2024 Federal Budget Highlights 

Overview

Today, federal finance minister Chrystia Freeland unveiled her fourth budget: Fairness for Every Generation. The Budget’s release and rollout represents a significant shift from the traditional secrecy of past budgets, employing a strategy to shape the public narrative ahead of a scheduled election in 2025, which may still come in this calendar year.  

The Liberals hoped to draw attention to the country’s economic strengths, including a decline in inflation, rapid job recovery post-pandemic, and increased real wages. Despite these positive indicators, issues such as rising living costs, particularly for groceries and housing, persist. 

Substantial investments in housing are a centerpiece of the budget, addressing one of the most significant expenses for most Canadians. By introducing a $6 billion infrastructure program and expanding the apartment construction loan program by $15 billion, the government aims to tackle the housing shortage and, ultimately, reduce housing costs. The enhancements to the housing accelerator fund, coupled with incentives for local governments to cut red tape, are designed to increase the supply of affordable homes.  

The introduction of a $500 million initiative for mental health services particularly benefits young Canadians, potentially reducing the long-term costs and financial strain associated with mental health challenges.

Moreover, the creation of a new national food program for schools with a $1 billion commitment over five years is intended to ease the financial burden on families by ensuring that children receive nutritious meals, which can alleviate some of the family expenses on food. 
In essence, this budget aims to make life more affordable by directly lowering the costs of essential services and living expenses for Canadians, while laying the groundwork for sustained economic resilience.  

Some of the planned new spending is earmarked for future fiscal years — a manoeuvre that will give Ottawa fiscal breathing room. Minister Freeland has pointed to the economy as marginally stronger than previously expected. This should be tempered with growth that, in fourth-quarter 2023 reached 1 per cent on an annualized basis. This marginal uptick is positioned to offset some of the planned new spending. 

The government has leaned into its two fiscal anchors in this budget – a declining debt-to-GDP ratio and deficit-to-GDP ratio that eventually comes under 1 per cent. It has largely hit these targets through better-than-expected GDP growth expectations coupled with increased taxes on capital gains.  

Major CPA Advocacy Wins

The CPA has advocated extensively over 2023 and 2024 for the inclusion of physiotherapists in the Canada Student Financial Assistance program in order to provide targeted student loan relief for physiotherapists that choose to practice in rural and remote areas after graduating. The support is currently provided to doctors and nurses, and in the 2021 Liberal platform, it was promised to be extended to other professions, but not physiotherapists.

Over the last several months, CPA has met with Finance Canada, Health Canada, Employment and Social Development Canada and the Prime Minister’s Office to make the case that physios deserve inclusion in the program. Yesterday, the program was extended to the list in the 2021 Liberal platform along with two other health professions. Physiotherapy was one of them.

It is a major advocacy win for physiotherapists across Canada, and for Canadians who deserve access to quality care no matter where they live. The CPA relied on data, evidence and the testimonials of our healthcare partners at the Canadian Nurses Association and the Canadian Orthopaedic Association to secure this victory for our members.

Other Important Budget 2024 Announcements

Capital Gains Tax Increase

• An increase to the inclusion rate on capital gains realized annually above $250,000 by individuals and on all capital gains realized by corporations and trusts from one-half to two-thirds, by amending the Income Tax Act, effective June 25, 2024
  • ­ The lifetime capital gains exemption currently allows Canadians to exempt up to $1,016,836 in capital gains tax-free on the sale of small business shares and farming and fishing property. This tax-free limit will be increased to $1.25 million, effective June 25, 2024, and will continue to be indexed to inflation thereafter.
  • The government will maintain the exemption for capital gains from the sale of a principal residence to ensure Canadians do not pay capital gains taxes when selling their home.
  • To ensure homes are for Canadians to live in, not a speculative asset class for investors, since January 1, 2023, capital gains from property flipping—properties bought and sold within 1 year—have been treated as business income. Exemptions exist for many common life situations; these exemptions will remain.
  • To encourage entrepreneurship, the government is proposing the Canadian Entrepreneurs’ Incentive which will reduce the inclusion rate to 33.3 per cent on a lifetime maximum of $2 million in eligible capital gains. Combined with the enhanced lifetime capital gains exemption, when this incentive is fully rolled out, entrepreneurs will have a combined exemption of at least $3.25 million when selling all or part of a business.

