Achi news desk-
The federal government unveiled its 2024 budget on Tuesday, promising billions of dollars in new spending, offset by new revenue streams.
Before the document was released, the Liberals committed to delivering unconventional communications, selectively announcing many of the larger line items in the weeks leading up to what they signed would be a budget aimed at “generational equity. “
Vowing not to grow the deficit while maintaining other fiscal guardrails, ministers have faced questions in recent weeks about how they plan to pay for new measures announced in the budget, and whether they would propose new or higher taxes to wealthier Canadians or corporate Canadians. .
From plans to boost new housing stock, encourage small businesses, and increase taxes on Canada’s top earners, CTVNews.ca has sifted through the 416-page budget to find out what will make the biggest difference to your pocketbook.
Are you hoping to buy a home?
Before the budget was officially released, the federal government had teased that the document would be heavily focused on housing and increasing supply, including billions of dollars in measures that have now been announced, and had stitched together in a “plan to solve the housing crisis. ,” that was revealed last Friday.
According to the budget, the Liberals are setting out “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 house prices more affordable is to increase supply – and quickly,” the budget reads.
Some of those measures include a plan to convert public lands into housing, a new Canada Housing Infrastructure Fund, and an addition 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.
In terms of shorter-term measures included in the budget, amortization of 30-year mortgages for first-time home buyers buying new builds will be available from 1 August 2024. And from Tuesday, there will be an increase to the Home Buyers’ Plan, from $35,000 to $60,000, allowing first-time home buyers to withdraw more from their RRSP and put a larger down payment.
Measures aimed at helping renters are also outlined in the budget.
Those include a Canadian Tenants Bill of Rights — which is subject to provincial and territorial support — although a timetable for the policy measure has not been specified in the budget document.
The federal government also plans to call ahead and “set a firm expectation” with “banks, fintechs, credit bureaus, and landlords,” to allow renters to earn credit for one-time rent payments, which the Liberals say they could “( do) it’s easier to get a mortgage, and maybe even at a lower rate.”
However, there is no legal obligation on those banks, landlords and credit bureaus to do so.
Are you among Canada’s top earners?
Leading up to budget day, experts warned the federal government would need a way to bring in extra revenue to help pay for some of its new spending, and there was speculation it could include a wealth tax, something the Finance Minister Chrystia Freeland dismisses it. .
Instead of a wealth tax, however, the budget includes plans to increase the capital gains inclusion rate — the portion of capital gains that are taxed — for less than one per cent of Canada’s top earners.
That means, on 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 of corporations and trusts.
The change makes a simpler calculation at tax time, increasing the proportion of capital gains that is taxed, rather than determining how much someone is worth and then taxing the richest.
This change will also apply to about 12 percent of Canadian corporations, according to the budget.
For the vast majority of people—99.87 percent of Canadians, according to the government’s census—there will be no increase to personal income taxes on capital gains.
Are you a small business owner or entrepreneur?
Included in the budget are measures aimed at helping existing small and medium-sized businesses to grow, as well as kick-start new initiatives.
In particular, the federal government unveiled Canada’s new Carbon Refund for Small Businesses, which it says will “urgently return profits from the price of pollution” to businesses with fewer than 500 employees.
The retroactive refund, from 2019-20 to 2023-24, will apply to an estimated 600,000 businesses in the form of an “automatic, directly refundable tax credit for eligible businesses” where the federal reserve is relevant.
The finance minister will specify the amount of the refund payments later, according to the budget.
The Liberals are also earmarking $200 million over two years, starting in 2026-27, to increase venture capital available for “deserving entrepreneurs” of certain new businesses.
And an additional 6,250 businesses owned by young Canadians 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 farming and fishing property, coming into force on 25 June 2024.
Are you a post-secondary student?
To help post-secondary students pay for school, the federal government plans to boost existing grants and interest-free loans, up to an additional $1.1 billion this year.
The Liberals estimate that the extension of increased grants and more interest-free loans will help support more than 1.2 million students together.
The budget also details plans to help students afford a place to live by changing the formula to calculate financial aid eligibility.
Moving forward, an updated formula used by the Canadian Student Financial Aid Program will factor in the cost of housing when determining financial need and funding eligibility.
“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 on the construction of new student residences at some post-secondary institutions, in the same way as was announced last year on purpose-built rental housing. According to the budget, they hope that removing the GST on some residences will incentivize the construction of new student housing, a measure with an expected price tag of $19 million over five years, starting this year, and $5 million a year thereafter .
“Building more student housing is good for young people, and makes sure there is a fair rental market for everyone,” the budget reads.
Do you have school age children?
The budget includes measures to help cover some of the cost of raising children.
Namely, it marks the money previously announced for a new school food 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 up to $800 a year for the average participating family with two children.
The federal government also aims to make childcare more affordable, namely by increasing the number of places available.
The new Childcare Expansion Loan Program, up to $1 billion, will provide loans and grants to build or renovate childcare centres, and changes to the Canada Student Financial Assistance Act and the Canada Student Loans Act will expand loan forgiveness eligibility for some early childhood educators.
According to the budget, all states and territories are on track to achieve $10 a day childcare, but the document does not specify by what date.
Do you have a disability?
The Liberals have finally put funding behind their long-promised Canada Disability Benefit: $6.1 billion over six years and $1.4 billion continuously.
They frame 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 insurance for the cost of medical forms needed to apply for this financial support.
The federal government is also proposing to expand the Disability Assistance Deduction – which allows some people with disabilities to deduct certain expenses – to include new costs covered under the program.
Namely, the Disability Support Deduction could include, subject to certain conditions: the cost of an ergonomic work chair, the cost of a bed positioning device, the cost of a navigation device for low vision, and the cost of memory or organization aids, among other accommodations.
Also included among the new healthcare funding is $1.5 billion over five years to launch the new national pharmacare plan. The first step, as previously announced, will help cover diabetes and contraceptive medications.
With files from CTVNews.ca Senior Digital Parliamentary Correspondent Rachel Aiello
