Finance Minister François-Philippe Champagne says the federal government’s upcoming budget will include measures aimed at simplifying taxes and reducing administrative challenges for Canada’s small- and medium-sized businesses.
Speaking at the Canadian Club Toronto on Monday, Champagne offered business leaders an early look at the Liberal government’s fiscal priorities ahead of the November 5 budget, the second under Prime Minister Mark Carney.
The budget is expected to focus on strengthening Canada’s domestic economy, encouraging private investment and reducing the country’s economic dependence on the United States.
During a discussion with the media following his speech, Champagne acknowledged that Canada’s complicated tax system can discourage smaller businesses from making investments.
He noted that numerous specialized tax provisions can be difficult for business owners to navigate without professional financial advice.
Champagne indicated that Thursday’s budget would begin addressing some of these challenges by introducing measures to simplify the system and make it easier for smaller enterprises to operate and expand.
The Canadian Federation of Independent Business (CFIB) has urged Ottawa to reduce the small business tax rate and address shortcomings in federal tariff relief programs that prevent some smaller companies from accessing assistance.
In an October 29 statement, CFIB executive vice-president of advocacy Corinne Pohlmann emphasized that small businesses need broad economic policies that encourage reinvestment and long-term planning rather than direct financial assistance.
She also stressed the importance of supporting small enterprises alongside the government’s major infrastructure and investment initiatives.
Although Champagne declined to reveal specific budget measures, he suggested that additional reforms to the Scientific Research and Experimental Development program could be under consideration. The program provides incentives for businesses investing in research, innovation and technological development.
A central component of the government’s economic strategy is the productivity mega-deduction, announced in September and projected to cost approximately $36 billion over five years.
The measure would allow businesses to deduct the full cost of eligible capital investments in the first year instead of spreading those deductions over several years.
Ottawa believes the incentive will encourage companies to purchase new equipment, adopt advanced technologies and improve workforce productivity.
Champagne emphasized that the initiative is designed to benefit businesses of all sizes, from major corporations investing in large infrastructure projects to neighbourhood cafes purchasing new equipment.
The finance minister also highlighted the government’s broader ambition to attract $1 trillion in private investment over the next five years.
Since Carney assumed office, the Liberal government’s fiscal approach has increasingly emphasized capital investment, infrastructure development and major economic projects rather than routine government spending.
Champagne said the strategy is intended to strengthen Canada’s productive capacity, improve competitiveness and diversify international trade relationships.
However, he provided no additional details about the government’s proposed sovereign wealth fund or plans to encourage private investment in Canadian airports.
When questioned about whether renewed trade negotiations with the United States could influence Ottawa’s spending priorities, Champagne maintained that the government’s economic strategy is focused primarily on strengthening Canada’s own capabilities.
He reiterated that the central objective is to rebuild Canada’s capacity to invest, produce and grow independently.
