One Comment About Taxation – Canada Doesn’t Need More “Tax Coupons”

 

*note – I wrote this section before the April 28, 2028 “Spring Update” – you can find my comments on the Spring Update in the Economics section below.

 

When I was a young boy, I would watch my Mom diligently read the newspapers and the flyers that came with them. She would cut out coupons and tuck them away for the next trip to the store.

 

Today, the newspaper coupons have been replaced by a flood of digital ones – app notifications, email blasts, loyalty offers. Frankly, I get exhausted by all the coupon noise and simply ignore it. Over the last decade or so – and in particular the last year, I have come to feel much the same way about Canadian tax policy.

 

For this week’s Spring Economic Update, I have one hope for it: no new coupons and significant expenditure reductions.

 

Over the past 16 months, Canada has developed a coupon-book tax policy. What started under the Trudeau government with a poorly thought-out two-month GST “holiday” in December 2024 – February 2025 has been expanded, rebranded, and extended by the Carney government into a rolling calendar of temporary measures – each one felt at a moment (the till, the pump, the direct-deposit date).

 

Consider the ledger:

 

Measure	Period	The Pitch	The Fiscal Reality
GST/HST Holiday	Dec 2024 – Feb 2025	“Tax break for all Canadians”	$1.5B federal hit; most small businesses struggled with implementation
“Canada Groceries and Essentials Benefit”	GST credit top-up June 2026; enhanced through June 2031	“Food security”	$11.7B over six years
First-Time Home Buyers’ GST Rebate	Announced March 2025 and ongoing until Dec 2030	“Housing affordability”	PBO: $1.9B; Finance: $3.9B – roughly double
1% personal tax reduction on lowest bracket	Announced during April 2025 election campaign and confirmed in May 2025	“Tax reductions for 22 million Canadians”	Despite Finance saying the maximum savings per couple is $840, the PBO estimates average savings is roughly $200 per tax filer with an estimated net cost of $28.2B over 5 years.
Fuel Excise Tax Suspension	April 20 – Sept 7, 2026	“Summer relief” amid “global oil disruptions”	$2.4B forgone over five months

 

Five measures. Most temporary or narrowly targeted.

 

This is taxation by software update.

 

On April 14 – the day after the by-elections that converted his minority into a majority (with the crucial help of the floor-crossers) – Prime Minister Carney announced the fuel excise suspension and, in the same breath, pre-announced that the Spring Update would include “some restructuring of already announced measures.” Translation: more coupons may be on the way. The question is whether they expand the book or replace it with something that resembles actual policy.

 

On April 23, 2026, The C.D. Howe Institute published a piece titled “Fiscal fantasy: Believe it or not, fiscal reality hasn’t gone away”. Its view of the upcoming Spring Economic Update was unambiguous: “Growth in the economy and government revenues is feeble – in part because high taxes and excessive borrowing are discouraging work and investment. Spending has roared ahead…The federal government’s upcoming spring economic update must prefigure a change to fiscal realism. It must not feature more boondoggles like the juiced up GST tax credit or its recent suspension of the fuel tax – another debt-financed handout that will do nothing for growth.”

 

Former Bank of Canada governor David Dodge made a similar point last week: the government needs to cut, not simply spend and borrow more. I agree – no more coupons.

 

On April 25, 2026, the Department of Finance reported a $31.2 billion budgetary deficit for the ten months ending January 31, 2026. With the November 4, 2025 budget projecting a full-year deficit of roughly $78 billion, government supporters and friendly pundits promptly suggested the year-end number might come in well below budget. What they omit is that the $31.2 billion does not include an additional $51.4 billion in “non-budgetary requirements” – predominantly loans, investments and advances that the government’s new Capital Budgeting Framework would likely classify as “capital” – bringing the actual ten-month financial requirement to $82.6 billion. This sleight of hand accounting is deceptive and misleading.

 

The longer-run warnings are serious. The C.D. Howe estimates that combining the November 2025 federal budget with the 2026 provincial budgets points to a national net debt ratio climbing from roughly 66 per cent of GDP pre-pandemic to approximately 82 per cent by 2028–29. Every province is running a deficit. Every province projects net debt rising faster than GDP. This is the trajectory Canada travelled in the 1970s and 1980s – before the mid-1990s reckoning forced spending cuts and some tax reforms that set up two decades of growth.

 

The intellectual dishonesty runs through all of it. The federal consumer carbon tax was cancelled on April 1, 2025, a political retreat disguised as policy. Exactly one year and 19 days later, the same government is subsidizing fuel consumption through forgone excise revenue while a climate agenda is still claimed. The government is essentially paying people to burn the carbon they claim to be taxing through the industrial carbon tax. One of these positions has to give.

