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OTTAWA — Finance Minister Chrystia Freeland has ruled out raising taxes on the middle class in the upcoming federal budget — but won't say if corporations or the wealthy are in for the same treatment.

Freeland pointedly did not answer Tuesday when asked during a news conference about the prospect of new taxes on corporate Canada or others not part of the middle class.

Instead, she emphasized the "urgent" need to invest in things that are important to Canadians, such as housing and artificial intelligence. 

"Young Canadians (especially) need us to make those investments — investments in housing, investments in affordability, investments in productivity and growth," Freeland said. 

"We also really believe in the importance of making those investments in a fiscally responsible way."

Freeland has already said she would honour the new fiscal guardrails that were announced in the fall, including keeping the federal deficit below $40.1 billion.

But the new measures won't be financed by way of higher taxes on the middle class, she insisted. 

"We remain absolutely committed to being there for hardworking middle-class Canadians, and then we won't raise taxes on them," she said. 

Prime Minister Justin Trudeau has already made similar commitments. 

With the federal budget to be delivered April 16, questions are swirling about how the Liberals will pay for a recent raft of policy proposals, including a national school food program.

The Liberal government has been facing mounting pressures to rein in spending in order to avoid fuelling inflation or delaying rate cuts by the Bank of Canada. A slow economy is also weighing on government revenues, meaning there's fewer dollars to put toward new initiatives. 

Given the fiscal bind the Liberals find themselves in, some progressives have called on the federal government to use its taxing power to generate more revenue. 

New Democrats are pushing the federal government to reverse Harper-era corporate tax cuts to fund new policy measures in the budget. The former Conservative government reduced the corporate tax rate from 22 per cent to 15 per cent. 

The House of Commons finance committee has also recommended a windfall tax on companies in all sectors that generate "oversized" profits during crises, as well as grocery giants, to fund another doubling of the GST rebate. Conservative MPs on the committee did not support the pre-budget recommendations. 

The idea of imposing an "excess profits" tax on Canadian grocers gained momentum post-pandemic as consumers saw their grocery bills skyrocket. Last fall, Prime Minister Justin Trudeau threatened to use tax measures to punish grocers if they did not co-operate with the government's efforts to bring down food inflation.

Since then, the government has expressed disappointment with the grocers' efforts to stabilize prices.

As cost-of-living issues continue to drive politics, the Trudeau Liberals have been touring the country over the last two weeks to make announcements on measures included in the federal budget.

Traditionally, federal governments have carefully guarded  budget secrecy until the day the spending blueprint is presented in the House of Commons, notwithstanding a typical array of leaks to the media.

This time, however, the government has opted instead to explain to Canadians ahead of time what it's doing to help them, Freeland said.

"Very often, on budget day, all of you (journalists) are met with a flurry of announcements," she said. 

"Laying out our plan step-by-step, day-by-day is an opportunity for Canadians to hear from us what it is we're doing — and for there to be a real, thorough, reasoned, fact-based debate about a number of the measures. 

"And I think that's a really good thing."

This report by The Canadian Press was first published April 9, 2024.

Nojoud Al Mallees, The Canadian Press