Champagne says budget is about building, not trade war

Finance Minister François-Philippe Champagne said Monday that Thursday’s federal budget will focus on building Canada’s economy and diversifying trade rather than on the ongoing trade war with the United States.

Champagne spoke at a pre-budget event at the Canadian Club of Toronto, where he said the moment calls for Canadians to talk about “building, investing in growth” and “making sure we’re more sovereign,” as reported by The Canadian Press via Global News. “Whatever may happen in these discussions (around Canada-U.S. trade), we will see,” he said. “But one thing is true, everything I just said that we need to do for ourselves.”

The budget, set for Nov. 5, is the second delivered under Prime Minister Mark Carney. It is expected to push the government’s effort to diversify trade, strengthen domestic industries, ramp up defence spending and respond to continuing concerns about affordability.

The comments came as talks with Washington appeared to be warming. Carney said in a statement Sunday that he had a “good” discussion with U.S. President Donald Trump and that teams from both countries would work in the coming weeks toward a deal, as we reported. Trump said over the weekend the two sides have a “concept” of an agreement. Negotiations broke down in late August.

Asked by CBC News journalist Peter Armstrong how renewed momentum in the talks could affect spending plans, Champagne said, “It’s not about them. This is about us, regaining our ability to build.”

In a separate account of the same event, Global News reported that Champagne promised the budget would simplify the tax code for small and medium-sized businesses. He said past measures were “boutique things” that could be hard to use without a tax adviser, and that small business owners “will see themselves in that budget.”

Champagne declined to give specific measures but suggested more changes are coming to the Scientific Research and Experimental Development program, which supports business research spending. He did not directly answer whether the budget will detail a planned sovereign wealth fund or a proposal to open Canada’s airports to private investment.

The Canadian Federation of Independent Business has asked Ottawa to use the budget to lower the small business tax rate and close gaps in tariff relief that leave out smaller firms. “Small businesses tell us they don’t want handouts,” said Corinne Pohlmann, the group’s executive vice-president of advocacy, in an Oct. 29 statement.

One of the largest items already in the fiscal plan is the productivity mega-deduction announced in September, which lets businesses write off the full value of eligible capital investments in the first year. The government estimates it will cost $36 billion over five years. Champagne said a local café buying a new coffee machine could use it, not only companies building pipelines.

The government has set a goal of attracting $1 trillion in private investment over the next five years. Our earlier look at the Parliamentary Budget Officer’s deficit outlook and the province’s own Ontario deficit figures show the fiscal backdrop for Thursday’s document.

If you find reporting like this useful, consider supporting Canada News Media, an independent Canadian newsroom with no corporate parent.