Friday, April 23, 2021 7:03 am
pm@pm.gc.ca
EARTH DAZE, AS THE WORLD TURNS SOUR… PART 2
PM and Minister of Finance
This news item verifies the point made in “EARTH DAZE, AS THE WORLD TURNS SOUR” PART 1.
Things are going downhill fast and when the bottom falls out of the psychotic system will there be a Human Being left alive to say: “I – told you – yet the psycho in the system…. refused sanity to prevail!
Sincerely Canadian
C. M. B.
—————————————-
From Diapers And Mattresses To A Can Of Coke: Why Price Tags Are Climbing
Kyle Bakx
As Colin Crump walks through the manufacturing room for his mattress business, there is not a single material he sees that hasn’t jumped in price in recent months.
Wood, fabric, foam, and metal all cost much more for him to buy, if he can get his hands on them in the first place.
Of his 50 suppliers, only one or two haven’t hiked prices.
“Obviously, people hear about it with the wood products, but across the board, I can’t think of one product that hasn’t gone up anywhere from five to 10 per cent and some products are up about 50 to 60 per cent,” said Crump, president of Sleep Boutique, which makes custom mattresses.
Businesses and manufacturers in many different industries are having a similar experience, which raises concerns about inflation and the overall cost of many products that people buy.
The reasons are complex, but the pandemic plays a role — driving both supply and demand.
In the case of mattress foam, for example, when COVID-19 hit last year, Crump says manufacturers cut forecasts for how much would be needed. Meanwhile, demand started to rise, as people stuck at home, spent money there.
Price tags have already increased about 10 per cent at his store over the last six months and could climb further.
“My biggest concern is, how long can I maintain my price point before I have to increase that to my customers and if they do increase, does that potentially price me out of the market?” said Crump.
Sales at his business are up about 10 per cent over the last year, but up until the last few weeks, he wasn’t able to increase production without enough of the raw materials.
“With some of our suppliers, it’s like pulling teeth to actually get product. In the meantime … we have more work than we ever had, but we don’t have the materials to do it,” Crump said.
Supply woes
The rising expenses have followed a hockey stick-type curve, making it difficult to handle, said Louis Stack, the founder of Fitter International, which makes and sells fitness equipment.
The company put out a new catalogue in recent weeks and already those prices should be adjusted, said Stack, but it’s a challenge to keep prices in line as costs are continually climbing.
“I kind of want to wrangle them all together and do a year-end price increase that represents our new reality which will be a significant 20 to 25 per cent price increase in our products,” he said.
“I can tell this is going to be the worst thing you’ve ever seen in the history of our company.”
He describes the supply chain in a state of chaos as ships, railways and the transportation industry as a whole struggle to move as much cargo as is required.
At the same time, many factories that reduced production at the outset of the pandemic amid economic uncertainty are now challenged to meet demand because of COVID-19 impacts on their workforce, among other difficulties.
Meanwhile, with restrictions on travel and dining out, consumer spending habits have shifted from those items to products used at home.
Events like the Suez Canal blockage and the Texas power outage have only magnified the global supply chain problem.
When materials do arrive, Stack has noticed the quality often isn’t as good as it was pre-pandemic. For instance, wood is either too dry, too wet, damaged or not glued properly.
“Costs of products are going to skyrocket everywhere. People are going to need more money to buy them. That’s the new inflation that we’re going to see and it’s a reality that is going to hit all people, everywhere, in my opinion,” said Stack.
He expects it will take between 12 and 24 months for the supply chain to return to normal and by then, the higher prices could become the new standard.
Inflation fears
Inflation has remained close to the Bank of Canada’s target of two per cent, although some experts anticipate it could temporarily rise to three per cent in the spring because of rising commodity and energy prices, such as lumber, metals and oil. Food and home prices have increased, while clothing and recreation costs have fallen.
Some large corporations are also hiking prices because of rising expenses, such as soft drinks from Coca-Cola and Procter & Gamble‘s diapers and feminine-care products.
“This is something, as economists, we really fear,” said Amy Peng, associate professor at Ryerson University’s department of economics in Toronto, about rising inflation.
She expects prices for many products to continue to increase because of supply chain challenges.
“We wish there is a button or a lever so when the economy shuts down, we can just push the button and the economy returns. But the problem is this restart is actually difficult because there’s global logistic problems.”
Ryan McMillan, president of McCrum’s Office Furnishings, said he hasn’t experienced any delays in receiving product, mostly because he relies predominantly on Canadian manufacturers.
The main setback he’s faced is in procuring new fleet vehicles, a result of increased demand for parcel and other delivery services by many companies during the pandemic.
“We’ve got two five-tonne trucks on order. They’re not going to come until December, they’re just that backordered. We couldn’t find a transit van for the life of us,” said McMillan.
While he has yet to see an increase in expenses for the products he sells, it’s likely just a matter of time.
“The price of steel, aluminum, foam, all of it has gone up and of course all of it is part of office furniture,” he said. “We know it is going to happen purely because we’ve just seen the commodities go through the roof.”
—————————————————–
Thursday, April 22, 2021 6:52 pm
pm@pm.gc.ca
EARTH DAZE, AS THE WORLD TURNS SOUR…
PM and Minister of Finance
The COVID-19 pandemic that has “thinned the herd” greater than all wars that have been … the agenda?
Grand-standing asides of ‘concern’ for the ‘masses’… As George Carlin has been known to declare: “Excuuuuuuuuuuuuuuuse Me”!
Squeeze played and mortally wounded… between corporate clowns, corrupted politicians, and, can’t forget those twisted sinning pedophiliactic ‘holey rolly, preachers’…
It’s about the right time to clean the slate and start over without the psychotic system, please! To start with this conceived global debt needs to be just written off, how perverse burying people and family then digging us deeper in a contrived debt!
Sincerely Canadian
C. M. B.
———————————————-
As Canada’s Federal And Provincial Budgets Swell, Sales-Tax Increases May Follow
Erica Alini 10 hrs ago
Canada’s provincial and federal government debt has ballooned during the COVID-19 pandemic, as it has for governments around the world, as they cope with both the costs of
a health emergency and the need to use taxpayer dollars to prop up their economies.
