Forecasting our economic future is challenging to say the least.
Economists are using phrases like “there’s no playbook for this.” It’s tough to find data on how global economies will react after going through years of global pandemic, a war in Europe, and record inflation that governments are trying to cool through measures that will likely lead to recession.
What we do know is that many of our current challenges aren’t going away in the short term and new struggles will likely arise in months to come.
On that note, the federal government’s Fall Economic Statement was heavy on supports and vision for building toward future goals.
You can read the full Fall Economic Statement here, but some key takeaways for the business community include:
The Government of Canada is making it clear that our future lies in investments in reaching net-zero. This includes training the workforce for sustainable jobs, attracting private sector investment to projects that reduce emissions and drive innovation in technologies that help achieve Canada’s climate targets, investing in clean technology manufacturing, and building our critical mineral strategy to grow our economic with sustainably developed clean technologies and goods.
Additionally, the federal government plans to roll out a tax credit for investment in clean technology. This refundable tax credit of 30% would offset costs for investing environmentally-friendly electricity generation, storage, heating equipment, industrial zero-emission vehicles.
The government is taking action the National Supply Chain Task Force’s recommendations, including addressing regulatory issues to improve efficiency and resiliency of our supply chains, modernizing cargo and clearance inspection practices, improving data reporting and monitoring, and investing in improving access to our international gateways.
The government plans to launch a Canadian Innovation and Investment agency to work to help new and
established Canadian firms innovate, commercialize research, and create new economic opportunities for workers and businesses in Canada. The government is also planning to modernize the National Research Council’s scientific infrastructure and help continue to propel Canadian innovation.
Investing in Canada Infrastructure Program is providing $33.5 billion for public infrastructure across Canada. Under this program, provinces and territories prioritize and submit projects to Infrastructure Canada for review.
The federal government is looking to boost immigration to 500,000 immigrants in 2025 with a focus on skilled labour sectors that are struggling with workforce shortages, including healthcare, manufacturing, and the building trades.
The government is looking to create a Scientific Research and Experimental Development tax incentive program, introduce a corporate-level 2% tax that would apply on the net value of all types of share buybacks by public corporations in Canada, and reaffirmed its commitment to the global minimum tax on large corporations.
The quarterly economic statements are a tool to highlight the previous budget allocations in more detail while hinting at what is to come in the next year’s budget.
For the upcoming 2023 federal budget, the Ontario Chamber of Commerce has set out some priorities for the federal government:
• Increase Ontario’s allocation of economic immigrants under the Ontario Immigrant Nominee Program, address the backlog of immigrants, and streamline recognition of foreign credentialing for sectors with pressing labour shortages.
• Invest in supply chain infrastructure to address bottlenecks along the supply chain, especially at ports.
• Protect Canada’s clean energy advantage by optimizing existing assets – such as nuclear and hydroelectricity – as well as incentivizing long-term investments in emerging technologies such as carbon capture and zero-emission vehicles.
• Modernize regulatory frameworks to enable growth in industries like mining and cannabis.
• Prioritize working with provinces and territories to remove barriers to interprovincial labour mobility and trade.
• Increase Canada Health Transfer Payments to meet the current and future pressures facing Canada’s universal health care system.
• Reform the federal tax system to attract foreign direct investment, drive domestic business growth and innovation.
It’s hard to predict what exactly will unfold in coming months. Whether we’re in recession, recovery, or growth — investing in the private sector is crucial to our success in moving toward goals of reducing greenhouse gas emissions and generating economic prosperity across Canada.
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