One Comment About Taxation – The Upcoming November 5, 2026 Federal Budget – Will We See Tax Reform Announced?

When I was a kid, my parents’ hobby farm had about five head of cattle. Feeding time taught me more about human nature than any economics course I took later. The biggest and loudest shoved to the front of the trough. The quiet ones often went without. None ever asked who paid for the feed.

 

Today my wife and I keep chickens on our hobby farm. Rattle the bucket and every hen comes running like you’re their best friend.

 

Every year, the federal government rattles the bucket and calls it “pre-budget consultations.” Cue the line: industry groups, advocates, charities, unions and lobbyists, each certain the budget should feed them first. This year, the Finance Committee’s line was the longest in years.

 

On November 5, two days after the U.S. midterm elections, Finance Minister François-Philippe Champagne will table Budget 2026. That’s when we’ll find out who gets fed, and who’s left at the back of the trough.

 

The House of Commons finance committee received 1,351 written briefs and heard from 90 witnesses. That’s on top of the Department of Finance’s own summer tour: 23 cities, 44 roundtables, 56 bilateral meetings, more than 18,000 online survey responses and nearly 2,000 written submissions.

 

Not every brief wants the same thing. Most want a bigger share of the feed: a new credit, a richer program, a carve-out for their members. A handful asked the government to fix the barn instead. Guess which kind usually wins.

 

In September, the committee boiled those briefs down to 130 recommendations. By my count, at least 15 would create, expand or extend a tax credit or similar incentive. Recommendation 102 calls for a “permanent refundable home improvement tax credit,” while Recommendation 105 wants a “resiliency tax credit” for electricity infrastructure. Oh brother.

 

Then there’s Recommendation 118. It asks the government to “undertake a comprehensive review of Canada’s tax system.” The same report that wants the whole system reviewed also wants at least 15 new or richer tax breaks bolted onto it. Every one adds complexity and compliance costs and narrows the base, which keeps rates higher for everyone else.

 

Don’t count on the review. The corporate tax review the Liberals promised in 2025 quietly died, replaced by consultations. Asking 1,351 groups what they want isn’t a review. It’s a wish list.

 

What a real rebuild looks like arrived on October 22. The C.D. Howe Institute’s 2026 Shadow Budget would cut the federal brackets from five to three, dropping the 26 per cent rate to 20.5 per cent and the 29 and 33 per cent rates to 26 per cent. If no province raises its own top rate, the combined top rate would fall below 50 per cent everywhere. A new simplified credit would lift the tax-free threshold above $26,000 for filers who give up most other deductions and credits; most, especially lower earners, would come out ahead.

 

The general corporate rate would drop to 11 per cent, paid for mainly by scrapping the small business deduction and narrow credits, while a three-point GST increase covers the income tax shortfall. A higher GST won’t be popular. Serious reform never is. The budget would balance by 2030/31, helped by about $42 billion a year in spending cuts.

 

I’m not against any of it. In fact, I’d go further: a much larger lifetime capital gains exemption to compete with the U.S. qualified small business stock rules, full elimination of the alternative minimum tax, and a broad rollover so capital gains can be reinvested before tax. But C.D. Howe gets the core right. Rates and base move together, and the whole system is on the table at once.

 

So here’s what I’ll be watching on November 5. Comprehensive reform means an independent review with a mandate and a deadline, personal and corporate systems tackled together, and rate cuts paired with a broader base and fewer credits, not more. What I fear we’ll get instead is a handful of sexy new tax measures stitched onto the patchwork quilt that is our tax system and branded as reform. That isn’t reform. It’s more complexity.

 

I’m not a fan of budget leaks, but they’ve become routine, and they’ve already started. Apparently the government is considering cutting the small business tax rate, now 9 per cent, and EI premiums for smaller firms. That’s no needle mover. It would widen the gap with the 15 per cent general rate, a gap the C.D. Howe plan closes by scrapping the small business deduction. The playbook rhymes with the late 1970s: spend, borrow and hand out targeted tax breaks.

 

I’ll also be watching the whole deficit, not the slice the government wants watched. Its split between an “operating” and a “capital” budget lets it call the books balanced while borrowing continues. The test is simple: how much of any improvement comes from real spending restraint, and how much from relabelling?

 

Strip away the branding and a budget is a simple thing: a plan for spending other people’s money. Being responsible with it is the whole job. As the C.D. Howe authors put it, “responsible fiscal policy means paying the bills for spending as they come due.”

 

This government isn’t paying them. On C.D. Howe’s status quo projections, which adjust the spring update for weaker growth, deficits run between $76 billion and $81 billion a year from 2026/27 through 2030/31. Net debt climbs to $1.73 trillion, or 45 per cent of GDP, up from 31 per cent before COVID-19. Debt charges reach $83 billion that year. Interest buys nothing. Every borrowed dollar is a bill handed to our children and grandchildren, who never got a vote.

 

Real reform takes courage. Patches take a press release.

 

My parents paid for every bag of feed our cattle ever ate, and my wife and I pay for every scoop our chickens get. This government puts the feed on our kids’ credit card.

 

On November 5, watch who eats.

 

One Comment About Leadership – The Hardest Word in Leadership Is “No”

 

Steve Jobs once said, “I’m actually as proud of the things we haven’t done as the things I have done. Innovation is saying no to 1,000 things.”

