Department of Finance 2025 pre-budget consultation

RE: Department of Finance 2025 pre-budget consultation

Thank you for the opportunity to provide a written submission to the Department of Finance in advance of the 2025 federal budget. 

As outlined in our recently published report, Inflection Point: A plan for a competitive, productive and prosperous Canada, Canada is at an inflection point – one that demands a deliberate focus to boost economic growth and productivity. We believe that by enabling businesses of all sizes to expand and innovate, we can strengthen Canada’s economic foundation and global competitiveness – for the benefit of all Canadians.

But businesses are struggling – and uncertainty has perhaps never been higher. The economy, labour markets, affordability and regulatory uncertainty continue to concern businesses and employees alike. The rising costs of goods and services, taxes, interest rates, and now tariffs, have squeezed their bottom lines. Small businesses, in particular, have been struggling to rebound, with 57 per cent highlighting cost-related obstacles as a top issue in Q4 2024.

Canada’s innovative and entrepreneurial business community is the solution to these problems. From building homes and critical infrastructure, to exporting goods and expanding into new markets, to growing our economy and tax base, businesses will be central to solving our toughest challenges. Budget 2025 is an opportunity to support businesses in setting the building blocks to achieve the recommendations outlined in our plan, address the challenges businesses and Canadians are facing in the near term, and allow Canada to reach out full economic potential.

While the Calgary Chamber is encouraged by the government’s emphasis on investments for clean technology, housing and initiatives like the Indigenous Loan Guarantee Program, more work needs to be done. Our recommendations focus on five key priorities:

• Addressing regulatory barriers and impediments to competitiveness
• Investments in trade infrastructure and relationships
• Supporting entrepreneurs to thrive in a global market
• Promoting talent and labour
• Strengthening our communities to support well-being

Together, these recommendations will support workers and strengthen Canada’s economic position, providing relief for businesses facing rising costs, and promoting competitiveness and diversification across the country. We look forward to working with you to accelerate a sustainable and prosperous future for all Canadians.  

Sincerely, 

Deborah Yedlin 
President & CEO 
Calgary Chamber of Commerce    

Recommendations

Our pre-budget submission outlines recommendations that are informed by robust engagement with our membership, through surveys, roundtables and meetings with a diversity of businesses, across sectors and sizes, representing 400,000 workers across the country.

Addressing Regulatory Barriers & Impediments to Competitiveness

To drive economic growth, innovation, and productivity, all levels of government must remove barriers to competitiveness and provide the stability, certainty, and smart regulation businesses need to succeed. Our polling shows that nearly 70% of Canadians believe a business-friendly government is important, while 59% recognize that a strong regulatory system benefits everyone. However, the Calgary Chamber’s recent survey of members reveals that over 70% feel the government is not creating the conditions for their success. A more effective and efficient business environment will pay dividends in economic growth, innovation, and productivity.

• /Commit to fiscal prudence by balancing spending with saving for the future and reducing the federal debt and deficit. This should include focusing on key fiscal anchors over the long term, such as lowering the debt-to-GDP ratio, managing debt servicing costs, securing a AAA credit rating, and ensuring a strong balance sheets to avoid creating untenable future tax burdens.
• Expedite all regulatory approvals through fast-tracked and streamlined processes, recognizing that government needs to move at the speed of business to provide investment certainty across economic sectors. This must include amending the Impact Assessment Act to remove the existing ministerial discretion to depoliticize nation building projects.
• Undertake a review of business taxes in Canada to streamline and simplify the tax regime to facilitate business investment decisions, ensure Canada is competitive with other jurisdictions, and incentivize businesses to grow. This must include cancelling any plans to change the capital gains inclusion rate.
• Withdraw or reverse plans to implement the proposed Oil and Gas Sector Greenhouse Gas Emissions Cap RegulationsOil and Gas Sector Greenhouse Gas Emissions Cap Regulations, the Clean Electricity Regulations, and amendment 236 to the Competition Act, recognizing that these policies impose untenable financial and regulatory consequences across Canada.
• Ensure eligible businesses can receive funding from the existing clean economy investment tax credits (ITCs) and carbon contracts for difference (CCfD) in a timely and efficient manner. This should include developing incentives that advance biofuel, low carbon fuel, and sustainable aviation fuel, leveraging Canada’s agricultural expertise.

