enable us to eventually create a viable pathway towards balanced budgets. Without a clear path to sustainable public finances, businesses face the risk of looming tax increases, especially given long-term issues that will place demands on public finances such as the energy transition. Additionally, any government spending needs to be targeted in areas that will deliver the greatest economic impact for every dollar spent. 

Within today’s fiscal update, the Canadian Chamber is concerned about the following elements:

• The lack of a clear fiscal anchor and a plan to bring Canada’s finances back into balance.

• The continued plan to unilaterally implement a Digital Services Tax that risks provoking retaliatory measures from the United States.

• The scarcity of ambitious measures to address supply chain challenges facing businesses across the economy.

• The absence of initiatives to come to grips with cyber security challenges facing businesses and address the infrastructure deficit.

• The continued absence of a long overdue review of Canada’s tax system.

Despite constrained public finances, there are targeted policy measures that the government can implement that will support economic growth without program spending. These measures include regulatory reform, dismantling interprovincial barriers, modernizing Canada’s privacy legislation and opening new markets for exporters.

We cannot afford to wait until we have emerged from COVID before tackling our core challenges that will inhibit long-term economic growth. The Fall Economic Statement unfortunately projects slipping back below 2% real GDP growth after the post-pandemic bounce back. We urge the government to make these measures a priority and to table an early budget after Parliament resumes in the New Year.”

About the Canadian Chamber of Commerce – Because Business Matters

The Canadian Chamber of Commerce helps build the businesses that support our families, our communities and our country. We do this by influencing government policy, by providing essential business services and by connecting businesses to information they can use, to opportunities for growth and to a network of local chambers, businesses, decision-makers and peers from across the country, in every sector of the economy and at all levels of government, as well as internationally. We are unapologetic in our support for business and the vital role it plays in building and sustaining our great nation.

-30-

For more information, please contact:
Phil Taylor
ptaylor@chamber.ca