Our country has been on high alert since November 25, 2024, when then President-Elect Donald Trump threatened 25% across-the-board tariffs on Canada. These tariffs are set to do real damage to our economy — analysis from the Business Data Lab finds that 25% tariffs could reduce our GDP by 2.6%, the equivalent of Canadian households losing an average of $1,900 per year.

Canada’s trade with the U.S. has long been a strength — we are a critical and reliable supply chain partner for U.S. companies and consumers, with almost two-thirds of our trade being in intermediate inputs (used to make final products). However, we’ve been patching our economic holes with the convenience of U.S. trade for years and it’s left us vulnerable to a situation like the one we find ourselves in now.

Job number one is protecting our economic sovereignty and security. In addition to navigating retaliation as well as what emergency measures we put in place at home, we must focus on doing what’s in our control to build a stronger, more resilient Canadian economy.

All-In Canada Plan

Canadians need their government to work with the business community on multipartisan policy solutions that address internal economic roadblocks.

The priorities for a multipartisan plan include:

Deliver on the Promise of Free Internal Trade

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A genuinely open Canadian market, facilitating unobstructed movement of people, goods and services, is the cornerstone of a competitive national economy, yet we’ve heard from our members that it’s easier to export internationally than it is to export to neighbouring provinces! As it stands, foreign companies have better access to Canada than Canadian companies do.

East-west trade is increasingly critical as our economy faces tariffs. By fixing our internal trade and addressing barriers, like current provincial preferences for only local electricity providers, we could claim up to the estimated 4% GDP gain that’s currently sitting on the table. In fact, every year, Canada loses more to non-geographical barriers between provinces than we would from 25% tariffs.

As a result of freer trade within Canada, Canadians will enjoy lower prices and increased choice, workers will have greater mobility (particularly in fields with varying professional and educational requirements like healthcare), and our businesses will have an easier time scaling for success since what works for one province would be good enough for another.

Policy solution(s):

• Enhance labour mobility by pursuing mutual recognition so that provincial regulatory bodies recognize domestic skilled trade workers’ training and credentials from other provinces/territories.
• Reverse the increasingly large regulatory burden of the past decade by encouraging the removal of unnecessary and duplicative administration and regulatory barriers that hinder internal trade.

Improve Existing Trade Infrastructure

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Canada’s success is rooted in being a trading nation. Over two-thirds of our GDP relies on it. However, of late, the transportation of goods across Canada to other provinces/territories and beyond has not been efficient or reliable. If we can’t move it, we can’t sell it.

We undermine our ability to grow our economy when Canadian businesses can’t import or export goods reliably because of gaps, breakdowns and bottlenecks in trade and transportation infrastructure. Expanding our roads, rail, airports, and port infrastructure — using Canadian steel — and building new pipelines would enable us to transport our goods and resources safely and efficiently across our country. This would help ensure we can get our abundance of natural resources to the countries that need them, thus enabling us to reach our full trading potential and shore up our reputation as a reliable and responsible trading partner.

Policy solution: Introduce a Canada Trade Infrastructure Plan to help inform thoughtful long-term investment.

Cut Red Tape and Taxes

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Canada is in direct competition with the U.S. for business investment, especially now with President Trump cutting corporate tax rates and red tape. Our response can’t be to try and regulate or tax our industries into being more competitive. We need regulatory and tax systems that promote innovation and competition.

Regulatory

Running a business and getting big projects built needs to be more efficient. It still takes 10‒15 years for typical mine, major infrastructure or energy project to get approved. It can no longer be acceptable to delay critical infrastructure or business entrepreneurship by months or years while forms and duplicate assessments are completed.

Policy solution: Mandate an economic lens for regulators that requires them to consider the indirect consequences of their regulations on Canada’s growth and competitiveness.

Taxes

Canada hasn’t conducted a comprehensive review of our tax system since the late 1960s — a lot has changed since then. At such an uncertain time, the government should be doing everything it can to provide stability. That means getting rid of confusing measures like the increase to the capital gains inclusion rate and retroactive taxes like the digital services tax (which is also a trade irritant with the U.S.).

The social programs and services Canadians value depend on the public revenues generated from the private sector. To truly better these programs, the government needs to help the private sector grow, not rely on tax-and-spend policies that result in new corporate taxes — otherwise they’ll continue to tax a tapped-out base.

Policy solution: Undergo a comprehensive tax review to develop a simple, fair and principled tax system that works in the best interests of Canadians and businesses.

Open for Business

With the G7 and B7 Summits around the corner, the world’s eyes will be on Canada more than ever. And when the U.S. inevitably realizes they rely on what we have to offer — steel, aluminum, energy, agriculture and everything in between — we will show everyone that Canada is open for business.