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Federal Budget

Adopting fiscal responsibility should be top priority for next budget

From making tax policy less burdensome to building a clean economy, here’s a snapshot of CPA Canada’s key recommendations for budget 2024

As we anticipate the release of this year’s federal budget, CPA Canada is highlighting some of its pre-budget recommendations. Released in August 2023, these considerations cover important areas such as responsible spending, climate action, tax policy, artificial intelligence (AI) regulation, standard setting and anti-money laundering (AML).

Here are our key recommendations:


The 2023 federal budget added $70 billion in new spending while breaking a promise to reach a budget surplus by 2027-28. John Oakey, vice-president of tax at CPA Canada, says increased governmental expenditures—partly stemming from COVID-19 measures—are to blame, which is why CPA Canada has recommended creating a fiscal framework with clear goals and deadlines to eventually balance the budget.

“As CPAs, it’s in our DNA to be fiscally prudent and manage finances in a sustainable way,” says Oakey. “Our biggest ask is for the government to commit itself to putting some fiscal restraint in place.”

Oakey also says adopting a principled approach to tax policy and administration—one that prioritizes simplicity, fairness, efficiency and competitiveness over political considerations—will be important.

The last time we had an independent tax review where a significant tax reform was initiated was in 1967—a process essential to correcting tax inefficiencies.

“Since the last independent tax review, there’s been a significant volume of legislation added to The Income Tax Act,” says Oakey. “As such, the key principles of simplicity and efficiency have become lost or distorted over the years.”

Oakey explains that such new tax legislation has inadvertently created undue hardship for businesses and individuals, especially ballooning administration costs.

“Between 2015 to 2023, the number of Canada Revenue Agency’s employees increased by approximately 50 per cent and its annual authorized budget increased by 300 per cent,” says Oakey. “That’s evidence that our tax system is becoming more complicated.”


In just the past year, Canada has experienced deadly wildfires, hurricanes, flooding and record-breaking temperatures, putting the climate crisis in the spotlight for politicians and the public alike. CPA Canada stands behind Canada’s National Adaptation Strategy, which lays out a multi-faceted plan to prioritize and coordinate climate action and build resilience, but more financial backing is needed to achieve its goals.

“We are pleased to see the government’s continued focus on adaptation and preparing for the longer-term impacts of climate change,” says Rosemary McGuire, CPA Canada’s vice-president, research, guidance and support. “Adaptation measures can also be a major source of competitive advantage leading to the development of new products and services. However, long-term funding commitments are needed to realize the ambitious objectives set out in the strategy.”

The 2023 budget prioritized improving the efficiency of impact assessment and permitting processes, as well as developing a comprehensive approach to carbon contracts. CPA Canada stressed the importance of acting fast, as policy uncertainty can slow down major long-term investments needed to transition industries to low carbon operations.

“Given the scale of investment required to transition to a low-carbon economy, businesses require a stable and competitive business environment,” says McGuire. “These promises in budget 2023 were intended to streamline the cumbersome process of assessing and approving major infrastructure projects and to provide some certainty around the future price of carbon. Together they would help to give businesses the confidence to make major investments in Canada, something that is especially important due to the incentives available in the United States.”


CPA Canada has also proposed the creation of a cabinet committee to handle the opportunities and challenges posed by emerging technologies, such as AI.

“This issue has skyrocketed to top of most public policy agendas,” says McGuire. “The most recent World Economic Forum report highlighted AI-related risks among the top risks likely to present a material crisis on a global scale.”

McGuire points out that Bill C-27—which contains new legislation to better regulate the AI industry—is currently under review after receiving feedback on it, including from CPA Canada.

“We are supportive of policies that enhance trust and accountability in AI.” says McGuire. “It’s difficult to do this in isolation without having a coordinated, consistent and holistic approach across government.”


CPA Canada backs the call for an independent standard-setting entity, as proposed by the Independent Review Committee on Standard Setting in Canada (IRCSS) and called on the federal government to become a funding partner.

“Securing stable funding over the long term is key to ensure that standard setting is positioned for success in the future,” says Pamela Steer, CPA Canada’s president and CEO. “A broad base of funders will also address the funding requirements of the new Canadian Sustainability Standards Board and ensure the other recommendations set out in the IRCSS report are implemented. Establishing a separate legal entity for standard setting is a critical part in facilitating this new funding model.”

The International Sustainability Standards Board (ISSB) introduced two new sustainability standards: one that sets out general reporting requirements for disclosing sustainability-related financial information and another for addressing climate-related risks and opportunities. CPA Canada urges the federal government to support the Canadian Sustainability Standards Board (CSSB) in implementing these standards. Steer also notes that the CSSB will open a public consultation in March on three key documents that will shape Canada’s first sustainability standards.

“The CSSB’s initial consultation is an important development in the road to adoption of international sustainability standards in Canada,” she says.

“Standards enable organizations to deliver information vital for effective decision-making and providing confidence and stability in Canada’s capital markets and financial system,” Steer adds.

“Businesses and investors make decisions in a global context and adopting international sustainability standards, while also considering the Canadian-specific context will help to maintain Canada’s competitiveness within global capital markets.”


CPA Canada recommends introducing a national whistleblower reporting and protection framework to strengthen Canada’s efforts to combat money laundering.

“A comprehensive national framework would improve Canada’s regime, specific to anti-money laundering,” says Michele Wood-Tweel, CPA Canada’s vice-president, regulatory affairs. “Canada has committed to improving whistleblower protection, but it’s hard to make progress without a framework.”

A key concern is that federal provisions may not protect whistleblowers if they get sued provincially. Wood-Tweel says that Canada has a patchwork quilt of laws at the federal and provincial levels that aren’t harmonized and “don’t necessarily integrate,” creating gaps and risks for whistleblowers.

“Let’s say, for example, a money laundering matter is reported in good faith and indemnification is applicable under the federal anti-money laundering legislation,” says Wood-Tweel. “If the report turns out to be wrong, a civil lawsuit could result in a provincial jurisdiction if there’s no protection for the whistleblower there.”

Currently, there are no rewards (like cash) for whistleblowers in Canada’s federal anti-money laundering regime. Wood-Tweel notes that this may deter people from coming forward if they don’t see a path forward while doing the right thing.

“Canada hasn’t really amplified the value of whistleblowers within the AML regime,” says Wood-Tweel. “If you look south of the border, the United States has put rewards into the system to encourage whistleblowing. Many jurisdictions have holistic and comprehensive whistleblowing protections in place.”


Explore CPA Canada’s complete pre-budget 2024 recommendations here. Stay updated on the latest in tax, read why strong whistleblower protection is a must and learn how CPAs can lead ESG initiatives.

Photo caption: CPA Canada’s pre-budget recommendations also covers other important areas such as anti-money laundering and standard setting. (Getty Images)