The federal government announced its budget 2024 on Tuesday, promising billions of dollars in new spending, offset by new revenue streams.
in front of documentAfter publication, the Liberals committed to implementing unconventional communications, selectively announcing many of the most important items in the weeks leading up to what they said would be a budget geared toward “generational justice.”
Vowing not to increase the deficit by maintaining other fiscal barriers, ministers have faced questions in recent weeks about how they plan to pay for the new measures announced in the budget and whether they would propose new or higher taxes on the wealthiest Canadians or Canadian businesses. .
From plans to increase the new housing stock, encourage small businesses and raise taxes on Canada’s highest earners, CTVNews.ca has examined the 416-page budget to find out what will make the biggest difference to your wallet.
Are you hoping to buy a house?
Before the official release of the budget, the federal government had hinted that the document would focus primarily on housing and increasing supply, including billions of dollars in measures already announced, and that they would come together in a “plan to solve “the housing crisis.” ”, this was revealed last Friday.
According to the budget, the Liberals are designing “a bold strategy to unlock 3.9 million new homes by 2031,” using a series of measures with spending spread over the next few years.
“Because the best way to make housing prices more affordable is to increase supply, and quickly,” the budget says.
Some of those measures include a plan to convert public land into housing, a new Canada Housing Infrastructure Fund and a supplement to the Apartment Construction Loan Program.
According to the Canada Mortgage and Housing Corporation, Canada needs to build 3.5 million homes by 2030 to restore affordability.
As for the shorter-term measures included in the budget, 30-year mortgage amortization for first-time home buyers purchasing new construction will be available starting August 1, 2024. And starting Tuesday there will be a increase for home buyers. ‘ Plan, from $35,000 to $60,000, that allows first-time homebuyers to withdraw more from their RRSP and make a larger down payment.
Measures to help tenants are also outlined in the budget.
These include a Canadian Tenants’ Bill of Rights, which is dependent on provincial and territorial buy-in, although the budget document does not set out a timeline for the policy measure.
The federal government also plans to convene and “set a firm expectation” with “banks, fintech companies, credit agencies and landlords” to allow renters to obtain credit for one-time rent payments, which the Liberals say could “ (do) It’s easier to get a mortgage, and maybe even at a lower rate.”
However, those banks, landlords and credit agencies are not legally required to do so.
Are you among the highest earners in Canada?
Ahead of Budget Day, experts warned that the federal government would need a way to generate additional revenue to help pay for some of its new spending, and there was speculation it could include a wealth tax, something Finance Minister Chrystia Freeland did not rule out. .
However, instead of a wealth tax, the budget includes plans to increase the capital gains inclusion rate (the proportion of capital gains that are taxed) for less than one percent of the elderly. Canada income.
That means that starting June 25, people with more than $250,000 in capital gains in a year will have to pay taxes on a larger portion of that money. The inclusion rate will also increase for capital gains from corporations and trusts.
The change allows for a simpler calculation at tax time, increasing the portion of capital gains that are taxed, rather than determining how much someone is worth and then taxing the wealthiest.
This change will also apply to about 12 per cent of Canada’s corporations, according to the budget.
For the vast majority of people – 99.87 per cent of Canadians, according to government estimates – there will be no increase in personal income taxes on capital gains.
Are you a small business owner or entrepreneur?
The budget includes measures aimed at both helping existing small and medium-sized businesses grow and getting new businesses off the ground.
Specifically, the federal government unveiled the New Canada Carbon Rebate for Small Businesses, which it says will “urgently return pollution pricing gains” to businesses with fewer than 500 employees.
The retroactive refund, from 2019-20 to 2023-24, will apply to about 600,000 businesses in the form of “an automatic, directly refundable tax credit for eligible businesses” where federal support applies.
The Minister of Finance will specify the amount of the reimbursement payments later, depending on the budget.
The Liberals are also allocating $200 million over two years, starting in 2026-27, to increase the venture capital available to “capital-deserving entrepreneurs” from some startups.
And another 6,250 Canadian youth-owned businesses will also be eligible for funding, mentoring and other support by 2029.
The budget also includes proposed tax changes for small and medium-sized businesses, including the amount of tax-free capital gains on the sale of business shares and agricultural and fishing properties, effective June 25, 2024.
Are you a post-secondary student?
To help postsecondary students pay for their education, the federal government plans to increase existing grants and interest-free loans to the tune of approximately $1.1 billion more this year.
The Liberals estimate that expanding grants and interest-free loans will help support a total of more than 1.2 million students.
The budget also details plans to help students pay for a place to live by changing the formula for calculating financial aid eligibility.
Going forward, an updated formula used by the Canada Student Financial Assistance Program will take housing costs into account when determining financial need and eligibility for funding.
“This will provide more student rental assistance to approximately 79,000 students each year at an estimated cost of $154.6 million over five years,” according to the budget.
The Liberals also plan to waive the GST when building new student residences at some post-secondary institutions, along the same lines they announced last year on purpose-built rental housing. Under the budget, they hope scrapping the GST on some residences will incentivize the construction of new student housing, a move with an expected price tag of $19 million over five years, starting this year, and $5 million a year after that.
“Building more student housing is good for young people and ensures there is a fair rental market for everyone,” the budget says.
Do you have school-age children?
The budget includes measures to help cover part of the cost of raising children.
That is, it details previously announced funding for a new school feeding program, allocating $1 billion over five years to expand access to more than 400,000 students.
According to the budget, the program is expected to save the average participating family with two children up to $800 a year.
The federal government’s goal is also to make child care more affordable, particularly by increasing the number of places available.
The new Child Care Expansion Loan Program, to the tune of $1 billion, will provide loans and grants to build or renovate child care centres, and changes to the Canada Student Financial Assistance Act and the Act Canada Student Loans will expand eligibility for loan forgiveness for some early childhood educators.
According to the budget, all provinces and territories are on track to achieve $10-a-day child care, but the document does not specify by what date.
Do you have any disabilities?
The Liberals have finally provided funding for their long-promised Canada Disability Benefit: $6.1 billion over six years and $1.4 billion ongoing.
They are framing the program as a legacy social policy that will help hundreds of thousands of low-income, working-age people with disabilities, designed to complement existing provincial and territorial benefits.
The budget also promises to cover the cost of medical forms needed to apply for this financial assistance.
The federal government is also proposing to expand the Disability Support Deduction, which allows some people with disabilities to deduct certain expenses, to include new costs covered by the program.
That is, the Disability Supports Deduction could include, subject to specific conditions: the cost of an ergonomic work chair, the cost of a bed positioning device, the cost of a navigation device for people with low vision and the cost of aids for memory or organization, among others. other accommodations.
Also included in the new healthcare funding is $1.5 billion over five years to launch the new national pharmaceutical care plan. The first phase, as previously announced, will help cover diabetes and birth control medications.
Various cost saving measures
The budget also sets out a number of smaller cost-saving measures, including boosting transparency in airline fees and asking provinces to help reduce junk fees, to help Canadians keep more money in their wallets. when you can.
Using the example of global pop superstar Taylor Swift’s upcoming Canadian tour, the federal government is also pledging to work with provinces and territories to “encourage them to adopt best practice requirements for ticket sales.”
According to the budget, those best practices include greater transparency in ticket sales, stronger protections for Canadians against excessive fees, and preventing fraudulent resellers and the use of bot technology.
With files from Rachel Aiello, CTVNews.ca Senior Digital Parliamentary Reporter