But in Canada, some of the new public spending will settle at a permanently higher level or resume an upward trend once life goes back to normal, some economists say.
Read more: How Canada’s federal budget affects benefits, taxes, and the minimum wage
In Ottawa, the 2021 federal budget is eyeing a slew of new measures — from a national childcare system to revamping the outdated Employment Insurance program and a bump in Old Age Security benefits — that go far beyond a temporary increase in federal outlays to carry the country through the last months of the pandemic and restart the economy.
“Budget 2021’s ambition goes far beyond these targeted efforts to boost the recovery,” RBC economist Josh Nye writes in a recent report. “The government is significantly increasing transfers to older Canadians and lower-income workers.” And that, he notes, would mean permanently higher spending.”
And at the provincial level, healthcare costs were ballooning even before the pandemic — a trend that economists say will likely continue even after the battle against COVID-19 is over.
So does that mean Canadians should expect tax increases once the economy is back on solid enough footing?
That depends on who you ask.
For Bill Robson, CEO of the C.D. Howe Institute, higher taxes are “implicit” in the 2021 federal budget.
A first analysis by the Institute of Ottawa’s latest spending roadmap suggests “we’re really on a knife’s edge here,” Robson says.
“If they’re lucky with interest rates, if they’re lucky with economic growth rates, then (we’ll) probably have a stable debt ratio,” he adds.
With federal deficits of $354 billion for 2020-21 and expected at $155 billion for 2021-22, and more than $50 billion for the following two years, the size of the federal debt is set to hover around 50 per cent of GDP until at least 2025-26, according to current budget projections.
Read more: Post-COVID-19 Canada: What the federal budget tells us about the end of the pandemic
But that ratio could creep higher if borrowing costs increase or the economy hits a rough patch, Robson says.
The few revenue-raising measures introduced by the budget — such as a new luxury tax on high-end cars, yachts and private aircraft — won’t count for much in the federal government’s balance sheet, Robson predicts.
And there was no mention in Ottawa’s 739-page budget of increasing the goods and services tax (GST), a move the C.D. Howe Institute has been advocating for.
A hike in the GST rate, which has been sitting at five per cent since 2008, would be an effective way to boost revenues, Robson argues.
“A lot of economists would like to see higher GST instead of other taxes because it is such a broad and robust tax base that doesn’t discourage people from working as badly as personal income taxes do,” Robson says.
And higher sales taxes also don’t tend to drive business out of Canada to the same degree that corporate tax hikes do, he adds.
Still, if Ottawa was pondering raising the GST, the right time to do it would likely be sometime in 2023, when the economy is back on its feet and Canadians who’ve been benefitting from the government’s COVID-19 emergency income supports will be in a better financial position to pay, Robson says.
Mostafa Askari, chief economist at the University of Ottawa’s Institute of Fiscal Studies and Democracy (IFSD), on the other hand, doesn’t see federal tax hikes as inevitable based on the latest spending patterns laid out by Ottawa.
Read more: Budget 2021: What’s missing as feds say no to new GST hike, universal basic income
Askari’s analysis of the latest federal budget shows that, barring significant interest rate increases or a long-term slowdown in economic growth, “what you will see is that the debt-to-GDP ratio actually starts to decline gradually over time.” And that, he adds, “is what we call a sustainable fiscal structure or fiscal policy.”
That’s because about 60 per cent of the federal government’s spending is currently based on formulas that ensure those outlays grow as fast or slower than GDP. Social transfer to other levels of government, for example, are capped at three per cent a year, while Canada’s long-run GDP growth trend (including inflation) is around four per cent per year, Askari says. The Canada Health Transfer and equalization payments are also linked to GDP growth, which ensures they won’t expand faster than the economy.
While the budget presented by Finance Minister Chrystia Freeland would dial up permanent spending, it stops short of setting Canada on an inevitable path of expenses growing faster than GDP, Askari says. Notably, Ottawa resisted provincial calls to boost health transfers, he adds.
Read more: Liberals eye ‘lost generation’ risk with sweeping COVID-19 recovery plan
Still, the federal government’s fiscal position is becoming more vulnerable to changes in underlying conditions like interest rates, Askari says. Interest rates rising by two percentage points or more over the next four or five years, for example, could mean that Canada’s debt-to-GDP ratio may not actually shrink over time, he warns.
But it’s in some of the provincial government coffers that Askari sees the most serious fiscal strains. Healthcare spending, which makes up about 40 per cent of provincial budgets on average, will keep growing fast even after the pandemic is in the rearview mirror, due in large part to the ever-rising costs of new drugs and treatments as well as the needs of Canada’s aging population, he says.
That’s why Askari sees room for sales tax increases at the provincial level.
For example, a provincial sales tax — however, unsavoury politically — would “significantly” help in Alberta, where provincial debt remains relatively small compared to the size of the provincial economy but the debt-to-GDP ratio keeps rising.
An increase in net debt to $82 billion this year will leave Alberta’s net debt to GDP ratio at 24.5 per cent. But continued deficits are set to push that to 26.6 per cent by 2023-2024, according to the province’s 2021 budget projections.
But both Askari and Robson singled out Newfoundland and Labrador as facing an especially daunting fiscal picture. Like Alberta, the province has been facing the twin challenges of COVID-19 coupled with uncertainty in the oil market. But the province’s greatest fiscal woe comes from its demographic makeup, Askari and Robson say.
“They have a huge problem and the aging population,” with healthcare costs set to balloon, Askari says.
Higher sales taxes would be an easy-to-implement and effective way to beef up government revenues, Askari says. But they are considered a somewhat regressive form of taxation, one that hits low-income households harder than higher-income ones, he notes.
Still, without an increase in revenues or a boost to economic growth, there’s a risk one or more of Canada’s provinces may need Ottawa to come to the financial rescue, Robson warns.
“I would much prefer to see the federal government leave more fiscal room for the provinces by not getting so big itself,” he says.
