Joe Biden wants to raise corporate taxes and Justin Trudeau should do the same, NDP urges

“We are pointing to what (U.S. President Joe) Biden is doing,” Blaikie told the Star on Thursday, when describing what he characterized as ongoing discussions about the April 16 federal budget with the Liberal minority government, which the NDP is helping stay in power through a two-year-old parliamentary deal. 

“That conversation is still very much an open one, but I don’t know that we’re at a point yet where it’s obvious that the Liberals have settled on doing something,” Blaikie said. “We will continue to push.”

A spokesperson for Finance Minister and Deputy Prime Minister Chrystia Freeland declined to comment when asked Thursday about whether the government is considering tax increases in the upcoming budget.

“Our economic plan is about building more homes, faster, making life more affordable, and creating more good jobs — and we look forward to presenting next steps in the budget,” wrote Freeland’s communications adviser, Navpreet Chhatwal, in an email to the Star. 

Under fire from opposition parties about rising costs of living, the government is under pressure to increase funding for a range of priorities, from defence to housing and financing a new pharmacare program. At the same time, Freeland has insisted her budget will stick with new fiscal commitments she made last fall. Those include a pledge to keep the deficit for the 2023-24 fiscal year to no more than $40.1 billion — a target the Parliamentary Budget Officer estimates the government is on track to miss, by posting a projected deficit of $46.8 billion. 

The government also pledged to cap annual deficits at one per cent of gross domestic product (GDP) by 2026-27, which the Business Council of Canada — a corporate lobby group — calculates would require spending cuts or tax increases of about $12 billion per year to attain.

Two senior Liberal officials, speaking on a background-only basis, told the Star that the government has no intention of holding back in this federal budget only to roll out a pre-election “goody” budget next year. Separately, both said that Freeland’s next budget will roll out significant measures to help Canadians. 

When asked about a lack of fiscal room for new spending, one said there are ways to create fiscal room. Usually that entails either spending cuts or reallocations, or tax increases to bolster government coffers. 

While neither source would confirm tax increases are on the agenda, both noted Biden’s State of the Union address, in which the U.S. president said he intends to raise the federal corporate tax from 21 per cent to 28 per cent “so every big corporation finally begins to pay their fair share.”

Biden also proposed a new minimum 25 per cent tax for billionaires — an increase from what Biden said was an average of 8.2 per cent paid by America’s 1,000 billionaires.

“That would raise $500 billion over the next 10 years,” Biden said, “and imagine what that could do for America.”

These are exactly the type of measures the NDP wants to see from the Liberal regime it is propping up in a two-year-old parliamentary alliance. 

Under Jagmeet Singh’s leadership, the New Democrats have long pushed for higher taxes on the rich and big corporations. The party campaigned on creating a special wealth tax for multimillionaires in the last two federal elections, in 2019 and 2021. It also has called for a “windfall tax” on the profits of major oil and gas companies and grocery chains. 

Yet, despite declaring increased taxes on the rich was a surefire way to win NDP support in the Parliament Canadians elected in 2021, the NDP did not secure a wealth tax in the deal it signed with Prime Minister Justin Trudeau to prop up his government until June 2025. Instead, the Liberals agreed to implement new programs like dental care and pharmacare, among other shared priorities.