Carney holds news conference after announcing plan to hike military spending
Prime Minister Mark Carney takes media questions after announcing earlier Monday that Canada would meet NATO's defence spending target this fiscal year.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Globe and Mail
20 minutes ago
- Globe and Mail
What Canadian investors need to know about the Trump tax bill
If the first six months are any indication, the reign of U.S. President Donald Trump is going to be a rough one for Canadian investors. First, the stock market plunged earlier this spring as Mr. Trump's tariffs started a global trade war. Stocks have mostly recovered, but a new threat has emerged in the form of legislation that would allow Washington to ramp up the taxation of Canadians holding U.S. stocks. The One Big Beautiful Bill Act is not yet law – it passed in the U.S. House of Representatives by a single vote but must still pass in the Senate – and may change in scope. For now, it has the potential to more than double the tax applied to dividends from U.S. companies received by Canadian investors and corporations. The ultimate effect of the tax changes could be costly in total but perhaps not so bad on an individual basis. Regardless, it's too early to make changes in your investment portfolio. 'Currently, we're not making any moves, and I'm recommending everyone do the same thing and just wait to see what the information actually is,' said Justin Bender, a portfolio manager at PWL Capital. 'Then we can assess and see if there's any changes necessary.' Wealth managers brace for proposed U.S. tax bill's impacts on Canadian clients What's in Trump's big budget bill? From cuts to taxes and Medicaid, here's what to know Ultimately, Section 899 of the legislation could introduce a withholding tax of 20 to 50 per cent of dividends received by Canadians. There are estimates that this extra tax could cost individual investors, pension funds and others billions of dollars. The point of Section 899 is to give the U.S. a weapon to punish what it considers to be unfair taxes in other countries. Thought to be a target is our digital services tax, which mainly applies to U.S. tech giants generating revenue in Canada. Estimates from Mr. Bender show a worst-case additional drag on returns of 0.46 percentage points from U.S. stocks and U.S. equity exchange-traded funds when the higher withholding tax is fully phased in over four years. Think of this cost as being in addition to the management expense ratio of an ETF or mutual fund. If your return from a U.S. equity fund was a net 10 per cent with the management expense ratio (MER) included, then a higher withholding tax could ultimately leave you with as little as 9.54 per cent. Note that fund returns are always published on a net basis, with the MER included and, where applicable, foreign withholding taxes already deducted. Under existing U.S. tax law, there is a base withholding tax rate of 30 per cent for foreign investors holding U.S. stocks. A Canada-U.S. tax treaty generally reduces this rate to 15 per cent. No withholding tax applies to U.S. dividends paid into registered retirement savings plans and registered retirement income funds by U.S.-listed stocks and ETFs. There's no clear sense of whether this exemption would continue to apply under Section 899. In a non-registered account, you can offset the 15-per-cent withholding tax by claiming an offsetting foreign tax credit. In a TFSA, registered education savings plan, first home savings account or registered disability savings plan, the withholding tax cannot be recovered; it is also non-recoverable in RRSPs and RRIFs if you hold a Canadian-listed U.S. equity ETF. Canadian investors have a massive level of exposure to U.S. stocks directly and through funds. About $60-billion is invested in just four TSX-listed ETFs that track the S&P 500 index. But investing in the S&P 500, and the even more tech-focused Nasdaq, is much more about growth than dividend income. The dividend yield on the S&P 500 right now is about 1.3 per cent, half the level of the yield on Canada's S&P/TSX composite index. 'It's very low, which is why this tax maybe isn't as much of an issue as people are making it out to be,' Mr. Bender said. 'Some extra withholding taxes are probably not going to blow up your financial plan.' Mr. Bender added that the impact is further diminished by the fact that most investors have diversified their U.S. exposure with bonds and Canadian stocks, plus international markets in many cases. Investors who use ETFs for exposure to U.S. stocks can buy funds listed on U.S. exchanges as well as those located in Canada. Among Canadian-listed funds, there are those that hold U.S. stocks directly and those that are effectively a wrapper for a U.S.-listed fund in the same corporate family. Mr. Bender said each of these three ETF types would be affected similarly by higher U.S. withholding taxes. Are you a young Canadian with money on your mind? To set yourself up for success and steer clear of costly mistakes, listen to our award-winning Stress Test podcast.
