The 724-page Federal Budget is now officially public. This substantial document appropriately focuses on Canada’s COVID pandemic recovery, and an announced $10 a day daycare plan will likely receive the majority of media coverage in the coming days. With respect to MPC members and all Canadians, there will be a continuation of COVID supports for individuals and businesses for as long as is deemed necessary.
In her remarks today, Deputy Prime Minister and Finance Minister Chrystia Freeland reiterated the government’s commitment to support the middle class and those working hard to become part of it. MPC’s recommendations to government ahead of the budget were to work to address increasing home prices through a focus on new housing supply and to create policy frameworks that attempt to promote would-be owner occupiers of homes over speculative purchasers. The budget included modest provisions to address both points.
Firstly, the government will invest $2.5 billion over seven years into numerous housing initiatives, to be distributed through CMHC, and will “reallocate $1.3 billion in existing funding to speed up the construction, repair, or support of 35,000 affordable housing units.” The comments from Finance Canada can be found here.
Secondly, Budget 2021 announces the government's intention to implement a national, annual 1-per-cent tax on the value of non-resident, non-Canadian owned residential real estate that is considered to be vacant or underused, effective January 1, 2022. A consultation will be held in the coming months to assist government with the finer points of rules and implementation.
The full media release by Government of Canada on Budget 2021 can be found here
The original Budget 2021 documents can be found here
As you likely know, MPC has been discussing post-COVID economic measures for many months with policymakers. Our major advocacy event, MPC Hill Week, took place six weeks ago, where MPC met with over sixty parliamentarians. (MPC was recognized as being Ottawa’s busiest lobbyists for the month of February 2021.) We are confident our concerns and recommendations have been discussed between elected officials. Our continual focus has been on ensuring aspiring first-time homebuyers and the supply side issues in housing aren’t ignored in this budget and future policy discussions. They are essential to Canada’s economy.
While the measures announced today that impact the housing market may be moderate responses, MPC is supportive of these initiatives and will be engaging policymakers and fellow stakeholders in the coming weeks. We will keep MPC members informed throughout.