Federal budget 2017
2017 Federal budget highlights
Peter Bowen, CPA, CA
Vice-President, Tax and Retirement Research
The big picture On March 22, 2017, the federal Liberal government delivered its second annual budget. The biggest news for Canadian investors this year was not necessarily what was in the budget, but what was not included in it (e.g. the capital gains inclusion rate). Faced with global uncertainty and slower‐than‐expected domestic economic growth, the bulk of measures in this budget are aimed at skills development and investing in innovation to grow the economy in the long term. Key items Tax 
Capital gains inclusion rate – Despite months of wide speculation that the capital gains inclusion rate would be increased, it will remain at 50%. There are also no changes to personal or corporate tax rates. 
Closing tax loopholes – The government reiterated its commitment to close tax loopholes that disproportionately favour the wealthy, including, among others, tax‐planning strategies for private corporations. It intends to release a paper in the coming months that will set out the nature of these issues, as well as proposed policy responses. 
Tax credits – The public transit tax credit will be eliminated as of July 1, 2017. There were a number of minor changes to other tax credits. Page 1 of 2
795866.1.0
03/17 SAL 22411
Canada Savings Bonds 
The Canada Savings Bonds program – Created in 1946, the Canada Savings Bonds program will cease in 2017. Sales of the bonds will be discontinued in recognition of the availability of other investment vehicles, including mutual funds. Innovation plan 
Policy measures – A new Venture Capital Catalyst Initiative was announced that will help increase late‐
stage capital for Canadian entrepreneurs. There were a number of other measures, including $2.7 billion for skills development, $2.2 billion for clean technology research and development and $125 million for pan‐Canadian artificial intelligence strategy. Fidelity Investments Canada will continue to monitor and provide analysis on issues that matter to financial advisors and investors. As at March 22, 2017 Views expressed regarding a particular company, security, industry or market sector are the views of that individual at the time expressed and do not necessarily represent the views of Fidelity or any other person in the Fidelity organization. These views may not be relied upon as investment advice, nor are they an indication of trading intent on any Fidelity Fund. These views are subject to change at any time based upon markets and other conditions, and Fidelity disclaims any responsibility to update such views. ©2017 Fidelity Investments Canada ULC. All rights reserved. Fidelity Investments is a registered trademark of Fidelity Investments Canada ULC. Page 2 of 2
795866.1.0
03/17 SAL 22411