Tariff support, focus on investment on business leaders' federal budget wish lists

“We want to see initiatives that bring the private sector back into the economy and investing in the economy. We live in a world where capital is becoming increasingly sparse; there’s a lot of competition for capital out there,” said Theo Argitis, senior vice-president of policy at the Business Council of Canada.

He wants to see measures that lower uncertainty for businesses and make the investment environment more favourable.

The federal Liberals are scheduled to table the budget on Nov. 4. Carney has billed it as one of both cost-cutting and investment as his government attempts to balance fiscal restraint with supports needed to protect and grow an economy hit by U.S. tariffs. 

The parliamentary budget officer said Thursday he expects the document will reveal a sharp increase in Ottawa’s annual deficit to $68.5 billion this year, up from $51.7 billion last year.

Dan Kelly, president of the Canadian Federation of Independent Business, said he will be paying attention to what tariff relief measures will be included in the budget. The government has announced some targeted measures, but he said small businesses are looking for broad-based supports.

“Canada has a million different business subsidy programs, most of which don’t deliver and have huge staff head counts behind them,” he said.

“We’ve always felt that broad-based tax relief and regulatory relief would have much greater economic impact than a host of government programs that nobody knows about (or) applies for, and end up just creating jobs for bureaucrats as opposed to jobs in the private sector.”

Kelly added that recent changes in U.S. policy are another reason to provide tax relief for businesses here. Small businesses were particularly hurt by the elimination of the de minimis exemption, which had allowed packages worth $800 or less to ship south of the border without duties.

However, Kelly noted that senior government officials have reminded the CFIB that the size and scope of the deficit will place limitations on what relief it can provide.

For the tech industry, Benjamin Bergen, president of the Council of Canadian Innovators, said access to capital is a priority, for which there are a number of reforms the government could make.

Specifically, he said the federal government’s Scientific Research and Experimental Development tax incentive program has been cumbersome.

The program is meant to encourage research and development in Canada by providing funding for specific projects that improve a company’s competitiveness and tax incentives for R&D activities.

“We’re hoping to see some major overhauls in reform there on that access to capital side, and what we’re looking to see is the program a lot more streamlined and easier to use and more of those dollars going to domestic Canadian headquartered firms rather than to foreign multinational companies,” Bergen said.

He added the Council of Canadian Innovators will also be looking for any measures related to defence spending in the budget.

In June, Carney said Canada and its NATO allies agreed at their annual summit to substantially hike their defence spending target to five per cent of annual gross domestic product by 2035.

“The question here really is, how is that money going to be spent? Is it going to be used to buy planes and tanks from the U.S., or is it going to be used to actually catalyze and create a domestic defence tech industry?” Bergen said.

In July, CCI said planned increases in defence spending present an opportunity to propel the domestic technology sector through defence procurement. The council said it was asked by the federal government to provide a list of Canadian companies to help serve defence needs.

The defence and technology industries can intersect in areas such as cybersecurity and AI systems.

The government has named the first batch of major projects it aims to fast-track through the review process, and critical minerals were broadly identified as a key priority.

Amid the focus on minerals, the Mining Association of Canada sent a letter to the Department of Finance, detailing a series of recommendations for the budget.

The list included strengthening Canada’s mining sector to grow domestic supply chains and advanced manufacturing.

“Capital funding for mining projects should be increased, streamlined and made more accessible, with a focus on maximizing mineral output,” the letter reads.

Other recommendations included regulatory reforms to improve timelines for future mines and strengthening Indigenous participation in the mining industry.

However, this renewed focus on mining and other resource-based projects have prompted some backlash.

On Sept. 20, Canadians in several major cities demonstrated against elements of the federal government’s plans, voicing concerns around climate change.

Regardless of what the budget entails, the other elephant in the room remains the renegotiation of the Canada-United States-Mexico Agreement, which is up for review next year. 

Exemptions under the agreement are shielding most Canadian goods from U.S. tariffs, though sector-specific duties on steel, aluminum, autos and softwood lumber are hurting those industries.

Argitis said the renegotiation of North America’s trade agreement is more important than any item that may be included in the budget.  

This report by The Canadian Press was first published Sept. 28, 2025.