'We recognize it's a very challenging time': Minister insists budget won't blunt innovation
Despite significant criticisms from business owners and entrepreneurs that parts of the federal government’s latest budget — specifically changes to taxes on capital gains — will stunt innovation, Small Business Minister Rechie Valdez insists it won’t.
“We recognize it's a very challenging time,” Valdez told CTV’s Question Period host Vassy Kapelos, in an interview airing Sunday.
She added that the goal of the latest budget is to “create fairness for every generation,” citing other budget priorities, namely building up housing stock.
“To be able to increase the cost of affordability in this country, we've introduced measures to help support small- and medium-sized businesses across the country,” she continued, pointing to changes to the lifetime capital gains exemption as an example.
Included in the newly tabled federal budget is a proposed change to the capital gains inclusion rate, which the government estimates will affect a narrow group of high-earning individuals and about 12 percent of corporations.
The Liberals plan to increase the taxable portion of capital gains from half to two-thirds for all corporations, and for individuals with a capital gains above $250,000. That tax increase is expected to generate $19.3 billion in revenue over the next five years.
But several Canadian business owners and entrepreneurs are warning that the change could blunt innovation.
Shortly after the budget was unveiled, Shopify president Harley Finkelstein took to X — formerly Twitter — to voice his concerns.
“Innovators and entrepreneurs will suffer and their success will be penalized — this is not a wealth tax, it's a tax on innovation and risk taking,” he wrote.
“At a time when our country is facing critically low productivity and business investment our political leaders are failing our country's entrepreneurs,” he added.
The heads of both the Council of Canadian Innovators and the Canadian Venture Capital and Private Equity Association have also issued similar warnings.
During a speech in Halifax last month, Bank of Canada Senior Deputy Governor Carolyn Rogers discussed Canada’s “productivity problem,” calling it “an emergency.”
She also cited Statistics Canada data showing that despite a “small gain” at the end of last year, the country has seen declining productivity for the last six straight quarters.
When pressed on why Canadians should trust the Liberals to incentivize innovation and productivity — especially at a time when a senior Bank of Canada official is calling the country’s low productivity level "an emergency" — Valdez said her party has implemented several measures to help small- and medium-sized businesses.
“We're going to continue to invest in our entrepreneurs across the country, and of course, make it a more inclusive environment for them to be able to do so,” she said.
When further pressed on the Liberals' record, considering the number of self-employed Canadians has been steadily declining since the beginning of the COVID-19 pandemic, Valdez didn’t directly address the statistic.
Valdez listed tax cuts for some businesses and initiatives to encourage women to enter the workforce, such as the $10-a-day childcare program.
“I've met with many small- and-medium sized businesses across this country, and I've had conversations with them,” Valdez said instead. “They are looking to start their business and we're trying to encourage, and be able to do so by different measures to create a more inclusive environment for entrepreneurs."
“So I do believe there is a lot of interest there,” she also said. “And we're going to continue to encourage and support small businesses across this country.”
With files from CTV’s Question Period Senior Producer Stephanie Ha
IN DEPTH
![](https://www.ctvnews.ca/polopoly_fs/1.6922467.1718138898!/httpImage/image.jpg_gen/derivatives/landscape_800/image.jpg)
'Not the result we wanted': Trudeau responds after surprise Conservative byelection win in Liberal stronghold
Conservative candidate Don Stewart winning the closely-watched Toronto-St. Paul's federal byelection, and delivering a stunning upset to Justin Trudeau's candidate Leslie Church in the long-time Liberal riding, has sent political shockwaves through both parties.
'We will go with the majority': Liberals slammed by opposition over proposal to delay next election
The federal Liberal government learned Friday it might have to retreat on a proposal within its electoral reform legislation to delay the next vote by one week, after all opposition parties came out to say they can't support it.
Budget 2024 prioritizes housing while taxing highest earners, deficit projected at $39.8B
In an effort to level the playing field for young people, in the 2024 federal budget, the government is targeting Canada's highest earners with new taxes in order to help offset billions in new spending to enhance the country's housing supply and social supports.
'One of the greatest': Former prime minister Brian Mulroney commemorated at state funeral
Prominent Canadians, political leaders, and family members remembered former prime minister and Progressive Conservative titan Brian Mulroney as an ambitious and compassionate nation-builder at his state funeral on Saturday.
Supports for passengers, farmers, artists: 7 bills from MPs and Senators to watch in 2024
When parliamentarians return to Ottawa in a few weeks to kick off the 2024 sitting, there are a few bills from MPs and senators that will be worth keeping an eye on, from a 'gutted' proposal to offer a carbon tax break to farmers, to an initiative aimed at improving Canada's DNA data bank.
Opinion
![](https://www.ctvnews.ca/polopoly_fs/1.6850735.1713368648!/httpImage/image.jpg_gen/derivatives/landscape_800/image.jpg)
opinion Don Martin: Gusher of Liberal spending won't put out the fire in this dumpster
A Hail Mary rehash of the greatest hits from the Trudeau government’s three-week travelling pony-show, the 2024 federal budget takes aim at reversing the party’s popularity plunge in the under-40 set, writes political columnist Don Martin. But will it work before the next election?
opinion Don Martin: The doctor Trudeau dumped has a prescription for better health care
Political columnist Don Martin sat down with former federal health minister Jane Philpott, who's on a crusade to help fix Canada's broken health care system, and who declined to take any shots at the prime minister who dumped her from caucus.
opinion Don Martin: Trudeau's seeking shelter from the housing storm he helped create
While Justin Trudeau's recent housing announcements are generally drawing praise from experts, political columnist Don Martin argues there shouldn’t be any standing ovations for a prime minister who helped caused the problem in the first place.
opinion Don Martin: Poilievre has the field to himself as he races across the country to big crowds
It came to pass on Thursday evening that the confidentially predictable failure of the Official Opposition non-confidence motion went down with 204 Liberal, BQ and NDP nays to 116 Conservative yeas. But forcing Canada into a federal election campaign was never the point.
opinion Don Martin: How a beer break may have doomed the carbon tax hike
When the Liberal government chopped a planned beer excise tax hike to two per cent from 4.5 per cent and froze future increases until after the next election, says political columnist Don Martin, it almost guaranteed a similar carbon tax move in the offing.
CTVNews.ca Top Stories
![](https://www.ctvnews.ca/polopoly_fs/1.6976926.1721883767!/httpImage/image.png_gen/derivatives/landscape_800/image.png)
AS IT HAPPENED Wildfire reaches Jasper Wednesday night, causes 'significant loss'
One of two wildfires threatening Jasper National Park reached the townsite Wednesday night and caused 'significant loss.'
Alberta calls in army to assist with wildfire situation
Alberta has called in the Canadian Armed Forces to help assist with the worsening wildfire situation in the province.
Biden explains why he ended re-election bid in Oval Office address
U.S. President Joe Biden on Wednesday delivered a solemn call to voters to defend the country's democracy as he laid out in an Oval Office address his decision to drop his bid for reelection and throw his support behind Vice President Kamala Harris.
Barrie-Innisfil MPP 'blacked-out' and crashed car into window of child care centre
Staff at a Barrie child care centre say they are frustrated by what they call a local MPP's inadequate response after a car crashed through a window in one of the toddler rooms.
Norad intercepts Russian and Chinese bombers operating together near Alaska in apparent first
The North American Aerospace Defence Command (Norad) intercepted two Russian and two Chinese bombers flying near Alaska Wednesday in what appears to be the first time the two countries have been intercepted while operating together.
2 Canadians being 'sent home immediately,' removed from Olympic team after drone incident
An analyst and an assistant coach with Canada Soccer are being removed from the Canadian Olympic Team and 'sent home immediately,' according to the Canadian Olympic Committee.
An unwelcome attendee has joined the Paris Olympic Games: COVID-19
After a handful of Australian water polo players tested positive for COVID-19 this week, questions have emerged around how the spread of the disease will be mitigated at the Summer Olympic Games in Paris.
Vacations, meals, booze: Contractor used $100K of charity's money for personal expenses, B.C. court finds
A B.C. man who was hired to help a non-profit build a food hub but instead spent the money on personal expenses – including travel, restaurants, booze and cannabis – has been ordered to pay more than $120,000 in damages.
Male, female killed, 2 others injured in 'gun battle' outside Toronto plaza: police
Two people are dead and two others suffered serious injuries following a shooting that police have described as a 'gun battle' outside a plaza in Scarborough, Ont. early Wednesday morning.
Local Spotlight
![](https://www.ctvnews.ca/polopoly_fs/1.6976054.1721842640!/httpImage/image.png_gen/derivatives/landscape_800/image.png)
Former First Nations chief voices Disney's first Ojibwe language Star Wars movie
A local First Nations elder and veteran is helping to bring the Ojibwe language to a well-known film for the first time.
Ottawa Humane Society reunites Montreal family with cat missing for 8 years
A cat who fled her Montreal home nearly a decade ago has been reunited with her family after being found in Ottawa.
Waterloo, Ont. woman out thousands after car totalled in hit-and-run
A woman in Waterloo, Ont. is out thousands of dollars for a car crash she wasn’t involved in.
'It looks scary, but they're harmless': Bees removed from Winnipeg street light
A swarm of bees living in a lamppost in Winnipeg’s Sage Creek neighbourhood has found a new home for its hive.
'Powerful symbol of the progress we have made': Land being returned to Manitoba Métis Federation
Around 100 acres of Manitoba Crown Land near the Saskatchewan border is being returned to the Métis community.
Cape Breton moose hunting suspended for 3 years due to 'significant' drop in population
Nova Scotia is suspending the licensed Cape Breton moose hunt for three years due to what the province is calling a “significant drop” in the population.
Social media prank could lead to charges after teens allegedly damage homes
A well-known childhood prank known as 'nicky nicky nine doors,' or 'ding dong ditch,' has escalated into a more serious game that could lead to charges for some Surrey, B.C. teens.
Benefit concert to be held for N.B. teen badly injured in 'freak accident'
It's been more than a month since their good friend was seriously hurt in an accident and two teens from Riverview, N.B., are still having a hard time dealing with it.
Here's what happens to rejected Halifax bridge coins
Halifax bridges have collected thousands of coins from around the world.