———————————————————————-
Tuesday, April 20, 2021 5:20 PM
pm@pm.gc.ca premier@gov.bc.ca
Fudget Budgets…
PM, Premier of BC, The Ministers of Finance’s budgets left out …
The governments should have increased the senior’s supplement by the same amount welfare and disability persons are to receive, otherwise how will it be possible for seniors’ to make ends meet?
Reconsidering the federal government’s budget that didn’t increase all seniors’ Old Age Security payments 10%, that was only increased for those 75 years of age and older, what about those 65 – 74 years of age? The cost of living and surviving high costs will still have these seniors bin diving to supplement their bare breakfast, lunch and dinner plates, same old meal replacement therapies, dog/cat food?
Sincerely Canadian
C. M. B.
P.S. Premier, you promised us an ANNUAL (YEARLY) $400 RENT REBATE! Where’s that “beef”?
———————————————————
April 20, 2021
NEWS RELEASE
Budget 2021 supports people now while building the foundation for strong recovery
VICTORIA — Budget 2021 focuses on protecting people’s health and livelihoods through the pandemic, while making investments in services, infrastructure and opportunities to support a strong recovery and a brighter future for everyone.
Budget 2021 addresses immediate challenges and builds the foundation for a strong recovery, with new investments in health and mental health services, business supports, affordable housing and child care, keeping life affordable for families, and record levels of job-creating community infrastructure.
“Through the adversity we have faced in the last year, we have witnessed the resilience of British Columbians time and again as communities rose to the challenge of COVID-19. As we continue to roll out the largest vaccination effort in our province’s history, we can see the light at the end of the tunnel,” said Selina Robinson, Minister of Finance. “We know a recovery won’t happen overnight, but by focusing on the things that matter most to people, we can ensure there are better days ahead for everyone.”
Better Health Care
- Keeping people safe during the pandemic with $900 million in new funding for testing, contact tracing, personal protective equipment and the largest vaccine rollout in B.C.’s history.
- Helping patients get faster access to surgeries and shorter wait times for diagnostic imaging.
- Better care for seniors, including thousands of new staff in long-term care facilities and improved home care.
- More mental health supports in schools, more Foundry centres, quadrupling the number of integrated child and youth support teams, and expanding the response to the overdose crisis — the largest investment in mental health and addictions services in B.C.’s history.
- Providing better care closer to home by building hospitals, including the new Surrey hospital and cancer centre, and new urgent and primary care centres in communities around B.C.
- Addressing systemic racism in health care and ensuring Indigenous peoples have access to culturally appropriate care.
Supporting People and Businesses
- Saving families up to $672 a year per child with free public transportation for children 12 and under.
- Making it easier to find affordable, quality child care by doubling the number of $10-a-day child care spaces, doubling the wage enhancement for early childhood educators, and continuing to build and expand spaces.
- Creating 400 more spaces through the Aboriginal Head Start program that provides culturally relevant child care for Indigenous families.
- Continuing to fund the BC Recovery Benefit, which has helped over 2.5 million British Columbians to date and provides up to $1,000 to families and single parents, and up to $500 for individuals.
- Helping 80,000 low-income seniors by increasing the Seniors Supplement for the first time ever.
- Helping those who are struggling most by delivering the largest ever permanent increase to income assistance and disability assistance rates, a 53% increase to income assistance since 2017.
- Supporting the resilience of B.C. businesses with a suite of grants and funding, some already introduced in response to urgent needs, to help businesses adapt and grow.
- Helping ensure tourism businesses and communities make it through the pandemic and are ready to thrive when visitors can safely return.
- Improving campgrounds and trails, while adding up to 100 new campsites throughout the province every year, starting in 2022.
Building the foundation for a strong economic recovery
-
Creating over 85,000 jobs and strengthening communities around B.C. with record infrastructure investments — an increase of $3.5 billion in this budget.
-
Helping thousands of people find new jobs in sectors like health care through investments in post-secondary education and skills training programs.
-
Ensuring more than 5,000 young people land jobs, internships and co-ops through the StrongerBC Future Leaders program, and 3,000 students benefit from new work integrated learning placements.
-
Building 9,000 new homes for middle-income families with $2 billion in development financing.
-
Supporting tourism businesses and communities with $120 million, including grants to help prepare for future visitors through new tourism infrastructure like trails and airport improvements.
-
Reducing emissions, protecting communities, expanding the economy and creating careers through an additional $506 million in CleanBC investments.
-
Making annual funding permanent to improve connectivity across B.C.
-
Helping high-potential businesses grow in B.C. through funding provided by InBC, a new $500-million strategic investment fund that will deliver economic, environmental and social returns.
“From the time the pandemic hit, we delivered a broad range of supports for British Columbians who were reeling from how quickly all of our lives were turned upside down,” Robinson said. “Budget 2021 is built from everything we have learned in the last year to continue helping people now, while laying the foundation for people and businesses in our province to seize the opportunities that recovery will offer.”
The world has changed dramatically since the Province released its last budget. B.C.’s real gross domestic product (GDP) is estimated to have declined by 5.3% in 2020. As the recovery continues, B.C.’s real GDP is forecast to grow by 4.4% in 2021 and 3.8% in 2022, reaching pre-pandemic levels by next year. A steadily declining deficit is projected over the next three years, beginning in 2021-22.
————————————————————————-
Sunday, April 18, 2021 9:26 pm
pm@pm.gc.ca
REGARDING: FUDGET BUDGET
PM and Minister of Finance
By that, why not remove reality from the illusionary? Forcing People and Family to negate reality and force to exist an illusionary existence… to ensure the illusion overtakes and undermines the uncontaminated new borne infant… force of the economic abortion ala con game…
For example denying that people are human beings and this psychotic system that has set “Us” up as a commodity? Corn on the cob… each corn kernel up for corporate exploitation: human nature, emotions, bodily functions, nervous system, mental health, physical health, family values….