 

What Canada needs today is not a new coupon. The prescription has been on the table for years – in C.D. Howe’s work, in Dodge’s warnings, and in the Jack Mintz “Big Bang” tax reform proposals that I fully support. A realistic fiscal baseline. A credible path back to balance. Spending restraint benchmarked to mid-to-late 2010s levels. Tax reform that encourages work and private investment. The diagnosis does not vary.

 

My Mom’s coupon clipping was at least predictable. She read the same flyers each week and knew what would be there. Canadian taxpayers and small business owners have no such luxury. Their coupons arrive by press release, start and end randomly, and come with related administrative burdens – all so the government can announce “relief” that will be felt for exactly as long as it takes the next news cycle to roll in.

 

I ignore the digital coupon noise because it exhausts me. Canadians deserve a tax system they don’t have to ignore to stay sane.

 

Unfortunately, I’m not optimistic that our current government agrees. Coupon hand-outs are too politically rewarding.

 

One Comment About Leadership – Good Leadership is Intentional

 

Good leaders are intentional. They know what they stand for, work hard to draw purpose out of their teams, and lead with authenticity. None of that happens by accident – it requires effort, humility, and a constant commitment to improve.

 

Be intentional.

 

One Comment About Economics / Politics  – The Canadian “Spring Economic Update”

 

On April 28, 2026, the federal government’s “Spring Economic Update” was released.

 

Some highlights:

 

• No personal or corporate tax rate changes;
• No promised corp “expert tax review”;
• Overall deficit reduced from its original projection of $78.3B to $66.9B due to windfall revenues from higher oil prices and higher tax revenues. Cue the crowing that this reduction is good fiscal management. It isn’t. The deficit is still a history making deficit and represents poor fiscal policy despite all the rhetoric in the budget documents about how great Canada is compared to other countries. The reality is we are in poor fiscal shape.
  • I’m purposely ignoring the constant chatter in the Update about the “capital” and “operating” amounts that are separated in the budget. As I’ve mentioned many times in my writings, this is simple deception. It might fool the financially illiterate though…
• Public debt charges are projected to increase from $54B in 2025-2026 to $80.9B in 5 years. Today, it consumes approximately 10.2% of total projected budgetary revenues ($529.5 billion for 2025-26)
• To put that in perspective, the transfers to the provinces for health transfers is projected to be $58.4B for the next year & increasing to $67.9B in five years. In other words, before any public services can be provided, we must first pay the debt servicing costs. And those costs are almost equal today to the projected health transfers. A fiscal train-wreck despite all the crowing.

 

The tax measures in the Update were light & included:

 

• Some welcome – and long overdue – amendments to the disability tax credit regime;
• A permanent extension of the $10M Employee Ownership Trust exemption.  While the government may like this program, the reality is that it is far too restrictive to be of any use for most private businesses. The projections in the budget documents for pick-up are far too optimistic, imo. I don’t know any sane business owner who would realistically want to use these provisions – $10M exemption or not.
• Tinkering with the RRSP home-buyers plan;
• A proposal to increase the limit on eligible temporary relocation expenses that can be deducted in a year from $4,000 to $10,000 with annual indexation thereafter, and to modify the distance rule such that the temporary lodging must be at least 120 kilometres closer to each temporary work location than the taxpayer’s ordinary residence.
• The usual “green” tax credit / enhancement stuff….yawn…
• A new measure where CRA will prioritize requests for Advance Tax Rulings related to “large-scale, nation-building projects….” Huh?? Come on. By doing this the government is letting “big-ticket” projects jump to the front of the CRA line for tax rulings, effectively giving wealthy investors a “fast-pass” while everyone else waits. This creates a two-tier system where political importance

 

Rather than fairness – determines how quickly you get an answer from the taxman.

 

We need adults at the wheel.

 

Bonus Comment – From Me – Kim G C Moody – About Intentionality For Leaders

 

“Intentional leaders focus less on doing things right – and more on doing the right things.”

 

Leaders, again, be intentional. And focus on the “right” things.

 

I hope today’s newsletter has been thought-provoking for you.

 

As many of you know, I’m passionate about helping people make better decisions – whether in tax, leadership, or business. If you’d like to go deeper on those topics, my recently released book, Making Life Less Taxing (Version 2), is now available and expands on many of the practical ideas I’ve written about over the years.

 

I’m also putting the finishing touches on my next book, Leadership Compounds: How Small Decisions Build Culture, Credibility, and Legacy. It explores a simple but powerful idea: leadership isn’t about grand gestures – it’s about the small, consistent decisions that compound over time.

 

For those interested in a more hands-on approach, I’ll soon be announcing a bespoke consulting initiative – The Acorn Growth Program – designed to help leaders and organizations grow intentionally, one small (but important) decision at a time. Feel free to reach out to me directly for more information.

 

And if you’re not already on my mailing list, feel free to sign up for my In the Mood Network newsletters to receive more content. No fluff – just practical insights on tax, leadership, and economic policy.

 

Thanks for reading. As always, I welcome your thoughts and feedback.

 

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