 

That’s a remarkable thing for one of history’s great product builders to be proudest of. But it gets at something most leaders miss: they don’t fail by saying no to the wrong thing. They fail by saying yes to everything.

 

Saying yes feels like leadership. It makes people happy, it avoids conflict and it keeps your approval rating high. But every yes spends something: money, time, attention, credibility, or focus on your strategy and vision. And the people asking loudest aren’t always the ones who deserve it most.

 

Think about who shows up in your office. The team member who pushes hardest for a raise. The department that lobbies for a bigger budget every quarter. The client who calls three times a day. They’re not wrong to ask. Asking is their job. Deciding is yours.

 

Here’s the trap: every yes to the loud is a quiet no to someone else. The diligent employee who never complains. The maintenance project nobody champions. The cash reserve for next year’s downturn. Your future self. None of them are standing at your door, so they lose by default.

 

And the more popular you are, the bigger the trap. Popularity is a powerful sedative. When people like you, they stop pushing back, and you stop noticing what you’re trading away. A well-liked leader can run a business into the ground with a smile on everyone’s face, right up until the bills come due.

 

Jobs understood that focus is allocation, not distribution. Distribution is handing out resources to whoever asks. Allocation is deciding where limited resources do the most good, then explaining why to the people who didn’t get what they wanted.

 

That explanation is where the courage lies. A no without a reason feels arbitrary. A no with a clear reason, tied to priorities everyone understands, builds trust, even among the people you disappointed. Over time, it teaches your team that requests are weighed on merit, not volume.

 

A few practical habits help:

 

• Ask who isn’t in the room. Before approving a request, ask who bears the cost if you say yes.

 

• Make the trade-off visible. “If we fund this, we don’t fund that.” Saying it out loud forces an honest conversation.

 

• Distrust unanimous applause. If every decision you make is popular, you probably aren’t making many real decisions.

 

Leaders – your job isn’t to keep everyone happy or to be likable. It’s to keep the organization healthy. Sometimes those are the same thing. Often, they aren’t.

 

Be as proud of your no’s as your yeses.

 

One Comment About Economics / Politics  – The PBO Is Worried About Canada’s Debt. Canadians Aren’t. They Should Be.

 

On October 20, 2026 the Parliamentary Budget Officer (PBO) released its latest economic and fiscal outlook. The headline: federal borrowing will rise by $732.9 billion over the next five years, and federal debt will rise as a share of the economy every single year.

 

That same week, Abacus Data found approval of the Carney government at 59 per cent, with the Liberals at 48 per cent, their highest level since 2016.

 

Canada’s independent fiscal watchdog is raising the alarm. Canadians are giving the government a pass. That boggles my mind.

 

Start with the numbers. The PBO projects cumulative deficits of $333.3 billion over five years, but borrowing of more than double that. The gap is loans to Crown corporations, defence equipment and other spending that accrual accounting books as “assets” rather than deficit spending. Every dollar is still borrowed. Debt is debt is debt.

 

And debt carries interest. Public debt charges are the fastest-growing federal expense: $24.5 billion in 2021-22, $59.3 billion this year and a projected $83.0 billion by 2030-31. By then, that’s $1,952 per Canadian, more than $7,800 for a family of four, every year, before a single nurse, soldier or road is funded. Federal debt per Canadian is projected to reach $39,191. And those are the PBO’s numbers. The C.D. Howe Institute’s status quo projections are worse.

 

The government will point to a different number. The PBO now projects it will meet its fiscal anchor of balancing the “operating budget” by 2028-29. Don’t be fooled. As I’ve written many times, splitting the budget into “operating” and “capital” is a deceptive accounting trick. The government defines what counts as capital, and its definition is breathtakingly broad. Of the $52.6 billion in new measures announced since June, more than 80 per cent is classified as capital and sits outside the anchor. The PBO’s verdict: the government’s anchors have imposed “limited fiscal discipline” on spending and borrowing.

 

Even the improvement isn’t earned. It comes from higher oil and commodity prices, which the PBO expects to fade, not from spending restraint. Without the new measures since June, the operating budget would have balanced a year early. The government spent the windfall instead.

 

So why aren’t Canadians angrier? Part of the answer is in the same Abacus poll: 40 per cent still name Donald Trump and his administration as a top-three issue facing the country. Trump is loud, the tariffs are real, and standing up to him feels like leadership. A prime minister seen as tough on Trump gets a pass on everything else.

 

But feelings about Washington don’t pay Ottawa’s interest bill.

 

Here’s the irony. The same poll finds cost of living is, by a wide margin, Canadians’ top concern. Nearly $2,000 per person a year in federal interest by 2030-31 is a cost of living. It gets paid through higher taxes, fewer services or more borrowing pushed onto future generations. Usually all three.

 

The PBO is doing its job. Bondholders and credit rating agencies are paying attention. Canadians should too, before the interest bill forces them to.

 

When the budget lands, ignore the operating balance. Look at total borrowing and debt charges. That’s where the truth is.

 

Bonus Comment – From Tony Blair – Former U.K. Prime Minister – About The Art of Leadership

 

“The art of leadership is saying no, not yes. It is very easy to say yes.”

 

Agree. Yes is a gift to the person asking. No is often a gift to everyone else.

 

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 Two 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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