This afternoon, the Honourable Chrystia Freeland, Canada’s Minister of Finance, delivered the 2022 Budget in the House of Commons. This budget, named A Plan to Grow Our Economy and Make Life More Affordable focuses on economic growth and affordability coming out of the COVID-19 pandemic. Some of the most significant investments focus on housing supply and affordability, innovation, and dental care. The budget also makes significant investments toward environmental sustainability through green technology investments and carbon capture initiatives.
This budget introduces the Housing Accelerator Fund, a program that focuses on supply to meet the needs of municipalities and communities, including upfront funding for investments in municipal housing planning and delivery processes that will speed up housing development.
This budget also introduces the Canada Growth Fund to attract investments from the private sector to meet policy goals that would boost Canada’s economy.
The government will also be launching a Canadian Innovation and Investment Agency, an independent federal innovation and investment agency that will work with Canadian businesses to help make investments toward a competitive Canadian economy.
This budget aims to support low-income Canadians through dental care, a deal brokered with the NDP after the NDP-Liberal supply and confidence agreement. The budget also increases spending toward Canada’s Department of National Defence, amidst geopolitical uncertainties after the Russian invasion of Ukraine.
Economic Outlook
The budgetary balance shows us a $113.8 billion deficit in 2021/2022. The budget indicates the deficit will decrease to $52.8 billion by 2022/2023 and to $8.4 billion by 2026-2027.
The main highlights from this year’s Federal Budget include:
Housing Affordability
$10 billion total investment over five years to make housing more affordable for Canadians
$4 billion over five years to launch a Housing Accelerator Fund - hoping to create 100,000 houses during that time
One-time $500 payment to people struggling with housing affordability
Introducing a two-year ban on foreign homebuyers, with the exclusion of permanent residents, foreign workers and students, and foreign homebuyers buying their primary residence in Canada
Doubling the funding of Reaching Home: Canada’s Homelessness Strategy, a community-based program to address and reduce homelessness
Implementing a new tax-free first home savings account to allow Canadians under 40 to save up to $40,000 towards their new home, and a multi-generational home renovation tax credit
$200 million to the Affordable Housing Innovation Fund to support rent-to-own projects
Developing a Home Buyers’ Bill of Rights
Environmental Sustainability & Green Technology
Introducing an investment tax credit for carbon capture, utilization, and storage – with the goal to reduce CO2 emissions
The proposed tax credit is expected to cost $2.6 billion over five years starting in 2022, with an annual cost of about $1.5 billion in 2026-27
$1.7 billion over five years to Transport Canada to extend the incentives for the Zero-Emission Vehicles (ZEV) program until 2025
$500 million in large-scale urban and commercial ZEV charging and refuelling infrastructure and $400 million over five years for ZEV charging infrastructure in suburban and remote communities
Innovation
$15 billion investment over five years toward the Canada Growth Fund which will foster investment in clean and green sectors including forestry
$1 billion over five years for the creation of a Canadian Innovation and Investment Agency
$3.8 billion over eight years to implement a Critical Minerals Strategy
Dental Care
$5.3 billion over five years to provide dental care
Children under 12 will be covered by the new federal dental plan starting in 2022
Those under 18, seniors and people living with disabilities will be covered by 2023
This plan will be fully implemented for low-income families by 2025
Pharmacare
Work toward a universal national healthcare program will include passing a national pharmacare bill by the end of 2023
The pharmacare plan will be fully implemented by the year 2025
Military & Defence
Launching a defence policy review
$8 billion increase in spending for the Department of National Defence over five years
$875 million over five years toward addressing cyber threats
Indigenous Communities
$4 billion over seven years starting in 2022
$268 million investment for healthcare in remote and isolated First Nations communities
$190.5 million for Indigenous communities to respond to the ongoing impacts of COVID-19
$22.6 million to support Indigenous-led mental health and wellness strategies
Job Opportunities
Expanding the Canada Workers Benefit for more Canadians - $1,000 more annually for a full-time, minimum-wage worker
More than $3 billion over three years to support nearly 500,000 new job and training opportunities
New Tax Initiatives
Introducing a temporary Canada Recovery Dividend for banking and life insurance groups to pay a one-time 15% tax on taxable income above $1 billion for the 2021 tax year
Permanently increasing the corporate income tax rate by 1.5% points on the taxable income of banking and life insurance groups above $100 million
Support for Ukraine
$500 million for military aid to Ukraine
$1 billion in new loan resources to the Ukrainian government
Watch Finance Minister Chrystia Freeland deliver Federal Budget 2022
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