New Mega Deduction a Good Start, But More Tax Reforms Are Needed

The Federal government has unveiled a Productivity Mega Deduction, which will provide immediate expensing under Capital Cost Allowance (CCA) provisions for a broad range of depreciable property, importantly on a permanent basis, for acquisitions on or after September 15, 2026. Check out the noteworthy exclusions are listed below. This tax reform is a good start, but much more needs to be done, especially for small business owners and average taxpayers to make Canada truly competitive across our tax base.

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In this final month of the first quarter of 2024, significant new tax filing milestones arise, but with a twist, because both March 30 and 31 are on a weekend and April 1 is a Monday.  For these reasons it’s important for tax and financial specialists to step up the tax filing conversation on critical issues like any potential RRSP excess contributions and everything related to trusts!  Here are the significant dates to know for March and April:

It’s Provincial Budget Time! First out of the gate on February 22, the BC government introduced a substantive budget which introduces a BC Family Benefit Bonus, increases the Climate Action Tax Credit, extends training tax credits, exempts farmers from participating in provincial agricultural insurance programs and most important, changes the taxation of real estate in the province, and introduces a new Home Flipping for 2025.  This is a substantive matter to discuss with clients during tax season 2024. Details follow:

February 29 was the date that compelled three provinces to release their 2024 provincial budgets:  Nunavut, Alberta and Nova Scotia.  Here are the tax highlights:

The Parliamentary Budget Officer released its projections and summary of Canada’s fiscal outlook on March 7, noting  “while total budgetary authorities are increasing in this year's Main Estimates, the pace of growth in the 2024-25 Main Estimates has slowed compared to the pandemic years” and that  “. . .  for the first time since the pandemic, voted budgetary authorities have decreased compared to previous years’ Main Estimate.”  The fly in the ointment is that those authorities still remain “roughly 50 per cent higher than in the pre-pandemic 2019-20 Main Estimates” and do not include new spending to be announced in the April 16 budget.  The PBO fiscal outlook follows: