The Deputy Prime Minister and Minister of Finance, Chrystia Freeland, presented Budget 2022 in the House of Commons on Thursday, April 7. The Budget focused on three pillars: investing in people, growing the economy under the green transition, and tackling productivity and innovation. The Budget also contained a focus on Canada’s place in the world, as well as a continued emphasis on existing government priorities such as climate change and housing affordability for Canadians. Highlights include:
- Investing $4 billion over five years for funding to the Canadian Mortgage Housing Corporation to launch a Housing Accelerator Fund to support cities in increasing housing supply, such as per-door incentives. The fund will consider rural community situations.
- Creation of a Tax-Free Home Savings Account to provide prospective first-time homebuyers with the ability to save up to $40,000. Contributions would be tax-deductible (like an RRSP), and withdrawals including investment income would be non-taxable (like a TFSA).
- Creation of the Canada Growth Fund, which would operate at arms-length from the federal government, to attract investment towards the policy goals of emissions reductions, supporting exports, and supply chains.
- $1.5 billion over seven years for infrastructure investments to support critical mineral supply chains, plus a further $1.5 billion to support manufacturing, processing and recycling applications.
- Introduction of a 30% Critical Mineral Exploration Tax Credit, with a particular focus on nickel, lithium, cobalt, graphite, REEs, vanadium, tellurium, gallium, scandium, titanium, magnesium, zinc and platinum.
- Commitment to develop a post-pandemic Federal Tourism and Growth Strategy, including $20 million over two years, starting in 2022-23, in support of a new Indigenous Tourism Fund.
- Additional taxes on banks and insurance companies, including a one-time 15% tax on income above $1 billion under the Canada Recovery Dividend, and permanently raising the corporate income tax on banks and insurance companies by 1.5% on income over $100 million.
- Introducing a gradual phase-out of access to the small business tax rate, with access to be fully phased out once a business reaches $50 million of capital rather than the current $15 million. This will save small businesses an estimated $660 million over four years.
- Up to $30 million over two years, starting in 2022-23, to Environment and Climate Change Canada to administer direct payments to support emission-intensive, trade-exposed SMEs in Alberta, Saskatchewan, Manitoba and Ontario.
- $329.4 million over six years (with $0.6 million in amortization), starting in 2022-23, to triple the size of the Agricultural Clean Technology Program.
- $48.2 million (with $2.8 million in remaining amortization) towards a new streamlined foreign worker program for agriculture and fish processing employers.
The Canadian Chamber of Commerce has reviewed the budget’s contents and has provided their insights and an in-depth analysis:
- Budget 2022 Summary (Policy Team Report): https://chamber.ca/wp-content/uploads/2022/04/Budget-2022-Member-Update-_FINAL-1.pdf
- Budget 2022: More fiscal room and some more spending (Chief Economist Report): https://chamber.ca/wp-content/uploads/2022/04/Budget_2022_EconomistView.pdf
The full 304-page budget document titled Budget 2022: A Plan to Grow Our Economy and Make Life More Affordable can be found here: https://budget.gc.ca/2022/pdf/budget-2022-en.pdf
