Fall Economic Statement 2023: support for nonprofit housing, room to influence AMT, no gains on staple nonprofit sector priorities

On Tuesday, Minister Freeland’s presentation of the Fall Economic Statement (FES) to Parliament outlined a difficult economic and fiscal position for the federal government amid the country’s affordability and housing crises. The response is an overall tightening of spending with targeted investments to support low-income individuals and the development of more affordable housing units. 

A focal point is the announcement of $1 billion in new funding for the Affordable Housing Fund, meant to support nonprofit housing providers in the delivery of affordable housing. Formerly known as the National Housing Co-Investment Fund, it is likely a mix of low cost loans and fully non-repayable funding, and is a welcome recognition of the critical role nonprofits serve in addressing one of the most pressing issues facing our country. Additionally, plans are in motion to convert the Department of Infrastructure to the Department of Housing, Infrastructure and Communities. The new department will adopt the social policy aspect of the Canada Mortgage Housing Corporation’s mandate and link the government’s priorities on housing and homelessness to community resource and infrastructure planning. We are hopeful that this closer link between social policy and infrastructure development will eventually enable nonprofits to better access capital funding to improve their facilities. 

While the FES confirms changes will be made to the Alternative Minimum Tax (AMT) as announced in the 2023 Federal Budget, these plans will be “modified to take into account consultations and deliberations” that took place over the summer and fall. While the government continues to consider amendments to the AMT calculation, the sector will persist in its sustained advocacy to alert Parliament of the consequences of weakening of donations incentives (there is still time to ask your MP for support in protecting the sector’s revenues and ability to serve their communities). 

The FES also signals more progress on the development of the Clean Electricity Investment Tax Credit, a refundable credit available to non-taxable entities that potentially includes charities and nonprofits (eligibility details are still in development). Imagine Canada will explore applicability to sector organizations and engage as necessary as more details about this credit are developed in early 2024. 

Unfortunately, no commitments were made on the numerous low-cost, efficiency-focused policy priorities of the nonprofit sector. These include improved data collection on the sector to enable better decision-making; policy changes to make federal funding for nonprofits more equitable and effective; and the creation of a home in government for nonprofits that could break down silos and bring more cohesion to the federal government’s approach to the organizations that are supporting communities through this challenging period.