Why not bring this psychotic system out of “re-tire-meant”? Forcing and squeeze-playing People and Families into and onto a corner-store shelf to await a sordid sorry state dictated by entities fail-proofed economic game-plan, how to make the most money come out of a machine the excuse all ready to enact on which ever human being is next up for grabs…
Remove People and Family from these fudget budget machinations that encase “Us” in the corporate cannibal, pork barrel… poverty paralysis ensures economic success granted through criminalities… what goes a round comes a round?
Covid-19 germ warfare, addictions to drugs, alcohol, then there’s money laundering and gambling. Not only gambling with the wellbeing and health, also, Canada’s Charter of Rights and Freedoms, Canada as a home for Canadians, yet there they are homeless penniless represent-less…
Foreign investors that have invested dirty money in dirty party favour-ites doing favours for graft. Without moral compasses, whether Liberal or Conservative Canada has been degraded through corrupted elected officials, the so-called “leaders” of our homeland that has been sold off to the cheapest of the global ‘trotters’.
No wonder the people don’t listen to the ‘leader’ or to the ‘health authorities’ be calm, be safe, be kind when there is no leader, only the followers of foreign favour-ites that have never ever considered “the human interest”!!!
Sincerely Canadian
C. M. B.
P.S. Rather than another “putrid“ tax money grab, initiate legislation to criminalize foreign ownership of Canadian properties better off known as born Canadians’ right to homes rather than kicking born long established Canadians to the curb then blaming them for being there?
++++++++++++++++++++++++++++++++++++++++++++++++++
Sunday, April 11, 2021 7:52 am
pm@pm.gc.ca
Basic Income To Eliminate Poverty ONLY By Half?
PM
While debating do consider the facts, not the preferential “treatments”…
The basic income must eliminate all poverty, to not do so is not acceptable, what precludes the “other half” from being lifted out of poverty?
Self serving “pricks”. Prostitution and access to violate children ensure slave labour? Perverts and pedophiles!
Mothers and children these children reach adulthood dysfunctional and have contributes that deserve acknowledgement and more than any billionaire!
Sincerely Canadian
C. M. B.
————————————————————–
Tuesday, April 20, 2021
With one budget, Freeland overturned 3 decades of political orthodoxy
Aaron Wherry 4 hours ago
© Sean Kilpatrick/The Canadian Press Prime Minister Justin Trudeau gives Finance Minister Chrystia Freeland the thumbs up after she delivers the federal budget in the House of Commons in Ottawa on Monday April 19, 2021.
Nearly seven years ago, a rookie politician surveyed the political landscape across the democratic world and saw the outlines of a new era.
“What we are seeing, in both Western Europe and North America, is the end of the Reagan/Thatcher era and of the political ideas that created it,” Chrystia Freeland wrote at the time.
While in power, U.S. President Ronald Reagan and U.K. Prime Minister Margaret Thatcher personified an anti government agenda that prioritized cutting taxes, repealing regulation, shrinking the state and deferring to the market. For nearly three decades that agenda held sway in the West, reining in the governing visions of even liberal politicians.
But in July 2014, Freeland was arguing that the Western world was on the cusp of what she called a “new tectonic political shift” requiring a change in thinking by and about government.
Back then, Freeland — Justin Trudeau’s first star recruit — had been an MP for just eight months. Now she’s a finance minister staring down the painful endgame of a global pandemic and the unpredictable future that will follow it.
The budget she tabled on Monday is about dealing with the immediate threat of COVID-19 and then repairing and revitalizing the economy with an eye to the future. But it can also be read as a document that nudges the federal government and the political debate further away from the thinking of Reagan and Thatcher (and, in the Canadian context, Stephen Harper).
Permanent spending changes things
The budget proposes $135 billion in new spending over the next five fiscal years, most of which will be spent over the next three years to deal with the impact of the pandemic and to stimulate the economy as the virus recedes.
But there is significant permanent spending here too: for fiscal 2025-2026 — which is as far ahead as this budget looks — Freeland has budgeted for $16.1 billion in new federal spending.
More than half of that — $8.4 billion — would go toward early learning and child care, matching almost exactly what advocates had said would be necessary to deal with a lack of high-quality, affordable spaces.
But the budget also offers new and substantial sums for Old Age Security ($3 billion), public transit ($2.6 billion) and measures related to climate change and the environment ($1.9 billion). Expanding access to the Canada Workers Benefit — a refundable tax credit that supports low-income earners — would cost an additional $1.7 billion; Freeland says that could lift 100,000 people out of poverty.
Back in 2014, Freeland said that the Reagan-Thatcher revolution grew from the idea that “an overgrown, inflexible welfare state” could be blamed for a sluggish economy and high inflation. But the key problems of the modern economy, she argued — low economic growth and high economic inequality — can be traced back to a lack of government action.
“If too much government was deemed the problem of the earlier era of stagflation, it is easier to argue today that the problem is too little of it — too little stimulus, too little oversight, too little redistribution,” she wrote.
Seven years later, that looks like foreshadowing.
The government grows, the government shrinks
The Trudeau government was elected on a promise to spend more and do more. It has done dozens of things that the Harper government wouldn’t have over the last six years (and some things which Trudeau might wish he hadn’t done). But a few numbers also might quantify the broader change.
In 1992-1993, at the end of Brian Mulroney’s time as prime minister, the ratio of federal program expenses to GDP was 17 per cent — down from 18.3 per cent in the last year of Pierre Trudeau’s government — while revenue was 17.3 per cent.
By 2014-2015, the last full fiscal year of Stephen Harper’s government, federal spending had fallen to 12.5 per cent. Revenues were 14.0 per cent of GDP.
Before the pandemic, the Trudeau Liberals had pushed those numbers back to 14.1 per cent and 14.9 per cent. With this new budget, Freeland foresees spending reaching 14.9 per cent in 2025-2026 and revenues totalling 15.3 per cent.
That’s not quite the return of “big government,” but it’s several steps removed from the vision of Reagan, Thatcher and Harper. And that change of direction is now demonstrated by a commitment to dramatically increase the federal government’s involvement in child care — to spend federal resources and work with provinces to expand a vital social program.
It shouldn’t be forgotten that Harper came to office with a promise to scrap the previous Liberal government’s plans for a national child care program.
