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What the end of a U.S. COVID-19 border restriction could mean for Canada
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The United States lifted a pandemic border control policy late Thursday — a move that could have implications for Canada’s approach to migrants and asylum seekers.
The Trump administration invoked Title 42 shortly after the COVID-19 pandemic started in March 2020. The policy, which is part of the 1944 Public Health Service Act, allows American border authorities to quickly turn back migrants, including asylum seekers, at Ports of Entry (POE) to prevent the spread of disease.
“There is a serious danger of the introduction of COVID-19 into the land POEs and border patrol stations at or near the United States borders with Canada or Mexico, and into the interior of the country as a whole,” Dr. Robert R. Redfield, then director of the Centers for Disease Control, said in the 2020 order.
The Biden administration attempted to terminate Title 42 in 2022 but court decisions kept it in place. The order officially expired at 11:59 p.m. ET Thursday.
According to United States Customs and Border Protection (CBP) statistics, the United States Border Patrol expelled just over a million migrants between October 2021 and September 2022 under Title 42. It expelled 85,672 migrants in March of this year alone, the latest month for which statistics are available.
A CBP spokesperson did not answer the question when CBC News asked how many of the expelled migrants came from Canada.
The White House has introduced new border enforcement measures which will maintain expedited removal for migrants who attempt to enter the United States unlawfully.
Migrants and asylum seekers in north and central Mexico now have to use an app to fill out a form prior to arriving in the United States. The Biden administration also has said it will put more resources into anti-smuggling efforts in response to Title 42’s expiration.
Luisa Veronis, a geography professor at the University of Ottawa, said smugglers often spread misinformation about changes in border policies in an effort to increase business. She said the United States and Canada could respond by providing more information about what the recent changes actually mean.
“I think that’s another point where both Canada and the U.S. could control … making the information accessible, digestible. I think that would be a way to at least make people aware of what is really going on,” Veronis said.
The Immigration and Refugee Board of Canada assessed 45,444 refugee claims in 2022, according to board statistics. The Canada Border Services Agency (CBSA) and Immigration, Refugees, and Citizenship Canada (IRCC) report that 91,870 asylum claimants came to Canada last year.
Though Veronis is critical of the United States government’s approach to asylum seekers, she said it’s notable that the U.S. is using the expiry of a pandemic restriction as an opportunity to take a new approach to the problem. She said Canada could learn from that effort to address an influx of asylum seekers.
“The U.S. is trying to put in place practical ways for people to claim asylum by creating an app,” Veronis said.
“So maybe this is a good time to find legal pathways … We need to come up with a smart solution.”
New American border policy harsher: refugee lawyer
Aviva Basman, the president of the Canadian Association of Refugee Lawyers (CARL), said the Biden administration’s new approach to the border is even harsher than Title 42.
“What’s being replaced after Title 42 is something a lot worse. The new rule is more restrictive, more expansive, and it will be barring asylum seekers from seeking protection in the United States,” she said.
“This is going to substantially restrict accessibility to the border. There’s been a lot of problems reported with this app and its use.”
Title 42’s expiration comes just a few months after Canada and the United States renegotiated the Safe Third Country Agreement. The new, expanded version of the agreement closed a loophole which allowed migrants to make asylum claims in Canada if they arrived from the United States between official POEs.
Earlier this year, a family of four Indian nationals and a family of Romanian descent died near the Canada-United States border. Police in Canada say they believe they were trying to enter the United States from Canada through Akwesasne Mohawk Territory.
Basman said CARL fears that more asylum seekers, including those headed for the United States via Canada, could seek more dangerous methods of crossing the border.
“Individuals are going to feel forced to take more and more desperate, perilous routes in order to access asylum,” she said.
As part of the deal that renegotiated the Safe Third Country Agreement, Canada agreed to take 15,000 migrants from the Western Hemisphere.
Basman said she hopes Canada responds to the changes in United States border policy by opening itself up more to asylum seekers.
“I think that it’s really just important to think about this from the perspective of Canada’s obligations, and what this means for Canada’s reputation as a country that provides protection to refugee claimants who arrive,” she said.
“What we’re really hoping now is that Canada will provide increased access to its asylum procedures by putting in place different categories of exemptions that take into account some of the gaps in the U.S. asylum system.”