Canada Carbon Rebate for Small Businesses

• to return fuel charge proceeds from 2019- 20 through 2023-24 to an estimated 600,000 businesses, with 499 or fewer employees through a new refundable tax credit. This would deliver over $2.5 billion directly to Canada’s small- and medium-sized businesses.  

Launching a National Pharmacare Plan 

• $1.5 billion over five years to Health Canada to support the launch of the National Pharmacare Plan. 

Foreign Health Care Credential Recognition 

• $77.1 million over four years, starting in 2025-26, to more effectively integrate internationally educated health care professionals into Canada’s health workforce by creating 120 specific training positions, increasing assessment capacity and providing support to navigate credential recognition systems. 

Helping People Return to School 

• To reduce barriers for adults returning to school, the government will permanently eliminate the credit screening requirement for mature students applying for Canada Student Grants and Loans for the first time.  
• This measure is estimated to cost $18.9 million over five years with $4 million per year ongoing. 

Supporting Canada’s National Athletes

• $35 million over five years and $7 million ongoing to the Department of Canadian Heritage, for the Athlete Assistance Program. This would increase the funding allowance for supported athletes and support additional athletes in new Olympic Paralympic sport disciplines.  

Canada Disability Benefit & Disability Support

• Launching the Canada Disability Benefit
  • $6.1 billion over six years, beginning in 2024-25, and $1.4 billion per year ongoing, for a new Canada Disability Benefit. This includes costs to deliver the benefit. Payments to eligible Canadians will be starting in July 2025, following successful completion of the regulatory process and consultations with persons with disabilities. The government intends for the Canada Disability Benefit Act to come into force in June 2024 in order for payments to begin in July 2025. 
  • $243 million over six years, beginning in 2024-25, and $41 million per year ongoing, to cover the cost of the medical forms required to apply for the Disability Tax Credit.  
  • Notably, the Budget specifically states:
    • To avoid persons with disabilities facing claw backs, on their provincial and territorial supports, the federal government is calling on provinces and territories to exempt Canada Disability Benefit payments from counting as income in relation to provincial or territorial supports. The federal government is making this investment due to the inadequacy of disability assistance provided by many provinces, which currently leaves far too many persons with disabilities in poverty.

• Expanding the Disability Supports Deduction
  • The government’s intention to amend the Income Tax Act to make additional expenses eligible for the Disability Supports Deduction, subject to certain conditions, such as: 
    • Service animals trained to perform specific tasks for people with certain severe impairments. 
    • Alternative computer input devices, such as assistive keyboards, braille display, digital pens, and speech recognition devices.  
    • Ergonomic work chairs and bed positioning devices, including related assessments. 
  • It is estimated that this proposal would cost $5 million over five years and $1 million per year, ongoing 

First Nations and Inuit Health

• $562.5 million to support medically necessary services through the Non-Insured Health Benefits Program, offering a range of benefits to First Nations and Inuit people (including, mental health services, medical travel, medications); $390.4 million over four years to build or renovate health facilities, including to support the Virtual Health Hub led by the Saskatchewan Indian Institute of Technologies. This funding will improve the safety of primary care workers in remote and isolated on- reserve First Nations communities; $104.9 million over five years for health transformation initiatives to support First Nations self-determination in the design and delivery of health services in their communities; and, $57.5 million over three years building on previous federal investments to construct a mercury care home in Grassy Narrows First Nation.  

Supporting Veterans’ Well-Being  

• The government will provide $6 million over three years to Veterans Affairs for the Veteran and Family Well-Being Fund. A portion of the funding will focus on projects for Indigenous, women, and 2SLGBTQI+ veterans. 
• $9.3 million over five years to Veterans Affairs to extend and expand the Veteran Family Telemedicine Service pilot for another three years. This initiative will provide up to two years of telemedicine services to recent veterans and their families.