Those on the political left might argue this isn’t actually enough. And they might have a good case. The Trudeau government has shelved discussions about increasing health transfers to the provinces and Freeland’s budget offers nothing new toward fulfilling the Liberals’ promise of a pharmacare program. A new federal-provincial deal that includes funds for long term care could add billions to annual federal government spending.
Those on the right might arguet hat it’s all too much. As long as the federal government is forecasting a deficit, it will be challenged to make the case that what it’s doing is affordable. Even with debt servicing costs at near-historic lows — projected at 1.4 per cent of GDP in 2025-2026, compared to 5.8 per cent in 1992-1993 — there will be some fretting about what might happen if interest rates rise in the future, or if there’s another economic shock soon.
Maybe Freeland still sees a need to break away from the neo-liberal orthodoxy of the 1980s and onward, but she might also want to leave behind a fiscally credible government. The alternative would only make it easier to usher in a new era of anti-government politics down the road.
But an election almost certainly will occur long before anyone knows how the current fiscal situation plays out. The Liberals might be happy with the contrast now forming with Conservative leader Erin O’Toole — who responded to the budget by saying that the nation’s finances are out of control and suggesting he would prioritize cutting taxes right now.
Reagan and Thatcher are ancient references now, but the pandemic might have emboldened those who, like Freeland, believe the time for a different approach has arrived. And Freeland has now delivered a budget that follows on the arguments she made in 2014. That could set us up for a pivotal debate about the kind of government Canada needs now to deal with the problems of today.
+++++++++++++++++++++++++++++++++++++++++++++++
CANADA
Budget 2021: What’s missing as feds say no to new GST hike, universal basic income
By Rachel Gilmore Global News
Posted April 19, 2021 1:07 pm
Updated April 19, 2021 2:36 pm
The Liberal government has laid out billions in fresh spending after over two years without a federal budget — and while many of the government’s recent pledges graced its pages, others were notably absent.
It’s possible some policies were pushed out of reach as COVID-19 variants sent a third wave hurtling through Canada, forcing the government to refocus its priorities onto more immediate relief measures, according to one economist.
READ MORE: Liberals eye ‘lost generation’ risk with sweeping COVID-19 recovery plan
“They left a lot of things out of this budget that I think were being kicked around, bandied about before the budget,” said Sahir Khan, executive vice president of the University of Ottawa’s Institute of Fiscal Studies and Democracy.
“With the increasing (COVID-19 third wave) pressures, there was really only an opportunity for a couple of signature measures.”
Budget 2021: Feds to invest $2.2B in homegrown vaccine manufacturing
Global News dug into a few of the measures that had a lot of hype before the budget — but didn’t make it onto its pages.
No capital gains tax on principal residences
One term that was notably absent from the entire budget document was “capital gains tax,” which some speculators had suggested could be tacked onto primary residence sales in the new budget.
Capital gains are the taxes paid when an investment, like a stock or a mutual fund, are sold. As things stand now, 50 per cent of the earnings on these investments are taxed as income. So if you buy a stock at $10 and sell it for $20, you’d have to add five dollars under your income tax filings. The sale of primary residences are currently exempt from capital gains taxes.
READ MORE: Canada’s debt set to cross $1 trillion mark as Liberals extend COVID-19 aid in budget
However, Canadians currently have to pay capital gains tax on the sale of any secondary residences. But as prospective buyers look down the barrel of a white-hot real estate market, the idea of slapping a capital gains tax on primary residences has been floated as a potential method of cooling things down.
The political strategy of Canada’s pandemic spending plan – Nov 30, 2020
If imposed, anyone selling a house in Canada would have faced capital gains tax on the profits they make from the sale.
However, the Liberal government shied away from the prospect in its new budget, allaying the fears of Canadians who hold a massive portion of their equity in their homes — for now.
READ MORE: Three ways Ottawa could cool the housing market in the federal budget
The budget doesn’t leave the issue of the hot housing market entirely untouched. Any homeowners who aren’t Canadian citizens or permanent residents are set to face an annual tax of one per cent the total value of their real estate starting in 2022, provided that property is considered vacant or underused.
No Universal Basic Income
The budget is also turning its back on the overwhelming endorsement of a Universal Basic Income (UBI) that emerged at the Liberal policy convention in early April.
At the party’s virtual convention just over a week ago, the resolution — which was co-sponsored by the Liberal caucus — passed by a vote 491-85.
READ MORE: Federal budget delivers big promises on childcare, tamer housing measures
The budget document, however, makes no mention of the popular policy.
UBI is a benefit that would see the federal government provide Canadians with a minimum amount of earnings — with no strings attached. While the Parliamentary Budget Officer said in a recent report that the program could chop Canada’s poverty rates in half by 2022, it would come with a steep price tag: an estimated $85 billion this fiscal year, rising to over $93 billion by 2026.
Looking at a basic income in Canada – Apr 12, 2021
Prime Minister Justin Trudeau had previously signalled his lack of enthusiasm for UBI, stating that the costly program is not at the top of his list amid the COVID-19 pandemic.
“Obviously COVID has exposed weaknesses in our country where vulnerable people are continuing to slip through the cracks,” he told reporters when pressed about the program in recent weeks.
“We will have conversations about next steps as well but our focus is very much on what we need to do to control COVID-19.”
Trudeau’s sentiment transferred into the budget document, which makes no mention of the program.
No wealth tax
The Liberal government will need the support of at least one other political party in order to pass its budget bill and avoid a federal election. But a key ask from the NDP is missing from the budget document: a wealth tax.
The federal NDP has been pushing for a wealth tax throughout the pandemic, pointing out on their website that “Canada’s richest CEOs earn more than 200 times the average income of Canadian workers.”
“Closing tax loopholes and shutting down tax havens would save Canadians more than $16 billion every year,” the NDP website reads.
“And our 1% wealth tax on people with over $20 million would ask the very richest people to pay a little bit more. That’s money we could use to build a fair and just economy – one where Canadians aren’t struggling just to make ends meet.”
