It’s now up to the federal Liberal government to sell a spending plan it says will help younger Canadians catch up to their elders.
So far, if unsurprisingly, their critics and political rivals are unimpressed.
The $535-billion budget seeks to restore economic fairness for millennials and gen-Z voters at a time when the minority government is ailing in the polls.
It includes $8.5 billion over five years to help build millions of homes and another $2.6 billion for student aid and grant programs.
And it commits funding to the first phase of national pharmacare and promises federal standards for long-term care — two commitments the Liberals made to the NDP.
But New Democrat Leader Jagmeet Singh isn’t in a hurry to say if his party will vote to support the budget and keep the minority Liberals in power.
The Liberals have watched their once-healthy voting base among young people evaporate in favour of the Conservatives, largely as younger Canadians feel like the economic deck is stacked against them.
Freeland denied Tuesday that her latest budget is mainly a political exercise — but nonetheless acknowledged that for anyone under 40 in Canada, it’s “just harder to establish yourself” than it was for the generations that came before.
A middle-class income and a good job is no longer enough to feel economically secure, she said.
“It really isn’t fair what they are struggling with right now,” Freeland told a news conference Tuesday before her budget speech.
The 2024 budget is designed to fix that problem, she said —to “unlock the door to the middle class” for more Canadians.
“We are acting today to ensure fairness for every generation.”
Overall, the budget’s projected spending will rise to $535 billion in 2024-25, compared with $497.5 billion in 2023-24. The deficit is projected at $39.8 billion, compared with $40 billion last year.
There is $11.5 billion in new spending this year and $53 billion over the next five years.
Freeland said she is maintaining the fiscal anchors she set for the government, keeping the deficit below $40 billion and to less than one per cent of GDP starting in 2026-27.
Ottawa is paying for some of that with better-than-expected economic growth, but also with targeted changes to the capital gains tax that are expected to raise more than $19 billion over the next five years.
Currently Canadians only pay taxes on 50 per cent of the money they make from capital gains, which refers mainly to profits made from selling an asset like a stock.
Freeland is adjusting that to 66 per cent for all capital gains made by corporations and trusts, and for those that exceed $250,000 for individuals.
She said the change should affect 0.13 per cent of Canadians who have an average annual income of $1.4 million. She said she knows the tax increase will generate blowback.
“But before they complain too bitterly, I would like Canada’s one per cent — Canada’s 0.1 per cent — to consider this: what kind of Canada do you want to live in,” she asked in her speech.
Conservative Leader Pierre Poilievre left little doubt Tuesday about how his party felt about the budget, which he described as “a pyromaniac spraying gas on the inflationary fire.”
Bloc Québécois Leader Yves-François Blanchet also said his caucus would not support the budget.
This report by The Canadian Press was first published April 17, 2024.
