Newmarket’s business community told local MP Tony Van Bynen they want the federal government to address a wide range of issues to reignite the economy after the COVID1-9 pandemic — everything from reshoring manufacturing to tax credits for gym memberships.
Van Bynen hosted a consultation meeting with the Newmarket Chamber of Commerce today, Feb. 11, to gather suggestions for what should be included in the upcoming federal budget, which he said will be focused on rebuilding a better post-pandemic economy.
Chamber members had no shortage of ideas for the Newmarket-Aurora MP to relay back to his government later this month.
“My deepest wish is that we could have this level of discussion and quality of dialogue during question period in the House of Commons,” said Van Bynen after the discussion.
Scale back benefits to get people back to work
Chamber member Michael Smith said he wants to see more qualifiers placed on Canadian Emergency Response Benefit, although that program has ended and has been replaced with more generous unemployment insurance benefits. He believes the program gave too many people the option of not working.
“I have pointed out a couple of examples of part-time kids in high school making $2,000 a month and can’t be bothered to go back to work in Tim Hortons, which is owned by local residents,” said Smith.
Smith also argued that whatever money is put toward creating more jobs should be focused on private-sector jobs, not the public sector.
Van Bynen said the government had felt it was better to be too generous at the start of the pandemic than risk not providing enough support and causing the economy to “got into a tailspin.”
Concern about increased taxes from pandemic spending
Michael Croxon, CEO of Newroads Automotive Group, expressed his concern about how the amount of government spending during the pandemic and whether paying off the debt racked up over the past year will require increased taxes.
Van Bynen said that the cost of servicing the debt is manageable at one per cent of GDP, compared to the six per cent it cost in the 1990s. With that in mind, he said, the government believes focusing on the creation of a growing economy again will be the best move in the long run.
Create a tax credit for capital investments
Matthew Waddington of CPG Aerospace suggested an aggressive tax credit for capital investments would be a good way to help restart the economy.
“A significant portion of businesses are in one of two situations: they are either in survival mode or creating an exit strategy. Both of these situations lead businesses to reevaluate their level of investment (in their own operations). When uncertainty occurs, spending is reduced,” said Waddington.
When companies spend less on improvements, other businesses who provide things like new equipment see their revenues fall. Waddington is concerned that this creates a domino effect that makes the problem worse until something is done to convince companies to start investing again. A “very aggressive tax credit” on capital investments, he said, could do help do that.
“Something in the range of 10 to 20 per cent would be a pretty small carrot when what we need is a real kick in the caboose,” he said.
“If you need to buy a truck and you can get a 50 per cent tax credit for the next year, then not pushing that purchase off would be the fiscally responsible move.”
He also noted this could be a good way to get businesses to purchase more environmentally sustainable equipment, which jives with the government’s goal of growing back a greener economy.
Support for green businesses
Pete Basso of Demand Renewables said the federal government could also further that goal by assisting green businesses such as his. He would be interested in having the federal government create a grant program similar to the Green Ontario Fund. This program provided grants and rebates for energy-efficient improvements to homes but was cancelled by the Ford government in 2018.
“We are pushing for some assistance for the green industry to level the playing field because we are operating at a significant disadvantage to the traditional hydro companies,” said Basso.
“It has a huge business case, and the Town of Newmarket has been able to define the environmental benefits of that program very clearly,” said Van Bynen.
“It’s an example of how we can pursue a green economy.”
Attract companies to reshore manufacturing
Another idea for a tax credit was pitched by Lynn Ford from the Celestica electronics testing lab in Newmarket. She argued the government needs to provide an incentive for manufacturing companies to bring their operations back to Canada after decades of seeing such operations moved offshore.
Ford said the pandemic has laid bare how a lack of domestic manufacturing has left Canada unprepared to be self-sustainable. She told Van Bynen that a tax credit could be used to convince companies to move back to Canada. She said that particular focus should be on convincing pharmaceutical companies to set up vaccine manufacturing facilities, ideally in small communities.
Simplify the tax code
Chamber member George Puccia argued now was the time to appoint a royal commission to go over the federal tax code and simplify it and help get the government out of the way of business.
“No one likes significant tax changes unless it benefits them directly. But given that the apple cart has already been overturned and possibly thrown off a cliff, what better time would there be to take a better approach,” said Puccia.
“I can’t think of anything that would work better to incentivize growth than tax simplification.”
Tax credits to encourage fitness and education
Karate-Do & Fitness Centre owner Brad Jones asked for help for the fitness industry, which he said has been “gutted” by the pandemic.
“Two-thirds of the industry is gone, permanently. And I am in survival mode myself. If it wasn’t for a federal loan and some provincial grants, I wouldn’t be able to survive either,” said Jones.
The martial arts instructor suggested that the federal government issue tax credits for people who sign up for gym memberships or sports programs. That would help the industry and help get people active again after so long being stuck inside.
John Wager Scholars Education Centre made a similar argument about education and tutoring programs. This past year has had a noticeable impact on the education of the students he sees, and making tutoring more affordable will help get kids back on the right track.
Residents who wish to share their ideas for the federal budget are invited to contact Van Bynen’s office, or to fill out a questionnaire at LetsTalkBudget2021.ca. Deadline for feedback is Feb. 19
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