READ MORE: U.S. billionaires richer by $434 billion since coronavirus pandemic began: report
However, NDP Leader Jagmeet Singh said he didn’t find his ask fulfilled anywhere in the budget.
“They have not put in any significant measures to address the fact that the ultra-rich in Canada have seen not just profits, not just getting by, but record profits in this pandemic,” Singh said, reacting to the budget Monday evening.
“There’s no measure in this budget…to say that it should be the ultra-rich who pair their fair share.”
The Liberals did lay out some policies, however, that will hit the pocketbooks of Canada’s wealthy. The budget proposes to introduce a tax on select luxury goods — including on the sales of luxury cars and personal aircrafts over $100,000 and boats, for personal use, over $250,000.
“It is estimated that this measure will increase federal revenues by $604 million over five years, starting in 2021-22,” the budget read.
No new pharmacare funds
Trudeau has previously promised to implement a national pharmacare program, but so far, the government has only taken incremental steps in that direction.
Onlookers hoping to see that change in the new budget will not be greeted with good news.
Coronavirus: NDP Leader Jagmeet Singh says COVID-19 exposed problems, says action needed – Sep 23, 2020
The budget only mentions the word “pharmacare” four times, with a one-page section dedicated to the idea but with no new money on the table.
“The case for national universal pharmacare is well-established. The government is committed to work with provinces, territories and stakeholders to build on the foundational elements that are already in progress, like the national strategy on high-cost drugs for rare diseases, toward the goal of a universal national program,” the budget read.
READ MORE: Liberals approve pharmacare, basic income and long-term care standards during convention
It goes on to reiterate the government’s pledge to provide funding to the program for high-cost drugs for rare diseases, and to “directly engage with willing partners on national universal pharmacare.”
The Liberal government has been voicing this pledge since the 2019 budget.
However, no new funds or initiatives were announced, leaving the budget lacking in any significant new strides towards universal pharmacare. That’s another move that may alienate NDP support for the budget bill — suggesting an election could be on the horizon.
“Pharmacare was something (Trudeau) campaigned on, he introduced in the throne speech, and now in this budget, is completely abandoned,” Singh said.
No GST hikes
While think tanks suggested the Liberals could hike the GST rate in a bid to help pay for pandemic-related financial aid, the budget shows the governing party has opted not to take advantage of the potential revenue source.
“GST Rate Consumption taxes are the least distortive to economic growth and, considering Canada’s relatively low reliance on them among OECD countries, are a superior way to raise needed revenues,” wrote the Toronto-based C.D. Howe Institute in a paper it published ahead of the federal budget.
“In comparison with other revenue sources, consumption taxes such as GST do less harm to investment and growth than taxes on capital and personal income and are a more stable and reliable source of revenues.”
READ MORE: Basic income program could cut national poverty rates in half, PBO says
The report called on the federal government to boost the GST rate from five per cent to seven per cent — bringing it back to its pre-2006 levels.
However, the government didn’t include any GST hike in the federal budget, beyond mentioning some measures already laid out in the fall fiscal update. In that update, the government had laid out a number of changes to the GST/HST system to make sure it “applies in a fair and effective manner to the growing digital economy.”
While the budget reiterated those GST tweaks, it didn’t lay out any new hikes.
No increase in health transfers
The budget doesn’t provide any recurring boosts to provincial health transfers – a move that frustrated the Bloc Quebecois, which has repeatedly called on the federal government to do just that.
The budget reiterates its announcement from last month, when the federal government proposed to provide provinces and territories with a $4 billion, one-time top-up to the Canada Health Transfer.
It does not, however, lay out any long-term increases to the transfers — which is what the provinces have repeatedly called for. The $4-billion figure also falls far short of what the provinces had called for — the premiers have repeatedly demanded that the annual transfer to be increased by at least $28 billion a year, permanently.
Premiers call on Ottawa to increase Canada Health Transfer – Mar 5, 2021
When universal health care was first adopted, the cost was shared 50-50 between the federal government and the provinces. B.C. Premier John Horgan pointed out the fact in a March 4 press conference, during which he joined other premiers in calling for more funds.
Today, the federal government shoulders just 22 per cent of the cost of healthcare — and the premiers are calling on them to boost that figure to 35 per cent.
“Our public health-care system is at risk,” Horgan warned.
“COVID has brought (the challenge) into graphic light. It’s stark, it’s profound and we need to take action.”
READ MORE: Premiers reiterate demand for $28 billion increase in health transfers from Ottawa
The Bloc Quebecois has repeatedly brought the demand to the House of Commons. In a March 3 press conference, Bloc Quebecois Leader Yves-Francois Blanchet said his party would not back the budget without health transfers — making the missing budget measure a potential poison pill for the party’s support.
The Bloc’s conditions for supporting the budget were “well-known, and they have been for a long time,” said Blanchet during the press conference, adding that the conditions include “the increase, without conditions in the transfers…health transfers.”
“Those are conditions without which we will not vote in favour of the budget,” Blanchet said.
Speaking after the budget was tabled on Monday, Blanchet said that while there are “good things” in the budget, there are things that “disappoint,” too.
“The government will have a deficit which will go up to ($150 billion) without answering positively a request from all and each of the (premiers) in Canada about a transfer from healthcare,” he said.
Blanchet stopped short of saying he’d vote against the budget, stating instead that his party will use “each and every possible procedure” to try to amend the budget in the “coming days.”
— with files from The Canadian Press and Global News’ Erica Alini
© 2021 Global News, a division of Corus Entertainment Inc.
++++++++++++++++++++++++++++++++++++++++
+++++++++++++++++++++++++++++++++++++++++
Federal budget delivers big promises on childcare, tamer housing measures
Erica Alini
Monday, April 19, 2021
Canada’s 2021 budget delivers big promises to slash childcare fees but more timid measures to tackle the other major source of financial strain for young families: housing.
As widely anticipated, the creation of a Canada-wide early learning and childcare plan is the centerpiece of the first federal budget presented by Finance Minister Chrystia Freeland.
