Carney hints at corporate tax breaks in week of heightened fears and tensions over Canadians’ economic future
Facing growing unrest amid a worsening trade war, Prime Minister Mark Carney hinted Thursday about possible corporate tax breaks in the federal budget on Nov. 4.
“This is a budget that is going to support generational investment in Canada, scaled investment [that] we haven’t seen for decades. And that will include a highly competitive tax system,” he said at a press conference.
The prime minister did not provide details. But he pointed out that his government cancelled a proposed change in capital gains taxation that would have caused some people to pay higher taxes on the sale of some assets. He also noted the government is well aware of the comparative rates of tax between Canada and other countries.
Meanwhile, the government announced Canadian businesses impacted by Canada’s countermeasures to U.S. tariffs would benefit from financial relief, including extended tariff exemptions, on Friday. This announcement comes as Canada’s economic, trade and domestic political picture continued to worsen in the absence of a breakthrough on tariffs in Ottawa’s negotiations with the Trump administration.
Carney’s commitment to rally Canadians in a unified strategy against U.S. trade barriers was in jeopardy as the U.S. again stepped up its tariff war and American carmaker Stellantis unexpectedly shifted a major investment to Illinois instead of Brampton, Ont.
An angry Doug Ford and labour leaders demanded that the federal government forgo its even-tempered discussions with Washington in favour of a return to tough retaliatory tariffs against U.S. imports.
But Carney brushed aside calls for a renewed get-tough approach on the grounds that trade talks with the Trump administration are at a critical stage.
“Right now with the Americans we are engaged in deep negotiations, intensive negotiations on several sectors of the Canadian economy — energy, aluminum and the steel sector,” he told reporters. “There are times to hit back and times to talk and right now is the time to talk.”
Dominic LeBlanc, the minister responsible for Canada-U.S. trade, Privy Council Clerk Michael Sabia and Kirsten Hillman, Ottawa’s chief negotiator, have been discussing trade issues almost daily with senior Trump administration officials since Carney’s visit with Trump last week.
Carney also said he has received reassurances that Stellantis has plans to continue production at its Brampton plant, but it will depend on the outcome of the upcoming renegotiation of the Canada-U.S.-Mexico trade agreement.
The prime minister is under increasing pressure to achieve a breakthrough with Trump to mitigate damage from tariffs and also provide more assistance to impacted Canadian industries and workers.