More money will land in the pockets of Canadian families on Friday for the latest Canada Child Benefit (CCB) installment.
The federal government program helps low and middle-income families struggling with the soaring cost of raising a child.
Canadian citizens, permanent residents, or refugees who are the primary caregivers for children under 18 years old are eligible for the program, introduced in 2016.
The non-taxable monthly payments are based on a family’s net income and how many children they have. Families that have an adjusted net income under $34,863 will receive the maximum amount per child.
For a child under six years old, an applicant can annually receive up to $7,437 per child, and up to $6,275 per child for kids between the ages of six through 17.
That translates to up to $619.75 per month for the younger cohort and $522.91 per month for the older group.
The benefit is recalculated every July and most recently increased 6.3 per cent in order to adjust to the rate of inflation, and cost of living.
To apply, an applicant can submit through a child’s birth registration, complete an online form or mail in an application to a tax centre.
The next payment date will take place on May 17.
News
Capital gains tax change draws ire from some Canadian entrepreneurs worried it will worsen brain drain – CBC.ca
A chorus of Canadian entrepreneurs and investors is blasting the federal government’s budget for expanding a tax on the rich. They say it will lead to brain drain and further degrade Canada’s already poor productivity.
In the 2024 budget unveiled Tuesday, Finance Minister Chrystia Freeland said the government would increase the inclusion rate of the capital gains tax from 50 per cent to 67 per cent for businesses and trusts, generating an estimated $19 billion in new revenue.
Capital gains are the profits that individuals or businesses make from selling an asset — like a stock or a second home. Individuals are subject to the new changes on any profits over $250,000.
The government estimates that the changes would impact 40,000 individuals (or 0.13 per cent of Canadians in any given year) and 307,000 companies in Canada.
However, some members of the business community say that expanding the taxable amount will devastate productivity, investment and entrepreneurship in Canada, and might even compel some of the country’s talent and startups to take their business elsewhere.
Finance Minister Chrystia Freeland unveiled the government’s 2024 federal budget, with spending targeted at young voters and a plan to raise capital gains taxes for some of the wealthiest Canadians.
Benjamin Bergen, president of the Council of Canadian Innovators (CCI), said the capital gains tax has overshadowed parts of the federal budget that the business community would otherwise be excited about.
“There were definitely some other stars in the budget that were interesting,” he said. “However, the … capital gains piece really is the sun, and it’s daylight. So this is really the only thing that innovators can see.”
The CCI has written and is circulating an open letter signed by more than 1,000 people in the Canadian business community to Trudeau’s government asking it to scrap the tax change.
Shopify CEO Tobi Lütke and president Harley Finkelstein also weighed in on the proposed hike on X, formerly known as Twitter.
We need to be doing everything we can to turn Canada into the best place for entrepreneurs to build 🇨🇦<br><br>What’s proposed in the federal budget will do the complete opposite. Innovators and entrepreneurs will suffer and their success will be penalized — this is not a wealth tax,…
—@harleyf
Former finance minister Bill Morneau said his successor’s budget disincentivizes businesses from investing in the country’s innovation sector: “It’s probably very troubling for many investors.”
Canada’s productivity — a measure that compares economic output to hours worked — has been relatively poor for decades. It underperforms against the OECD average and against several other G7 countries, including the U.S., Germany, U.K. and Japan, on the measure.
Bank of Canada senior deputy governor Carolyn Rogers sounded the alarm on Canada’s lagging productivity in a speech last month, saying the country’s need to increase the rate had reached emergency levels, following one of the weakest years for the economy in recent memory.
The government said it was proposing the tax change to make life more affordable for younger generations and fund efforts to boost housing supply — and that it would support productivity growth.
A challenge for investors, founders and workers
The change could have a chilling effect for several reasons, with companies already struggling to access funding in a high interest rate environment, said Bergen.
He questioned whether investors will want to fund Canadian companies if the government’s taxation policies make it difficult for those firms to grow — and whether founders might just pack up.
The expanded inclusion rate “is just one of the other potential concerns that firms are going to have as they’re looking to grow their companies.”
He said the rejigged tax is also an affront to high-skilled workers from low-innovation sectors who might have taken the risk of joining a startup for the opportunity, even taking a lower wage on the chance that a firm’s stock options grow in value.