National Post
21 minutes ago
- National Post
Danielle Smith reignites feud with Guilbeault over his plans for Canada's national parks
OTTAWA — Steven Guilbeault may no longer be federal environment minister, but Alberta Premier Danielle Smith says she still sees him as a threat to the province's oil and gas industry. Article content Smith said on her weekly radio show this weekend that Guilbeault, now heritage minister, has an 'overt motive' to establish new federally-protected parks in the path of pipelines and other energy infrastructure. Article content Article content Article content She added that she wouldn't consent to the creation of any new federal parks in Alberta. Article content 'I do not want to see one additional acre of territory that's within Alberta turned into a federal park … we certainly don't need Steven Guilbeault telling us what is important to protect in Alberta,' said Smith. Article content 'If there is critical habitat that Albertans want to protect … we'll put in provincial parks.' Article content Guilbeault, a former Greenpeace activist, was shuffled out of the environment portfolio in March by Prime Minister Mark Carney but kept his role as minister responsible for Parks Canada. Article content This puts him in charge of implementing the Liberals' campaign promise to create at least 10 new national parks and protect 30 per cent of public lands by 2030. Article content According to Parks Canada's website, the agency is currently vetting four proposed national parks and protected areas, including a northern Manitoba watershed on the Hudson Bay, one possible destination for future oil shipments. Article content Neither Guilbeault's office nor Parks Canada gave an immediate response to Smith's comments about future federal parks blocking energy infrastructure. Article content This isn't the first time that mistrust has flared between Smith's United Conservative Party government and Parks Canada. Article content Greater Edmonton UCP MLA Brandon Lunty put forward a private member's bill in late 2023 barring municipalities and Parks Canada from expanding urban parks without the province's consent. The bill was signed into law in 2024. Article content Lunty told the National Post that he decided to champion the bill when he caught wind of bilateral discussions Edmonton's city council was having with federal officials about an urban park in the capital region. Article content 'It seemed like they were down the road a bit on those conversations and I kept coming back to the question of, well, what about the provincial perspective on this?' said Lunty.
Toronto Sun
25 minutes ago
- Toronto Sun
EDITORIAL: Meeting NATO's 2% target the right move
Canadian Prime Minister Mark Carney walks as he greets Canadian troops of the 4th Canadian Division as he attends a tour of the Fort York Armoury in Toronto on June 9, 2025 in Toronto. Carney has pledged to meet NATO's 2% spending pledge this year. Photo by Cole Burston / GETTY IMAGES Provided it is done competently, we agree with Prime Minister Mark Carney's announcement Monday that Canada, at long last, will meet its NATO commitment to increase military spending to 2% of gross domestic product (GDP) in this fiscal year. This advertisement has not loaded yet, but your article continues below. THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. SUBSCRIBE TO UNLOCK MORE ARTICLES Subscribe now to read the latest news in your city and across Canada. Unlimited online access to articles from across Canada with one account. Get exclusive access to the Toronto Sun ePaper, an electronic replica of the print edition that you can share, download and comment on. Enjoy insights and behind-the-scenes analysis from our award-winning journalists. Support local journalists and the next generation of journalists. Daily puzzles including the New York Times Crossword. REGISTER / SIGN IN TO UNLOCK MORE ARTICLES Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account. Share your thoughts and join the conversation in the comments. Enjoy additional articles per month. Get email updates from your favourite authors. THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK. Create an account or sign in to continue with your reading experience. Access articles from across Canada with one account Share your thoughts and join the conversation in the comments Enjoy additional articles per month Get email updates from your favourite authors Don't have an account? Create Account That's five years ahead of Carney's previous promise to meet the 2% target by 2030. We're so far behind — Canada currently spends 1.4% of GDP on defence annually — that NATO is already considering a new target for member nations to spend 5% of GDP on defence. Canada's failure to meet the 2% target, set by NATO in 2006, has been a long-standing national embarrassment. It has eaten away at our credibility and our effectiveness on issues of global security and international conflicts. It has justifiably upset many of our NATO allies for not pulling our own weight and, most recently, angered U.S. President Donald Trump who, on this issue, has a valid point. At the end of the Second World War, Canada had the world's fourth-largest navy after the U.S., U.K and former Soviet Union. This advertisement has not loaded yet, but your article continues below. At the end of the Korean War, Canada was spending 7% of GDP on defence. Today, we have members of our military relying on food donations to make ends meet while being sent into armed conflicts — where they continue to serve honourably — with aging and obsolete equipment. This is a national disgrace. Canada's submarines, ships, aircraft, military vehicles and artillery are all in desperate need of upgrading, as is our military presence in the Arctic, given the growing interest in its mineral resources by hostile countries such as Russia and China. No country can claim to be a sovereign nation unless it has the ability to monitor and, where necessary, counter incursions into its territory. Our concern is with Carney's pledge to 'ensure that every dollar is invested wisely, including by prioritizing made-in-Canada manufacturing and supply chains.' Read More That's not because of the intent — we agree with it — but because there are so many examples of military spending that have turned into fiascoes and boondoggles by previous governments. We're also concerned that Carney is making this major announcement on defence spending in advance of this year's federal budget and how the increased spending on defence will impact the government's overall finances. RECOMMENDED VIDEO Olympics Columnists Celebrity Olympics Canada
