Federal Budget 2017: Highlights
The federal government tabled its budget on Wednesday afternoon, which projects a deficit of $28.5 billion for 2017-18. Like last year, there weren’t any changes to the capital gains tax as some had predicted.
Here are some highlights:
National housing strategy—The federal government plans to invest more than $11.2 billion over 11 years to build affordable housing. Of that amount, $5 billion will go towards establishing a national housing fund to address critical housing issues and prioritize support for vulnerable citizens. The government will also invest $202 million over the next 11 years to make surplus federal lands and buildings available to housing providers at low or no cost for the development of affordable housing.
Housing Statistics Framework—As part of the national housing strategy, the federal government will give $39.9 million to Statistics Canada over five years to develop and implement the Housing Statistics Framework (HSF), which builds on its plan to gather data on foreign homebuyer activity. The HSF will leverage existing data from provincial-territorial land registries, property assessment programs, and administrative records to create a nationwide database of all residential properties in Canada, and provide up-to-date data on purchases and sales. In fall 2017, StatsCan will start publishing initial data.
Canada Savings Bonds—The government plans to discontinue the sale of Canada Savings Bonds (CSBs) this year as they’re no longer a cost-effective source of funds for the government and the program’s popularity has declined significantly. The decline in their popularity can be attributed to higher yielding retail instruments such as government-insured products (including GICs). If you already have a CSB, don’t worry. All outstanding bonds will continue to be honoured.
Read:Federal Government May Scrap Canada Savings Bonds
Increased child care—Starting in 2018-2019, the government plans to invest $7 billion over 10 years to support and create more high-quality, affordable child care spaces across Canada.
Caregiver benefit—The government will provide $691.3 million over five years to create a new employment insurance (EI) caregiving benefit of up to 15 weeks. This will cover a broader range of situations where individuals are providing care to an adult family member.
Parental benefits/leave—Canadians will be able to receive EI parental benefits over an extended period of up to 18 months at a lower benefit rate of 33% of average weekly earnings. EI parental benefits will continue to be available at the existing benefit rate of 55% over a period of up to 12 months. Women will also be able to claim EI maternity benefits up to 12 weeks before their due date—up from the current eight weeks—if they want to do so.
Sin taxes—Excise duty rates on alcohol products will increase by 2% tomorrow and rates will be automatically adjusted to the consumer price index on April 1 of every year starting in 2018.
Public transit tax credit—The public transit tax credit will be eliminated at the end of June. The government says “this credit has been ineffective in encouraging the use of public transit and reducing greenhouse gas emissions.”
Ride-sharing tax—The government will amend the definition of a taxi business under the Excise Tax Act to make ride-sharing businesses such as Uber subject to the same GST/HST rules as taxis.