OTTAWA, ON– Federal Finance Minister Joe Oliver delivered his long-awaited federal budget on Tuesday, which restored fiscal balance to the books and even generated a surplus, allowing the government to cut taxes for small businesses by two percent by 2019.
The small business tax reduction will be phased in through 0.5 percent increments each year over the next four years to bring the rate from the current 11 percent to nine percent.
And while that is good news for owners of small trucking businesses, the Canadian Trucking Alliance (CTA) criticized the budget’s infrastructure spending in a press release, stating that transit will receive too large a portion.
Minister Oliver announced the creation of a new Public Transit Fund, to be introduced in 2017-2019, with an allocation of $250-million, which will be upped to $500-million in 2018-2019 and then to $1-billion a year after. Canada’s largest cities will benefit most from the Public Transit Fund.
“According to the budget documents, the criteria for the transit funding will include improvements to the mobility of both goods and people. No doubt this relies on the assumption that enough people will actually get out of their cars and take transit for congestion to be alleviated – reasonable in theory but it remains to be seen whether it will actually have the desired impact,” the CTA stated.
But there was no commitment to dedicating revenues generated from the diesel fuel tax to a national highway trust fund, the CTA criticized.
“It is CTA’s long-standing position that excise taxes are an archaic and regressive form of taxing business inputs and should be rolled into the GST/HST. But so long as the excise tax remains, CTA believes it should be used for highway infrastructure investment and to accelerate investment technologies required to meet federal fuel consumption/GHG reduction standards for heavy trucks,” the Alliance stated.
Another initiative outlined the budget, the Canada 150 Community Infrastructure Program, which will begin in 2017, may provide some support for roads, but details remain sparse at this time.
There were no other trucking-related budget measures announced, but the industry could potentially benefit from the extent tax breaks for manufacturers, which might generate growth in that sector, resulting in higher freight volumes, the CTA stated.
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