But Lindsay Tedds, an associate economics professor at the University of Calgary, said the tax change is one of the most misunderstood parts of the federal budget — and that its impact on the country’s talent has been overstated.
“This is not a major innovation-biting tax change treatment,” Tedds said. “In fact, when you talk to real grassroots entrepreneurs that are setting up businesses, tax rates do not come into their decision.”
As for productivity, Tedds said Canadians might see improvements in the long run “to the degree that some of our productivity problems are driven by stresses like housing affordability, access to child care, things like that.”
‘One foot on the gas, one foot on the brake’
Some say the government is sending mixed messages to entrepreneurs by touting tailored tax breaks — like the Canada Entrepreneurs’ Incentive, which reduces the capital gains inclusion rate to 33 per cent on a lifetime maximum of $2 million — while introducing measures they say would dampen investment and innovation.
“They seem to have one foot on the gas, one foot on the brake on the very same file,” said Dan Kelly, president of the Canadian Federation of Independent Business.
Some business groups are worried that new capital gains tax changes could hurt economic growth. But according to Small Business Minister Rechie Valdez, most Canadians won’t be impacted by that change — and it’s a move to create fairness.
A founder may be able to sell their successful company with a lower capital gains treatment than otherwise possible, he said.
“At the same time, though, big chunks of it may be subject to a higher rate of capital gains inclusion.”
Selling a company can fund an individual’s retirement, he said, which is why it’s one of the first things founders consider when they think about capital gains.
Mainstreet NS7:03Ottawa is proposing a hike to capital gains tax. What does that mean?
Tuesday’s federal budget includes nearly $53 billion in new spending over the next five years with a clear focus on affordability and housing. To help pay for some of that new spending, Ottawa is proposing a hike to the capital gains tax. Moshe Lander, an economics lecturer at Concordia University, joins host Jeff Douglas to explain.
Dennis Darby, president and CEO of Canadian Manufacturers & Exporters, says he was disappointed by the change — and that it sends the wrong message to Canadian industries like his own.
He wants to see the government commit to more tax credit proposals like the Canada Carbon Rebate for Small Businesses, which he said would incentivize business owners to stay and help make Canada competitive with the U.S.
“We’ve had a lot of difficulties attracting investment over the years. I don’t think this will make it any better.”
Tech titan says change will only impact richest of the rich
Toronto tech entrepreneur Ali Asaria will be one of those subject to the expanded capital gains inclusion rate — but he says it’s only fair.
“It’s going to really affect the richest of the rich people,” Asaria, CEO of open source platform Transformer Lab and founder of well.ca, told CBC News.
“The capital gains exemption is probably the largest tax break that I’ve ever received in my life,” he said. “So I know a lot about what that benefit can look like, but I’ve also always felt like it was probably one of the most unfair parts of the tax code today.”
While Asaria said Canada needs to continue encouraging talent to take risks and build companies in the country, taxation policies aren’t the most major problem.
“I think that the biggest central issue to the reason why people will leave Canada is bigger issues, like housing,” he said.
“How do we make it easier to live in Canada so that we can all invest in ourselves and invest in our companies? That’s a more important question than, ‘How do we help the top 0.13 per cent of Canadians make more money?'”
More money will land in the pockets of Canadian families on Friday for the latest Canada Child Benefit (CCB) installment.
The federal government program helps low and middle-income families struggling with the soaring cost of raising a child.
Canadian citizens, permanent residents, or refugees who are the primary caregivers for children under 18 years old are eligible for the program, introduced in 2016.
The non-taxable monthly payments are based on a family’s net income and how many children they have. Families that have an adjusted net income under $34,863 will receive the maximum amount per child.
For a child under six years old, an applicant can annually receive up to $7,437 per child, and up to $6,275 per child for kids between the ages of six through 17.
That translates to up to $619.75 per month for the younger cohort and $522.91 per month for the older group.
The benefit is recalculated every July and most recently increased 6.3 per cent in order to adjust to the rate of inflation, and cost of living.
To apply, an applicant can submit through a child’s birth registration, complete an online form or mail in an application to a tax centre.
The next payment date will take place on May 17.
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