“They’re in a tax-cut box,” Trudeau said yesterday in an interview in his office in the nation’s main parliament building, referring to the ruling Conservative Party. “There’s nothing wrong with tax cuts, as long as they’re targeted toward helping the economy grow, helping people get jobs.”
Trudeau said he supports a plan brought forward by members of his party to increase spending on infrastructure projects such as public transit and bridges to as much as one percent of gross domestic product, or about C$17.3 billion ($15.7 billion) per year. The government said in last year’s budget it would invest C$53 billion in infrastructure over a decade.
“It’s a goal to reach toward,” said Trudeau, 42. “It’s not going to be a sudden turnaround as soon as we get elected, but we need to invest in serious long-term infrastructure that’s going to grow our economy.”
Trudeau, the son of former Prime Minister Pierre Trudeau, has emerged as the most serious challenger to the nine-year reign of Conservative Prime Minister Stephen Harper. Public opinion polls show the Liberals have pulled ahead of the Conservatives in support, with an election scheduled for no later than October next year.
Worst Results
Trudeau took over as party leader in 2013 after the Liberals suffered the worst results in their history in the 2011 election. The party dropped to third place in the House of Commons behind the Conservatives and the New Democratic Party.
Harper has pledged to cut personal taxes once the government eliminates its deficit. The February budget forecast a surplus of C$6.4 billion in the fiscal year starting April 2015.
Canada’s labor market has weakened over the past year, with a tendency toward part-time job creation restraining income growth in the world’s 11th largest economy. Employment grew by an average of 10,440 per month through August, the slowest pace since 2009, Statistics Canada data show, and there are 13,600 fewer full-time jobs in Canada today than there were in May 2013.
Finance Minister Joe Oliver said Sept. 11 the government would cut payroll taxes for small businesses in a bid to boost hiring. The government plans to reduce employment-insurance premiums by 15 percent in 2015 and 2016 for companies with less than C$15,000 in employer payroll expenses. The measures will save businesses about C$550 million over two years, Oliver said.
‘Stay Small’
The Liberals say the measure may backfire, because it discourages companies from expanding. “It’s an incentive for businesses to stay small or even get smaller,” said Trudeau. “It’s an ideological approach that doesn’t do anything to create jobs or stimulate growth.”
Instead, the government should spend C$550 million on payroll tax exemptions for businesses that create jobs, he said. Such a measure would help create more than 176,000 new jobs, the Liberal Party said in a statement.
“I don’t think government should be in the business of creating jobs,” Trudeau said. “But certainly a tax structure or incentives that reward creation of new jobs is something that government absolutely should be doing.”
Trudeau’s plan is “a massive spending program that would saddle our children and grandchildren with a huge debt burden and take money out of the pockets of hard-working Canadians trying to make ends meet,” Oliver said in an e-mail.
Oliver added that the government remains focused on “jobs, growth and long-term prosperity.”
Coffee, Doughnuts
Trudeau said he doesn’t have a problem with Burger King Worldwide Inc. (BKW)’s proposed C$12.5 billion takeover of Tim Hortons Inc. (THI), the Oakville, Ontario-based company whose coffee and doughnuts are considered Canadian symbols.
“It’s good that we’re drawing in foreign investment to Canada,” he said. “We need to respect and understand the Canadian-ness of the icon, but I don’t know that we’re taking away from it by growing the company.”
Burger King applied last week for approval of the deal under Canada’s foreign-takeover law, which requires that purchases of companies worth at least C$354 million be of “net benefit” to the country, Industry Minister James Moore said yesterday from Washington.
Original Article
Source: bloomberg.com/
Author: Andrew Mayeda
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