Opposition parties set priorities ahead of tax update

Opposition parties set priorities ahead of tax update

Opposition parties set priorities ahead of tax update


A senior government official says Finance Minister Chrystia Freeland’s autumn economic statement will propose taxing corporate share buybacks in a bid to encourage companies to invest in domestic operations and workers.

The source spoke to The Canadian Press on condition of anonymity because they were not authorized to publicly discuss the content of the fiscal update.

Thursday’s fiscal update is expected to include Canada’s response to US President Joe Biden’s Inflation Reduction Act, which also included a 1 percent tax on corporate stock purchases.

Environment Minister Steven Guilbeault blasted oil companies last week for making very limited investments in climate action, even as massive inflation-driven profits allowed them to fill shareholders’ wallets.

Oil giant Cenovus today announced third-quarter earnings of $1.6 billion, up 192 percent from the same quarter a year ago.

The company also gave $659 million to shareholders through share buybacks during the quarter.

The fall economic statement is expected to focus on boosting investment in Canada’s clean energy industries in response to new fiscal incentives from the United States.

The government is expected to use the update as an attempt to signal its fiscal responsibility, with inflation high and a potential recession looming.

Freeland warned that the government will not be able to compensate all Canadians for the rising cost of living.

Speaking in Windsor, Ont., last month, Freeland said the fiscal update will focus on an economy Canada is trying to “harness” for the future — one that relies on clean energy, electric vehicles, battery manufacturing and critical minerals. .

Federal party leaders have used next autumn’s economic statement as an opportunity to push their priorities.

In a letter to Freeland on Sunday, Conservative leader Pierre Poilievre urged the government not to impose new taxes and impose new spending without moderate budget cuts.

For his part, NDP Leader Jagmeet Singh wrote a letter to Prime Minister Justin Trudeau urging him to fight “corporate greed” and immediately reform the employment insurance program.

As fears of a potential recession grow, interest groups have also aired their demands.

In a news release, the Canadian Chamber of Commerce said, “With a growing number of experts predicting a slowdown in the Canadian economy, it is important that the government use the fall economic statement to set a clear strategy for growth.”

The group said it would like the federal government to help address the labor shortage while reforming regulations and avoiding new taxes.

Aggressive interest rate hikes by the Bank of Canada have also raised concerns among labor groups about what the economic slowdown will mean for jobs.

In a press release on the autumn economic statement, the National Council of the Unemployed urges the federal government to include EI reforms in the update.

“We don’t have to wait for the next crisis to fix the social safety net,” the organization’s spokesperson said in a statement.

This report by The Canadian Press was first published on November 2, 2022.

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