-- Finance Minister Chrystia Freeland’s upcoming budget is likely to put significant money toward boosting Canada’s housing supply, according to people familiar with the plans, adding pressure on the government to find more revenue.
Home construction activity was soft in parts of Canada last year as higher interest rates and slow approval times discouraged many developers from starting projects. Meanwhile, surging rents have led to new debate about whether the country can continue to absorb large numbers of immigrants. “The latest rumor in Ottawa is the government will try to solve its problem by introducing a new corporate tax — one that targets Canada’s most successful companies,” Goldy Hyder, chief executive officer of the Business Council of Canada, wrote in an editorial published in The Hub on Wednesday.
“Now that rates have gone up this much, I don’t think it would be especially constructive to really slam the brakes on the fiscal side,” said Doug Porter, chief economist with Bank of Montreal, adding that he’d still “heavily caution against spending a lot more at this stage.”