Ottawa would tax share buybacks to encourage investment in the country

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Ottawa would tax share buybacks to encourage investment in the country

The fall economic statement will be tabled in the Commons on Thursday.

A senior federal government official revealed that Finance Minister Chrystia Freeland will propose in her economic statement on Thursday to tax corporate stock buybacks, a practice that primarily benefits executives. Through this measure, Ottawa would like to encourage them to invest in their activities and the workers in the country.

The source spoke to The Canadian Press on condition of anonymity as she was not authorized to publicly discuss the contents of the government's financial update.

< p class="e-p">This federal government's Fall Economic Statement, released Thursday, is also expected to include Canada's response to President Joe Biden's Inflation Reduction Act, which included also a 1% federal tax on corporate stock redemptions.

Federal Environment Minister Steven Guilbeault lambasted oil companies last week for their very limited investments in climate action, while massive profits attributed to inflation allowed them to garnish the shareholders' portfolio.

Oil giant Cenovus on Wednesday announced third-quarter profits of $1.6 billion, up 192% from the same quarter a year ago. year. Cenovus also paid shareholders $659 million during the quarter through share buybacks.

Deputy Prime Minister and Finance Minister Chrystia Freeland

Speaking in Windsor, Ont., last month, Freeland said the Fall Economic Statement would focus on the economic opportunities Canada is trying to seize for the future. ;future – an economy heavily focused on clean energy, electric vehicles, battery manufacturing and critical minerals.

Minister Freeland has previously indicated that; it would also emphasize fiscal discipline as the Bank of Canada raises interest rates to bring inflation down. She warned, however, that the government would not be able to compensate all Canadians for the rising cost of living.

On the eve of the unveiling of the portrait of federal public finances and the Canadian economy, the opposition parties in the Commons have expressed their expectations.

In a letter to Minister Freeland on Sunday, Conservative Leader Pierre Poilievre urged the government not to impose new taxes and to refrain from ;generate new expenditure, unless it makes other budget cuts.

New Democratic Party (NDP) Leader Jagmeet Singh has meanwhile written to Prime Minister Justin Trudeau, urging him to tackle corporate greed and immediately reform the employment insurance program.

The Bloc Québécois is also calling for a reform of employment insurance, to make the system more accessible. In addition, the Bloc is calling on the Liberal government for increased, predictable and unconditional funding for the health care system and a 10% increase in the Old Age Security pension starting at age 65 – and no longer at age 75, as Ottawa said. ; decreed in July.

The Bloc is also asking the government to make more rational use of federal resources, by renouncing expenditures such as interference in areas of provincial jurisdiction or even subsidies to oil companies, said finance critic Gabriel Ste-Marie in a press release.

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