Investments in Trade Infrastructure & Relationships

Global instability, supply chain disruptions, and Canada’s heavy reliance on U.S. trade highlight the urgent need to diversify export markets, strengthen trade infrastructure, and enhance competitiveness. With over 75 per cent of Canadian exports going to the U.S., our economy remains vulnerable to external impacts. To ensure economic growth, Canada must expand trade with Europe, Asia, and South America while also addressing internal barriers, as fractured interprovincial trade costs billions in lost GDP annually. Investing in ports, pipelines, aviation, railways and roads is critical to improving market access and resilience.

• Work with provinces to reduce internal trade barriers such as regulatory differences, licensing, accreditation, transportation and labour mobility restrictions by accelerating work already underway with provincial governments, the Canadian Free Trade Agreement and the Federal Action Plan to Strengthen Internal Trade.
• Invest in supply chain infrastructure including rail, pipelines, ports, aviation and domestic manufacturing capacity to mitigate pressure points and bottlenecks, bolster the reliability of transportation infrastructure, and ensure businesses receive low-cost access to the goods and services they need to operate, grow and expand.
• Improve domestic policy by addressing regulatory burdens and restrictive tax structures impacting Canadian competitiveness. Evaluate corporate tax rates to ensure Canada is competitive with comparative jurisdictions, enables businesses to grow, and becomes a top destination for foreign businesses to scale and invest.
• Bolster Canada’s defense capacity to ensure we are a stable and secure jurisdiction for the benefit of our trade relationships, our business community and all Canadians. This includes an immediate commitment and clear plan to achieve Canada’s two per cent NATO obligation.
• Explore the creation of a National Industrial Strategy, developed in partnership with businesses across Canada, to drive a cohesive approach to growth that leverages Canada’s traditional and emerging economic strengths. This strategy will help Canadian businesses grow and scale across sectors by effectively addressing supply chain, transportation and labour concerns.
• Improve Canada’s competitiveness in attracting large-scale investments that enhance productivity and diversify the economy, such as AI data centers, manufacturing hubs, small modular reactors and critical minerals supply chain infrastructure.

Supporting Entrepreneurs to Thrive in a Global Market

Canada is facing an entrepreneurship crisis, with 100,000 fewer entrepreneurs than 20 years ago despite a growing population. Rising costs and regulatory burdens limit investment in productivity drivers like R&D, automation and digital transformation. Without action, businesses will struggle to innovate and compete, threatening long-term economic growth.

• Reduce the small business tax and increase the Small Business Tax Rate threshold currently at $500,000 to $750,000 and index the threshold to inflation moving forward. Additionally, lower Employment Insurance premium rates for small businesses to provide direct savings to businesses and employees leading to reduced expenses and increased cash flow. These changes will decrease financial burden on small businesses and increase capital availability.
• Continuing supporting the Indigenous Loan Guarantee Program, make it sector-agnostic for all industries, and ensure funding remains available for proponents in decarbonization, clean-tech as well as traditional energy spaces. An efficient and effective strategy is needed to support time-sensitive projects.
• Continue advancing Canada’s Connectivity Strategy ensuring connectivity infrastructure for all rural and Indigenous communities by 2030. The ability to access reliable internet means greater access to education, more opportunities to advance rural and remote economies, and accelerated implementation of innovation in rural areas, including agri-tech and cleantech.
• Build capacity in small and medium-sized businesses on intellectual property guidance related to their business needs. This will enhance Canada’s ability to capitalize on existing research and development opportunities helping advance their commercialization potential and growing our economy and workforce while keeping Canadian IP, jobs and investment within our borders.
• Reduce federal granting and funding barriers including arduous application processes and long approval wait times. We also recommend the introduction of a small business concierge service to support businesses as they navigate through various federal processes.
• Establish a program dedicated to supporting the adoption of technology across sizes and sectors of business in Canada. Canada’s technology aptitude is low – despite the fact we are global leaders in the development of AI – especially among small and medium-sized businesses. Programs that support digital planning, hardware and software, and attracting talent will provide sectors with increased productivity and business growth.

Promoting Talent & Labour

Ensuring everyone has the skills, tools and resources to succeed is essential and business and government must work together to understand the skills gap and ensure workers are available where they are most needed. A recent Conference Board of Canada report found that Canada’s GDP would be 1.8 per cent—or $49 billion—higher today if we had maintained an adequately skilled labour force over the past two decades. To tackle productivity constraints and ensure all Canadians can participate in the workforce, we must prioritize reskilling and upskilling while expanding the labour pool as part of a broader economic strategy.

