Economic Update: Reducing Deficits and Preparing for a Recession

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Economic Update: Reducing Deficits and Preparing for a Recession

Chrystia Freeland, Deputy Prime Minister and Minister of Finance of Canada.

Federal Minister of Finance, Chrystia Freeland, will table its economic update in the House of Commons late Thursday afternoon.

The 2022 Fall Economic Statement is primarily aimed at boosting investment in Canadian clean energy industries in response to new US tax incentives that were passed last summer.

The federal government's fiscal situation is better than expected, as inflation and a stronger economic recovery have boosted tax revenues.

After years of costly relief measures to deal with the COVID-19 pandemic, Ms Freeland is now expected to signal the need to cut deficits and prepare for an economic recession in 2023.

“This is an economic statement under the sign of fiscal responsibility,” said Liberal MP for Outremont Rachel Bendayan, Parliamentary Secretary for Tourism and Associate Minister for Finance.

Minister Freeland should not be doing more to help Canadians weather the cost of living crisis. In September, it offered $4.5 billion to temporarily double the GST rebate. The federal government also created a dental benefit for most children under 12 and offered a one-time $500 supplement to low-income renters.

Reimbursements for GST will start being deposited Friday into the bank accounts of 11 million low- and middle-income families. The Senate is still seized of the bill to create a dental benefit and an additional housing allowance.

The government has indicated that the mini-budget will be very modest and that x27;it would focus on targeted investments rather than large-scale new programs.

It will include a new tax on corporate stock buybacks to ;encourage companies to invest in their own operations and introduce new or improved tax incentives to encourage the growth of clean energy, including hydrogen.

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