On April 16, 2024, the Deputy Prime Minister and Minister of Finance, Chrystia Freeland, tabled the 2024 Federal Budget.
National Payroll Institute representatives were invited to attend the reading of the embargoed budget documents during the lockup. The 2024 budget is focused on expanding the capacity of the Canadian economy to create new opportunities today and for the next generation.
The government is focused on accelerating productivity growth and the uptake of clean technologies as well as artificial intelligence (AI). The Budget contains few measures that directly impact payroll and several initiatives that may affect employers and employees.
Employer-led training
Budget 2024 proposes $50 million over four years to provide skills training for workers in sectors disrupted by AI, and $10 million over two years to train more early childhood educators, building up the talent needed for the expansion of affordable, high-quality childcare.
Job Protections for Federal Gig Workers
In Budget 2024, the government proposes to amend the Canada Labour Code to improve job protections for federally regulated gig workers by strengthening prohibitions against employee misclassification.
Further, on the topic of worker misclassification, Employment and Social Development Canada and the Canada Revenue Agency will enter into necessary data-sharing agreements to facilitate inspections and enforcement.
Establishing a Right to Disconnect
Budget 2024 proposes to provide $3.6 million over five years, starting in 2024-25, and $0.6 million ongoing to enable the Labour Program at Employment and Social Development Canada to implement legislative amendments to the Canada Labour Code that would require employers in federally regulated sectors to establish a right to disconnect policy limiting work-related communication outside of scheduled working hours.
Modernizing the Employment Equity Act
Through the Employment Equity Act, the government promotes and improves equality and diversity in federally regulated workplaces. That is why, in 2021, the government launched an arm’s length Task Force to review the Act and advise on how to modernize the federal employment equity framework.
Following the recommendations of the Task Force, Budget 2024 announces the government’s intention to propose legislative amendments to modernize the Employment Equity Act, including by expanding designated equity groups.
Extending Temporary Support for Seasonal Workers
Many seasonal workers—including in fishing and tourism sectors in Atlantic Canada and Quebec—rely on Employment Insurance for the support they need between work seasons. To address gaps in Employment Insurance support between seasons, the government introduced temporary rules in 2018 to provide up to five additional weeks—for a maximum of 45 weeks—to eligible seasonal workers in 13 economic regions. This support is set to expire in October 2024.
Budget 2024 proposes to extend this support for seasonal workers in targeted regions until October 2026. The cost of this measure is estimated at $263.5 million over four years, starting in 2024-25.
Doubling Volunteer Firefighter and Search and Rescue Tax Credits
Budget 2024 announces the government’s intention to amend the Income Tax Act to increase the tax credits, from $3,000 to $6,000, in recognition of the important role played by these volunteers in contributing to the security and safety of Canadians. Enhancing the tax credits will provide these essential volunteers with up to an additional $450 back on their taxes.
Non-Compliance with Information Requests
Budget 2024 proposes several amendments to the information gathering provisions in the Income Tax Act. These proposed amendments are intended to enhance the efficiency and effectiveness of tax audits and facilitate the collection of tax revenues on a timelier basis.
Notice of Non-Compliance
Budget 2024 proposes to amend the Income Tax Act to allow the Canada Revenue Agency (CRA) to issue a new type of notice (referred to as a “notice of non-compliance”) to a person that has not complied with a requirement or notice to provide assistance or information issued by the CRA.
Helping Students Gain Work Experience
Work-integrated learning opportunities, such as co-ops and internships, are a proven way for post-secondary students to gain valuable skills and get a foot in the door of their future career. For businesses, the government’s work-integrated learning programs help them identify and recruit skilled and trained individuals, addressing a significant challenge for employers: finding the right talent.
That’s why the government supports practical, hands-on learning and connections with employers through the Student Work Placement Program.
Budget 2024 proposes to provide $207.6 million in 2025-26, to Employment and Social Development Canada for the Student Work Placement Program.
The New Canada Carbon Rebate for Small Businesses
Budget 2024 proposes to urgently return fuel charge proceeds from 2019- 20 through 2023-24 to an estimated 600,000 businesses, with 499 or fewer employees through a new refundable tax credit. This would deliver over $2.5 billion directly to Canada’s small- and medium-sized businesses.
Employment Insurance Premium Revenues
The premium rate projection is forecast to fall to $1.62 per $100 of insurable earnings in 2025—26 cents lower than it was between 2013 and 2016 ($1.88).
A Single Sign-In Portal for Government Services
To establish a modern, single sign-in portal for federal government services, Budget 2024 proposes to provide $25.1 million over five years, starting in 2024-25 to Employment and Social Development Canada.
Automatic Tax Filing for Low-Income Canadians
In February 2024, the Canada Revenue Agency (CRA) increased the number of eligible Canadians for SimpleFile by Phone (formerly File My Return) to 1.5 million people, more than double the number of people eligible last year.
The CRA is on track to increase this number to two million by 2025.
In summer 2024, the CRA will pilot new automatic filing services, SimpleFile Digital and SimpleFile by Paper, to help more Canadians who do not currently file their taxes receive their benefits.
Please see Federal Budget 2024 for more details on these and other measures. The Institute will monitor the progress of these announcements and the resulting administrative impact and will include them in our Late Breaking Payroll News as details become available.