Budget 2022
On April 7, 2022, Chrystia Freeland, Minister of Finance, unveiled the federal budget. While federal coffers took in $36.1 billion more this year than was expected, the budget includes little spending. Just $2.2 billion in new spending is planned for this year, and an average of $5.8 billion every year for the next five. Next, Parliament will debate and vote on the budget. Typically, if a government loses a vote on a budget motion, they’ve lost the confidence of the House. However, the recent agreement between the NDP and Liberals means government will survive and that Canadians won’t be headed to the polls anytime soon.
Of relevance to the aftermarket industry, Budget 2022 includes announcements on labour, small businesses, electric vehicles, and competition.
On labour, Budget 2022 proposes:
- To introduce a Labour Mobility Deduction. This would provide tax recognition on up to $4,000 per year in eligible travel and temporary relocation expenses to eligible tradespersons and apprentices. This measure would apply to the 2022 and subsequent taxation years.
- To provide $84.2 million over four years to double funding for the Union Training and Innovation Program (UTIP). UTIP has two streams. Stream 1 provides funding for investments in training equipment and Stream 2 supports innovation in apprenticeship.
On small businesses, Budget 2022 proposes:
- To more gradually phase out access to the small business tax rate; access to be fully phased out when taxable capital reaches $50 million, rather than $15 million.
On electric vehicles, Budget 2022 proposes:
- To put in place a sales mandate to ensure at least 20% of new light-duty vehicle sales will be zero-emission vehicles (ZEV) by 2026, 60% by 2030, and 100% by 2035.
- To provide $1.7 billion over five years to extend the federal program that provides consumers with financial incentives to purchase ZEVs. The program will also be broadened to support the purchase of more vehicle models, including more vans, trucks, and SUVs.
- To invest in large-scale urban and commercial ZEV charging and refuelling infrastructure.
On competition, Budget 2022 proposes:
- To introduce legislative amendments to the Competition Act as part of the modernization of the competition regime. Amendments will fix loopholes, tackle practices that are harmful to consumers, and adapt the law to today’s digital reality.
AIA Canada will continue to engage with government on each of these issues. We will also continue to advocate for the right to repair, an issue that will gain more traction as Minister Champagne recently announced that updating Canada’s privacy legislation is a top priority for government.