Ottawa is proposing up to $30 billion in fresh spending over the next five years to create a nationwide childcare system that it promises will bring childcare fees down to an average of $10 per day in regulated childcare centres by fiscal 2025-26.
Read more: Canada’s debt set to cross $1 trillion mark as Liberals extend COVID-19 aid in budget
That pledge may sound like music to the ears of parents who currently spend far more than that anywhere outside Quebec, where families pay as little as $8.35 for a subsidized childcare spot.
In much of the rest of Canada, childcare costs are often as large as mortgage payments. A 2021 study by the Canadian Centre for Policy Alternatives, for example, found that in 2020 families were paying median fees of more than $1,000 per month for a toddler childcare space in many of the country’s larger cities, such as Vancouver, Calgary and Ottawa, and more than $1,500 a month in Toronto.
When it comes to housing affordability, the 2021 budget shied away from big spending and sweeping promises. The Trudeau government moved ahead with a previously-telegraphed proposal to roll out a national tax on foreign-owned properties that are left vacant or under-occupied, a measure Ottawa says is intended to curb real estate speculation.
Read more: How Canada’s federal budget affects benefits, taxes, and the minimum wage
But in a housing market beset by crippling supply shortages, the budget announced funding for a mere 35,000 affordable units, with some of that money allocated to repairs of existing units rather than new construction.
Even the budget’s major commitment on childcare hinges largely on what will likely be a tricky implementation process, says Sahir Khan executive vice president of the Institute of Fiscal Studies and Democracy at the University of Ottawa.
“Childcare is going to take federal-provincial negotiations that are not going to be quick,” he says.
Ottawa says it’s ready to provide up to $27.2 billion over the next five years to bring federal spending on a national childcare system to a 50-50 split with provincial and territorial governments as part of an initial five-year agreement.
The goal is to reduce childcare fees by 50 per cent on average in regulated early learning centres everywhere other than Quebec by the end of 2022. By fiscal 2025-26, Ottawa envisions parents paying an average of just $10 per day across Canada.
Read more: Liberals set for deep dive into child care in upcoming federal budget
But the plan is contingent on half of the funding coming from the coffers of provincial and territorial governments, many of which were facing fiscal challenges, shortfalls and mounting healthcare bills even before the COVID-19 emergency.
The budget does not set a target for increasing the number of affordable childcare spaces, simply mentioning that the government is aiming for “ongoing annual growth.”
As well, Ottawa provided few details on before- and after-school care, saying it wants to see “meaningful progress” in improving and expanding those programs.
Read more: O’Toole urges need to get spending ‘back under control’ ahead of federal budget
Budget 2021 proposes a new, national tax on foreign-owned empty homes similar to measures already implemented in British Columbia and Ontario.
Homeowners who are not Canadian citizens or permanent residents would have to pay an annual tax of one per cent of the value of residential real estate that is considered to be vacant or underused. The measure includes a requirement for foreign owners to file a declaration on the current use of their property with “significant penalties for failure to file,” the budget reads.
The tax is expected to yield $700 million in additional revenues over four years starting in 2022-23, money Ottawa says will be used to improve housing affordability for Canadians.
Read more: Budget 2021: What’s missing as feds say no to new GST hike, universal basic income
Data on the role of foreign buyers in the housing market is typically scarce and usually available with a considerable time lag. However, housing experts previously interviewed by Global News said foreign real estate investors do not seem to have played a major role in the pandemic housing boom, which appears to have been largely driven by domestic end-users and speculators so far.
But some experts reckon even an empty-homes tax targeted narrowly at foreign buyers may send a chill through the housing market, curbing the “fear of missing out” mentality that has anecdotally gripped buyers in many parts of the country.
Still, Canada’s experience over the last several years suggests measures aimed at homebuyers tend to have only a temporary cooling effect on housing, with prices eventually resuming their upward climb.
Read more: Liberals eye ‘lost generation’ risk with sweeping COVID-19 recovery plan
To meaningfully improve housing affordability over the long term, many real estate experts have been advocating a significant and sustained increase in government support for new housing supply.
“Using natural market mechanisms to reduce the price of housing is probably the best way to do this, and the most sustainable way to do this,” Khan says.
“We need to figure out with all three orders of government, is there a way to increase the stock of quality housing, affordable housing for Canadians? That’s, I think, a bigger discussion.”
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Exclusive: Canada’s budget to include digital and luxury levies, but no wealth tax – sources
OTTAWA (Reuters) – Canada’s first budget in two years, to be presented to parliament on Monday, proposes a sales tax for online platforms and e-commerce warehouses, a digital services tax for Web giants and a luxury tax on items like yachts, government sources familiar with the document said.
It will not include a wealth tax, a levy sought by the opposition New Democrats. Liberal Prime Minister Justin Trudeau’s budget will need the support of at least one opposition group to pass.
“The government is not moving forward with a wealth tax right now,” a government source told Reuters. “We will be taking meaningful steps to close loopholes and tackle tax evasion, and ask those who are doing well right now to pay just a little bit more.”
The budget will include a sales tax for online platforms and e-commerce warehouses starting from July, and a digital services tax on big Web companies starting from Jan. 1, 2022, both measures originally promised last year.
Online platforms include foreign-based vendors with no physical presence in Canada that sell products such as mobile apps and online video gaming. E-commerce warehousing is the storage of physical goods before they are sold online.
A luxury tax on new cars and private aircraft valued at more than C$100,000 ($79,970) and boats worth over C$250,000 will come into force next year if the budget is passed. RVs and snowmobiles would be exempt.
With the country’s housing market booming, the government is proposing to tax vacant residential property owned by non-resident, non-Canadian owners from Jan. 1, 2022, sources said.
There will also be an effort to crack down on jurisdiction shopping by large, profitable companies that attempt to artificially lower their tax obligations in Canada, sources said.
From 2023, Canada will aim to limit the amount of excessive interest expenses that can be deducted from profit, although small businesses will be exempt.
In 2022 or 2023, the budget will propose limiting the ability of multinational companies to artificially construct arrangements among countries that end up lowering their tax rates in Canada.
