The bottom fell out in April.
On April 16, the federal government unveiled its 2024 budget, a 416-page document containing billions of dollars in funding commitments and policy initiatives for tech.
Most of it was ignored due to the unexpected insert of a capital gains tax inclusion rate that, to many, seemed directly targeted at those who finance, build, and work for Canadian tech companies. The announcement was a shock to those hoping for meaningful updates on past tech commitments, such as open banking, SR&ED, and the forlorn Canada Innovation Corporation. It was also a shock to ISED employees BetaKit spoke with who suddenly found their work on what might have been considered a weighty innovation budget completely overshadowed.
“This has been a lost decade of innovation policy in Canada and the signals have revealed themselves to be incompetency and an inability to get things done.”
Ben Bergen, CCI
The response, if not unanimous, was swift and loud.
Over 2,000 prominent tech leaders signed a letter against the changes, with some calling the decision a “mistake,” while others opined that it was “Time to start your next company in the US.”
The reaction crystalized a looming malaise over several headwinds faced by the country and diminished faith in our current government’s capacity to face them, prompting BetaKit to launch a national Town Hall series focused on Canadian productivity, innovation, and optimism.
The kicker? Eight months later, the feds have yet to make the capital gains tax inclusion rate increase law, leaving the CRA to move forward under the assumption that it will eventually come to pass. The ongoing Liberal political crisis, exacerbated by its finance minister resigning on the morning of the Fall Economic Statement, will more likely result in an election, the prime minister’s resignation, or both. It is not often you get to call the Canada Revenue Agency optimistic, but here we are.
Whether or not this government survives the next election will not do much to improve the legacy of its innovation file, which has been marked by indiscriminate spending and unfinished policy commitments.
“This has been a lost decade of innovation policy in Canada and the signals have revealed themselves to be incompetency and an inability to get things done,” Ben Bergen, president of the Council of Canadian Innovators, told me.
#CDNTECH 2024
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