Advocacy

April 16, 2024

While important actions on major projects and Indigenous economic partnerships move forward, Budget 2024 is ultimately not a plan to improve Canadian prosperity long term

Calgary, Alberta—Today, the federal government tabled its 2024 Budget, which essentially lays out its strategic plan for the next year and beyond. And every budget must answer a critical question: “Will Canadians be better off under this plan?”

While there are many important measures contained in this budget that individually will be positive; overall, this is not a plan that will enhance business competitiveness, economic growth, or Canadian prosperity.

 “While we are pleased to see forward movement on policy areas like the Indigenous Loan Guarantee Program and major project regulatory and permitting process improvements, we are deeply concerned that the introduction of new taxes, particularly targeting capital investment, will harm economic growth at a time where the economy and productivity are not strong,” says Adam Legge, President of the Business Council of Alberta.

On the positive side, we were pleased to see some movement on critical policy areas, including:

  • Further progress toward improving the efficiency and predictability of existing major project review and permitting systems, including efforts to change culture, reduce interdepartmental and interjurisdictional duplications; efforts to coordinate and streamline permitting; and improving timeline certainty;
  • Initiating an Indigenous Loan Guarantee Program of up to $5 billion, which is both resource and project agnostic, something the Council has advocated strongly for; and
  • On immigration, efforts to better align non-permanent resident applications with critical infrastructure needs; and steps taken to address foreign credential recognition in medicine and construction occupations.

However, a signature element of this budget is the introduction of new taxes, for both Canadians and for businesses. These measures risk increasing prices, and disincentivizing investment, specifically capital investment, which is critical for Canada to improve productivity and wages.

“Ultimately this is a tax and spend budget,” says Mike Holden, Chief Economist at the Business Council of Alberta. “Adding new taxes at a time when investment is lagging, productivity is declining, and per capita GDP is falling, is not a recipe for improving our economy. We need a system that encourages firms to invest more money into their businesses, and ultimately boosts prosperity.”

Furthermore, the fiscal outlook since the fall budget update projects annual deficit increases throughout the forecast period. Rather than increasing taxes to fuel continued spending growth, a more prudent path forward would to grow productivity and the economy, and in turn, revenue.

“Deficit spending is projected to increase relative to previous forecasts, a continuation of a trend in previous budgets and budget updates. Measures like new taxes should only be used as a last resort and in a way that doesn’t get in the way of a long-term growth plan to improve Canada’s productivity, fiscal sustainability, and ultimately, make Canadians better off,” says Holden.

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About the Business Council of Alberta. The Business Council of Alberta is a non-partisan, for-purpose organization dedicated to building a better Alberta within a more dynamic Canada. Composed of the chief executives and leading entrepreneurs of the province’s largest enterprises, Council members are proud to represent the majority of Alberta’s private sector investment, job creation, exports, and research and development. The Council is committed to working with leaders and stakeholders across Alberta and Canada in proposing bold and innovative public policy solutions and initiatives that will make life better for Albertans.

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