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DSA Canada Insights on the 2023 Federal Budget: A Made-in-Canada Plan

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Date: 30 Mar, 2023

On Tuesday, Deputy Prime Minister and Minister of Finance Chrystia Freeland tabled the 2023 federal budget, A Made-in-Canada Plan. With the pandemic in the rear-view mirror and financial uncertainty on the horizon, the budget takes a targeted look at sustainable spending, while continuing to follow-through on programs, all while bringing the deficit down.

The budget included three main themes: green technology investments, healthcare spending, and support for the rising cost of living. To attract investments in new machinery and equipment, the budget proposes a 15% to 30% tax credit for eligible investments in green technology. On the healthcare front, the budget includes a Canadian Dental Care Plan, as well as further details on the recently announced healthcare transfers.

The federal government is expecting a deficit of $40.1 billion in budget 2023-2024, a small reduction from the 2022 budget of $43 billion. The federal government is projecting deficits to lower throughout the subsequent years.

Of interest to direct selling businesses operating in Canada:

  • Budget 2023 proposes to amend the Canada Labour Code to improve job protections for federally regulated gig workers by strengthening prohibitions against employee misclassification. This will help ensure all federally regulated workers receive the protections and employer contributions to which they are entitled, including Employment Insurance and the Canada Pension Plan. Federally regulated industries include transportation services (air, road and sea), banking, telecommunications, broadcasting and Crown corporations.
  • A crackdown is proposed on hidden or unexpected consumer fees known as “junk fees” that inflate the overall cost of a product or service, in partnership with regulators and provincial governments.
  • For small businesses, the federal government has secured deals with Visa and MasterCard to lower credit card transaction fees, resulting in more than 90 per cent of businesses who accept credit cards seeing their interchange fees reduced by up to 27 per cent.
  • In the area of international tax reform, Canada is working with the Organization for Economic Cooperation and Development (OECD) countries to ensure that large multinational enterprises are taxed in the jurisdictions of their customers, and not just according to the residency of their businesses, and that they are subject to a minimum global effective tax rate of 15 per cent on their profits in every jurisdiction in which they operate.
  • The government proposes to amend the Food and Drugs Act to extend powers conferred by the Protecting Canadians from Unsafe Drugs Act (Vanessa’s Law) to natural health products. These changes enable regulators to take stronger action when health or safety issues are identified with natural health products on the market.

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Written by Peter Maddox, DSA Canada President and Kyle Larkin Vice-President at Impact Public Affairs.