Doubling Down on Progress for the Middle Class
October 24, 2017 – Ottawa, Ontario – Department of Finance Canada
When you have an economy that works for the middle class, you have a country that works for everyone. The investments the Government of Canada has made in people, in our communities and in our economy are working. Canada now has the fastest-growing economy in the G7 and among the strongest job growth in a decade, giving our Government the ability to reinvest the benefits of that growth back into the people who contributed most to that success.
With the Fall Economic Statement, the Government will:
- Strengthen the Canada Child Benefit (CCB) by making annual cost of living increases starting in July 2018—two years ahead of schedule. For a single parent of two children making $35,000, a strengthened CCB will contribute $560 in the 2019–20 benefit year towards the cost of raising his or her children. That means more money, tax-free, for books, skating lessons or warm clothes for winter. The added confidence the CCB brings to families has been shown to have an immediate impact on economic growth.
- Put more money in the pockets of low-income workers—including families without children and the growing number of single Canadians—by further enhancing the Working Income Tax Benefit (WITB) by an additional $500 million per year, starting in 2019. This enhancement will be in addition to the increase of about $250 million annually that will come into effect in that year as part of the enhancement of the Canada Pension Plan. These two actions will boost the total amount the Government spends on the WITB by about 65 per cent in 2019, increasing benefits to current recipients and expanding the number of Canadians receiving support.
- Help small businesses invest, grow and create jobs by lowering the small business tax rate to 10 per cent, effective January 1, 2018, and to 9 per cent, effective January 1, 2019. This will provide a small business with up to $7,500 in federal corporate tax savings per year to reinvest in and grow their business.
- Make important changes to the tax system that will ensure Canada's low corporate tax rates go towards supporting businesses, not to providing unfair tax advantages to the top 1 per cent wealthiest Canadians.
Finance Minister Bill Morneau today tabled a Notice of Ways and Means Motion in the House of Commons that proposes legislative changes to strengthen the CCB and lower the small business tax rate.
Today's Fall Economic Statement also provides an update on how investing in the economy and the middle class is delivering real results for Canadians:
- Canada is the fastest-growing economy in the G7—by a wide margin—growing at an average rate of 3.7 per cent over the last year, which is the fastest pace of growth since early 2006.
- Job creation is strong, with over 450,000 new jobs created in the last two years, and the unemployment rate at its lowest level since 2008. Youth unemployment is at an historic low.
- Growth is forecast to be 3.1 per cent in 2017—significantly above expectations at the beginning of the year. The fiscal outlook has improved by more than $6.5 billion annually on average from what was projected in Budget 2017 last March.
The Government's plan works to strengthen the middle class and to ensure Canadians have the support, resources and confidence they need to succeed, create jobs and grow our economy. Canada's growing economy means a better bottom line for the Government. Canada's fiscal position remains strong, and the Government will keep Canada's debt-to-GDP (gross domestic product) ratio on a downward track—preserving Canada's sound fiscal position so that we can continue to invest in the people who contribute to our success.
"Our plan to invest in our people and in our communities is working. Canada's economy is growing faster than it has in a decade, allowing us to do even more to help the middle class and those working hard to join it. With lower taxes on small business, more support for parents, and more money in the pockets of low-income workers, we are working to grow the economy in a way that benefits all Canadians. And that is exactly what Canadians sent us here to do."
- Bill Morneau, Minister of Finance
- Fall Economic Statement
- Fall Economic Statement Speech
- Backgrounder: Strengthening the Canada Child Benefit
- Backgrounder: Enhancing the Working Income Tax Benefit
- Backgrounder: Progress for the Middle Class
- Backgrounder: A Strong Economy That Is Working for the Middle Class
- Notice of Ways and Means Motion to Amend the Income Tax Act and Explanatory Notes
- Government Moves to Reduce Small Business Tax Rate and Support Fairness for the Middle Class
- Targeted Tax Fairness Measures Will Protect Middle Class Small Business Owners
Media may contact:
Office of the Minister of Finance
Department of Finance Canada