Canada’s Finance Minister, the Honourable Chrystia Freeland, tabled the 2021 federal budget on April 19, 2021. The COVID-19 pandemic brought about the deepest and fastest recession, worldwide, since the Great Depression, having an unprecedented impact on the Canadian labour market, with more than 3 million Canadians losing their jobs and another 2.5 million Canadians working significantly reduced hours—representing about 30 per cent of the pre-pandemic workforce. The budget was aimed at addressing COVID-19 relief and ensuring the Canadian economy was well positioned for growth after the pandemic.
After accounting for Budget 2021 measures, the budgetary balance is expected to show a deficit of $354.2 billion in 2020-21, improving to $154.7 billion in 2021-22, and gradually declining to a deficit of $30.7 billion in 2025-26, or approximately one per cent of GDP. The federal debt is expected to peak at 51.2 per cent of GDP in 2021-22 before declining to 49.2 per cent of GDP in 2025-26.
The budget announces the extension of COVID-19 relief programs along with the introduction of the new Canada Recovery Hiring program, establishes the Canada-wide Early Learning and Child Care System, introduces a luxury tax for personal use of luxury cars, boats and personal aircrafts and implements a tax of 3% on revenue from digital services.
The full summary of significant tax and program changes announced in the budget can be downloaded below. Please note that the changes are proposals until passed by the federal government.
Finance Minister Selina Robinson tabled the 2021 British Columbia provincial budget on April 20, 2021.
The deficit for the 2020-2021 fiscal year is anticipated to be $8.1 billion, which is less than the previous prediction of $13.6 billion. The budget projects a deficit of $9.7 billion for 2021-2022 and $5.5 billion in 2022-2023.
There were no increases or decreases to personal or corporate income tax rates for 2021. However, the budget did include extensions of certain tax credits, PST exemptions on electric bicycles and tricycles, and increases to tobacco tax rates.
The full summary of the changes announced in the budget can be downloaded below. Please note that these changes are proposals until passed into law by the provincial government.