2024 budget hurts inflation fight, foreign investment, young people: Dodge

Former Bank of Canada Governor David Dodge has few nice things to say about the federal government’s latest budget and instead argues it will hurt large swaths of Canadians and the country’s economy.

Dodge, an economist who led the Bank of Canada from 2001 to 2008, said the federal budget and recent provincial budgets are “not very helpful” to the central bank’s pursuit of stable inflation.

“That's unfortunate,” he told BNN Bloomberg in a television interview on Thursday. “The big problem is that most of what the minister did was to concentrate on raising current consumption rather than promoting investment in machinery, equipment and intellectual property, which is really necessary in order to provide workers with the capital that will allow them to be more productive.”

Dodge has a particular gripe with the federal government’s hike on capital gains tax, which brings the inclusion rate from one-half to two-thirds for gains realized by trusts and corporations. The two-thirds inclusion rate will only apply to individuals with capital gains realized annually over $250,000.