Deputy Prime Minister and Minister of Finance Chrystia Freeland presented the 2024 federal budget on April 16^th with several key announcements relevant to Saskatchewan’s business community. While this year’s budget has addressed many pressing issues for Canadians and Saskatchewan residents, such as housing, healthcare, and affordability, it also introduces notable provisions directly impacting our local businesses.

We are especially pleased to see the federal government has responded to the Saskatchewan Chamber of Commerce’s advocacy efforts on the return of the Carbon Tax Fuel Charge Proceeds to small and medium enterprises.

“The Saskatchewan Chamber has been relentlessly advocating for the return of carbon tax proceeds to businesses since 2021. We are pleased to note that the Federal Government has prioritized this.  We welcome the return of more than $300 million to Saskatchewan businesses,” said Prabha Ramaswamy, CEO, Saskatchewan Chamber of Commerce.

The Saskatchewan Chamber of Commerce is encouraged by:

• New Canada Carbon Rebate for Small Businesses – $2.5 billion in funds has been earmarked for a rebate to small and medium Canadian enterprises from Carbon Tax Fuel Charge Proceeds, collected from 2019 to 2024. Proceeds will also be returned automatically each year going forward.
• Building Capacity in Artificial Intelligence – A new AI Compute Access Fund and $2.4 billion have been allocated to bringing Canada to the forefront of this emerging and growing technology sector.
• Investing in Young Entrepreneurs – $60 million has been allocated over five years to Futurpreneur Canada to help an estimated 6,250 businesses launch and expand.
• Immediate Write-Offs for Technology Investment – Businesses that invest in patents, data network infrastructure equipment, computers, and other data processing equipment will be able to write off the full cost of these expenditures between now and January 1, 2027.
• National Regulatory Alignment – a focus on addressing barriers to Internal trade to help strengthen the foundation supporting Canada’s economy.

The Chamber, however, has concerns about a number of initiatives announced in the Budget, and about the impact the spending in the Budget will have on the increasing cost of servicing the country’s debt.

The Budget announced an increase to the tax on companies and individuals receiving more than $250,000 in capital gains. The capital gains inclusion rate is increasing to 66 per cent, up from 50 per cent, on capital gains above $250,000 for individuals, and on all capital gains for corporations and trusts.

The Chamber is very concerned that this could have a significant and negative impact on investment attraction to the province. Rather than imposing additional tax burdens on corporations, the Chamber supports tax policies that incentivize investment, entrepreneurship, and risk-taking. These elements are vital components of a vibrant and resilient economy.

We are also apprehensive about the country’s growing debt. The Budget forecasts that the country will pay $54.1 billion in debt servicing charges in 2024/2025 – that’s more than it will spend on health care in the same year. We support the Canadian Chamber of Commerce’s statements around the need for a real plan to promote productivity and restore economic growth in Canada to address Canada’s stalled GDP growth which is resulting in a decreased quality of life for Canadians.

The Chamber continues to advocate for issues critical to our members:

• Ensuring fiscal responsibility and the efficient use of tax revenues to promote Canada’s economic growth.
• More measures aimed at small businesses, the backbone of Canada, to help them thrive and provide services and employment to millions of Canadians.
• Increasing the Small Business Deduction Limit from $500,000 to $750,000 to stimulate growth and scalability for businesses.
• Focus on our critical minerals including uranium and potash.

As the voice of Saskatchewan business, we urge the federal government to prioritize debt reduction in the years to come, to ensure Canada’s long-term economic health and resilience.

Read the full budget and related materials from the Government of Canada here.