Although certain sector-specific measures in the latest federal budget are receiving some plaudits from investment industry, the overall reaction from industry trade groups remains far from enthusiastic.
The Investment Industry Association of Canada (IIAC), for its part, suggests that the federal government should be doing more to stimulate economic growth and bolster productivity.
"The government should be introducing bold measures to address continued weak economic conditions and the ongoing high levels of unemployment," says Ian Russell, president and CEO of the IIAC.
In particular, the IIAC is reiterating its call for an investor tax credit to promote investment in small business, modelled on the U.K.'s Enterprise Investment Scheme (EIS) program.
"We are disappointed that the government did not introduce a Canadian version of the EIS," Russell says.
At the same time, the Chartered Professional Accountants of Canada (CPA Canada) is criticizing the government's willingness to run budgetary deficits.
"This latest budget raises concerns because there is no timeline to address these persistent deficits," says Joy Thomas, president and CEO of CPA Canada. "Establishing a target date to bring the budget back into balance would create a goalpost to guide the government in its financial planning. This would greatly assist in fostering business confidence, supporting essential programs and minimizing the burden on future generations."
Read: Budget 2017
Outside of these overall criticisms, the industry is happier with certain specific budget measures that address their individual concerns. For example, the Investment Funds Institute of Canada (IFIC) is pleased with budget proposals that would allow mutual funds that are currently organized as corporations to convert to trusts without negative tax implications for investors.
IFIC says it has been working with the Department of Finance Canada on this issue over the past year.
"We commend the minister and his officials for working with the industry to provide the hundreds of thousands of investors in these funds, including people of modest means, with a smooth and equitable transition to the trust in a manner that is tax neutral," says Paul Bourque, president and CEO of IFIC, in a statement. "This provision enables mutual fund corporations to meet their fiduciary obligations to investors and permits funds to be reorganized in a tax-efficient manner."
The Canadian Venture Capital and Private Equity Association (CVCA) is another industry group with some praise for the budget. Specifically, the CVCA lauds the government's new $400-million Venture Capital Catalyst Initiative (VCCI), which aims to drive investment in growth companies.
"[The federal budget] demonstrates the government's assurance in strengthening the private capital sector to support innovative and high-growth Canadian businesses," the CVCA says in a statement.
"We are very pleased with an initiative like this specifically designed to catalyze Canadian venture capital," says Mike Woollatt, CEO of the CVCA, which advocated for the government to include a sequel to the expiring Venture Capital Action Plan (VCAP) in this year's budget.
In addition, the Canadian Life and Health Insurance Association Inc. (CLHIA) is pleased with the government's pledge to lower drug costs and its plans for the Canada Infrastructure Bank.
"We look forward to working closely with the new infrastructure bank and helping to fund the needed investment in Canada's infrastructure," says Frank Swedlove, president and CEO of the CLHIA, in a statement.
Furthermore, CPA Canada is supportive of the budget measures to combat tax evasion and to support skills training, innovation and infrastructure construction. However, the group calls for a more comprehensive review of the tax system given the various tweaks announced in the budget and the government's pledge to do more to enhance the fairness of the tax rules.
"We have consistently called for a broad-based approach to be applied when looking at making changes to the tax system," says Thomas. "An extensive review can identify areas that will assist in recalibrating the tax system so that it not only enhances efficiencies and fairness for Canadians and the business community but also plays a role in cultivating long-term, sustainable economic and social growth."
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