2016 Federal Budget – Selected Tax Measures

On March 22, 2016, the Minister of Finance tabled Canada's 2016 Federal Budget (the 2016 Budget). This was the first budget presented by the newly-elected Liberal government, which won a strong majority in the fall 2015 federal election after nearly a decade with the Conservative party in power. The Liberals were elected on a platform that included promises to provide tax cuts and other incentives to the middle class, to be paid for by a series of measures aimed at increasing the tax burden on the wealthiest Canadians.

Some widely expected measures were not included in the 2016 Budget. The incoming government had said that it would increase the tax rate on employee stock option benefits. To the relief of many businesses, no changes to these rules were proposed. The Minister of Finance also confirmed in media briefings that the government has no plans to proceed with any changes to the employee stock option regime. In addition, the pervasive pre-budget rumours