The Québec Government tabled a third consecutive balanced budget on Tuesday. The 2017-2018 budget provides for significant investment in many sectors (including education), as well as a reduction of the tax burden on individuals.

Budget Highlights:

  • Third consecutive balanced budget.
  • $3.4 billion earmarked for educational success and higher education.
  • $3 billion investment over two years in the health sector.
  • More than $1 billion decrease in the tax burden on individuals through the retroactive elimination of the “health contribution” that will apply to the 2016 taxation year, and the increase in the zero-tax threshold.
  • A $830 million investment to stimulate research and innovation.
  • A $1.2 billion investment in a range of measures to foster economic development in the regions.

Points of interest to retailers:

The 2017-2018 budget does not provide for any further increase in consumer taxes, including taxes on alcoholic beverages and tobacco products.

When the government announced its minimum wage increase policy earlier this year, the Minister had shown some interest in mitigation measures for businesses affected by the increases planned over the next four years. However, the 2017-2018 budget does not contain any such measures.

The budget announces support for the food processing industry ($42 million investment over five years within a $159 million agriculture envelope). Detailed measures will be announced at the Food Summit in the fall of 2017.

The 2017-2018 budget confirms the reduction in the general corporate tax rate announced in the 2015 budget (0.1 percentage point per year as of January 1, 2017, to reach 11.5% by January 1, 2020).

Next Steps:

RCC will continue to lobby the government to establish mitigation measures for businesses affected by the planned increases in the minimum wage.

RCC will continue to work with industry partners to prepare for the fall 2017 Food Summit and to ensure that the Voice of Retail is heard by government as it works on its future agri-food policy.

The detailed Québec Economic Plan is available here.or at: http://www.budget.finances.gouv.qc.ca/budget/2017-2018/en/documents/EconomicPlan_March2017.pdf#page=387

If you have any questions or concerns, please don’t hesitate to contact: Jean-Luc Benoît, Director, Government Relations (Québec) at: [email protected] or 514-316-8913