The sources provided no details. Finance Minister Chrystia Freeland is due to present the budget on Monday at about 4 p.m. (2000 GMT).
Offering up her first budget since taking over as finance minister last year, Freeland has promised up to C$100 billion in stimulus over three years to “jump-start” an economic recovery in what is likely to be an election year.
Separately, the Toronto Star reported on Sunday that Canada would set aside C$12 billion in the budget to extend its main pandemic support measures as much of the country battles a virulent third wave of COVID-19 infections.
(Reporting by Steve Scherer; Editing by Peter Cooney)
++++++++++++++++++++++++++++++++++++++++++++++
Federal budget to commit more than $2B for child care, deficit not to exceed $400B: source
Peter Zimonjic, Chris Hall
Deputy Prime Minister and Minister of Finance Chrystia Freeland will deliver her first budget, and the country’s first in two years, on Monday.
Finance Minister Chrystia Freeland will deliver the Liberal government’s first budget in two years on Monday, laying out more than $2 billion for a national child-care program while keeping the federal deficit for the past year under the $400 billion mark, CBC News has learned.
A senior government source that spoke to CBC News Sunday — on the condition they not be named because they are not permitted to speak on the subject — said unlike the way some programs have been announced in past budgets, the forthcoming child-care announcement will not be about striking expert panels, undertaking further study or be entirely subject to negotiations with the provinces.
The initial investment will be in excess of the $2 billion a report by the federal finance committee recently said should be the starting point of any national child-care program, and will be enough to lay the foundations of a full-scale national system that puts both affordability and quality at its start.
The source said the program will be the centrepiece of the budget and will be crafted to help women quickly, which means Canadians should expect to see something tangible in the next year to 18 months.
The child-care investment plays into the federal government’s three key budget components, which include introducing measures that address critical needs in the short, medium and long term.
To deal with immediate concerns, the source said, the federal budget will acknowledge that pandemic financial supports are still needed and will not be cut off as the crisis drags on with the worsening third wave.
That information is roughly in line with reporting by the Toronto Star earlier Sunday that said Freeland will roll out a $12 billion extension to the Canada Emergency Wage Subsidy (CEWS) as well as the Canada Emergency Rent Subsidy and lockdown support — key programs that have helped keep small businesses afloat over the last year.
The Star also said that all of the “main pandemic support programs” will be extended until the fall.
Targeted supports coming, source says
The second component of the budget, the senior government source said, will include efforts targeted at supporting women, low-wage workers, students and those in essential jobs as the economy comes back.
Child care will be a big part of that, the source said, as will assistance targeted at small businesses.
As federal pandemic-related financial supports eventually begin winding down, they will be transitioned into something that is more targeted, the source told CBC News.
That information dovetails with reporting from The Toronto Star, which said Sunday the federal government intends to introduce a new program called the Canada Recovery Hiring Program.
Under the program, the Star reported, companies that have relied on the CEWS would instead be able to access up to $1,100 for each four-week period of a new employee’s term.
The third component of the budget will be focused on longer-term efforts that help reduce the deficit and set the stage for a sustainable recovery that addresses both climate change and the social inequalities laid bare by the pandemic.
“We want to give people the confidence that they can make decisions now so that they’re ready when the economy comes back,” the government source said.
The size of the deficit
The $70 to $100 billion the federal government said it will use to help stimulate the economy will not all be allocated in Monday’s budget but general direction of where that money is going will be included.
The federal government has faced criticism for the stimulus program it outlined in the fall economic update unveiled in November as being unnecessary in the face of what many expect to be a strong economic rebound as pent-up Canadians prepare to splash out once the pandemic peters away.
“While temporary stimulus of this magnitude would likely provide a significant boost to the Canadian economy, it would result in materially larger budgetary deficits and higher federal debt in the medium term,” a recent report by the Parliamentary Budget Officer (PBO) said.
That opinion was also expressed by the shadow budget put out by the C.D. Howe Institute, which said “fiscal stability” would be “jeopardized” by spending up to $100 billion on stimulus.
Despite that criticism, Environment Minister Jonathan Wilkinson told CBC chief political correspondent Rosemary Barton on Sunday that financial supports rolled out in 2008-09 were rolled back too quickly and that organizations such as the International Monetary Fund have warned Canada not to move away from investing in jobs and growth if it wants to get the economy fully firing again.
“Our view is aligned with our European colleagues which is; it’s important for us to invest in rebuilding an economy that’s still 300,000 jobs short of where we were before the pandemic,” he said on Rosemary Barton Live.
“Our intention is to move forward, to invest for jobs and growth, to rebuild this economy and ensure that Canada will be strong and prosperous as we move forward.”
The senior government source also said that the expected deficit for the past year will not exceed $400 billion and may be slightly lower than expected but refused to provide an exact figure.
The PBO estimated the deficit for the 2020-21 fiscal year stands at $363.4 billion, without including any of the stimulus spending. The C.D. Howe Institute, which also does not include stimulus spending, puts that number at $388.7 billion.
The fall economic statement put the deficit for the preceding year at $381.6 billion.
Regardless of the exact spending totals for the past year, bringing the federal government’s books back into balance will take time, and the source said Canadians should not expect to see major changes to the tax code — including the introduction of a wealth tax — geared toward paying that money back just yet.
Tax tweaks
Reuters reported late Sunday that there will, however, be some tax news in the budget — including the imposition of a sales tax for online platforms and e-commerce warehouses starting from July and a digital services tax on big web companies starting from Jan. 1, 2022.
Online platforms include foreign-based vendors with no physical presence in Canada that sell products such as mobile apps and online video gaming. Both measures were originally promised last year.
Reuters also reported that the budget will contain a tax on new cars and private aircraft valued at more than $100,000 and boats worth over $250,000. RVs and snowmobiles would be exempt.
The government is also planning to tax vacant residential property owned by non-resident, non-Canadian owners from Jan. 1, 2022, sources told Reuters.
You can watch full episodes of Rosemary Barton Live on CBC Gem, the CBC’s streaming service.
agogblog 