(OTTAWA) A senior government official has revealed that Treasury Secretary Chrystia Freeland will propose taxing company share buybacks in her economic statement on Thursday to encourage companies to invest in their operations and their workers in the country.
Updated yesterday at 6:20pm.
Nojoud Al Mallees The Canadian Press
The source spoke to The Canadian Press on condition of anonymity as she was not authorized to publicly discuss the contents of the government’s financial report.
The federal government’s fall economic statement released on Thursday is also expected to include Canada’s response to President Joe Biden’s Cut Inflation Act, which also imposed a 1% federal tax on corporate share buyouts.
German Environment Secretary Steven Guilbeault berated oil majors last week for their very limited investment in climate action, while massive gains attributed to inflation have allowed them to garnish shareholder wallets.
Oil giant Cenovus on Wednesday announced profits of $1.6 billion in the third quarter, up 192% from the same quarter last year. Cenovus also paid $659 million to shareholders through share repurchases during the quarter.
Speaking in Windsor, Ontario last month, Freeland said this fall’s economic statement will focus on the economic opportunities Canada is trying to seize going forward — an economy heavily reliant on “clean energy,” electric vehicles, battery manufacturing and critical Minerals aligned.
Secretary Freeland has already indicated that she will also focus on fiscal discipline while the Bank of Canada hikes interest rates to bring down inflation. However, she warned that the government cannot compensate all Canadians for the rising cost of living.
As Secretary Freeland is to release the autumn economic statement on Thursday, which will paint a portrait of federal public finances and Canada’s economy, opposition parties in the House of Commons have expressed their expectations.
In a letter to Minister Freeland on Sunday, Conservative leader Pierre Poilievre urged the government not to introduce new taxes and announce new spending unless it made further budget cuts.
New Democratic Party leader Jagmeet Singh has written to Prime Minister Justin Trudeau urging him to crack down on “corporate greed” and reform the EI program without delay.
The Bloc Québécois is also calling for labor insurance reform to make the system more accessible. In addition, Bloc members are calling for the Liberal government to provide “increased, predictable and unconditional funding” for the health care system and a 10 percent increase in old-age benefits from age 65 — not from age 75, as Ottawa mandated in July .
The bloc is also asking the government “to use federal funds more rationally” by forgoing spending such as interference with provincial jurisdictions and subsidies to oil companies, according to financial critic Gabriel Ste-Mary in a press release.