• Enhance measures to address the labour shortage and set newcomers up for success. This includes restoring funding through the Labour Market Transfer Agreement in support of the Canada-Alberta Job Grant Program, particularly for small businesses. This will help businesses address the ongoing skills gap and allow them to develop talent without removing people from the workforce.
• Collaborate with businesses to understand their temporary foreign worker requirements, identifying program changes that will support business growth, such as increases to provincial nomination limits, extending the time workers are eligible to remain in Canada, reducing the cost and complexity of performing a Labour Market Impact Assessment, and ensuring timelines for visa approval and other bureaucratic immigration processes are not an undue barrier to entry.
• Increase support for immigrant settlement agencies across the country, many of which are facing challenges due to funding uncertainty. These agencies are critical to settle newcomers to Calgary and help them join the local labour force.
• Support dedicated newcomer entrepreneurship programs, recognizing newcomers are more likely to start a business than second- or third-generation Canadians, in part due to challenges finding meaningful work upon arrival.
• Continue to fund early learning and childcare agreementsearly learning and childcare agreements, recognizing accessible childcare is critical to reducing the labour shortage, increasing our labour force participation, boosting our GDP, and ultimately increasing the size of our economy. All levels of government must collaborate and prioritize the creation of additional private and not-for-profit childcare, while ensuring new and existing spaces remain affordable.
• Increase funding to post-secondary institutions through research grants and other measures that enable the attraction of world-class talent to accelerate the research advantage of Canadian institutions in medicine, quantum computing and clean tech. Advance and accelerate research investments which have been previously announced, such as those in Budget 2024.
• Expand funding to local businesses to help employers create work-integrated learning opportunities and access emerging local talent, ensuring youth have opportunities to develop skills and gain valuable work experience.
• Support interprovincial and international credentialing to increase the available talent and skilled labour pool. By increasing the number of credentialed workers, input costs will decrease in sectors such as home construction, and businesses will face less growth constraint due to a lack of skilled labour.

Strengthening Our Communities to Support Well-Being

Strong communities and a strong economy go hand in hand. Our polling indicates 50 per cent of Canadians believe that we are on the right track as a place to live, and we must ensure our competitive quality of life is upheld. When people have access to affordable housing, reasonable cost of living and good jobs it translates to strong economic growth. Small businesses, from cafes to bookstores, create vibrant neighbourhoods, while industries like construction and telecommunications play crucial role in improving quality of life. Fostering strong communities creates a resilient workforce, top tier talent attraction and consumers who have the disposable income to support their business.

• Work with all levels of government to prioritize the expansion of housing starts across the country through strategic tax measures and direct funding programs. This should include exploring the feasibility of eliminating the general sales tax on both the construction and purchasing of specific housing types. It should also prioritize financial support for non-market housing to ensure it is available where it is most needed.
• Ensure federal policy is designed with public safety as a leading consideration. Additionally, ensuring that essential infrastructure, such as network infrastructure, ports, railways, highways and power generation facilities are protected, should be a key consideration in developing legislation. Bill C-70, An Act Countering Foreign Interference, introduced a “sabotage – essential infrastructure provision” into the Criminal Code. Measures to punish domestic mischief or tampering with essential infrastructure could be similarly introduced.
• Provide consistent and predictable funding for disaster management programing that responds to climate and weather emergencies such as wildfires, droughts, flooding, storms, extreme heat waves and cold snaps. Ensure climate impact mitigation strategies are in place for essential infrastructure such as highways, ports, railways, terminals and network infrastructure and that targeted training programs are available to businesses.
• Unlock funding that advances infrastructure essential to sport, entertainment, arts and culture, and tourism, recognizing employees seek businesses located or accessible to vibrant and welcoming communities. This includes working with other levels of government to develop public transport and community spaces.
• Develop a granting program to support small businesses in mitigating the impact of safety and crime on their business and the broader community, providing funding for basic physical safety infrastructure (i.e., CCTV cameras, lighting and wayfinding), to keep their businesses and our communities safe.

Invest in transportation infrastructure that connects Calgary’s Airport with downtown and to other jurisdictions, enhancing the city’s position as a hub for regional tourism. Continue support for the Green Line LRT project, noting the connection between productivity and accessible city-wide transit. Work with the provincial government to support their passenger rail strategy where appropriate.

ABOUT THE CALGARY CHAMBER OF COMMERCE  

The Calgary Chamber of Commerce exists to help businesses reach their potential. As the convenor and catalyst for a vibrant, inclusive and prosperous business community, the Chamber works to build strength and resilience among its members and position Calgary as a magnet for talent, diversification and opportunity. As an independent, non-profit, non-partisan organization founded in 1891, we build on our history to serve and advocate for businesses of all sizes, in all sectors across the city.