The Canadian Automobile Dealers Association (CADA) is responding to Prime Minister Mark Carney’s first federal budget, which places a strong emphasis on productivity, competitiveness, and business investment.
At the centre of the 2025 budget is a new “super-deduction,” a productivity-focused measure allowing businesses to recover eligible investment costs more quickly through an accelerated tax pathway. The goal is to make it more attractive for businesses to invest in equipment, technology, and operational improvements.
In a bulletin to its members, CADA welcomed the new measure, saying that it aligns with the sector’s long-standing call for policies that promote modernization and economic growth. The association said it will be engaging with federal officials to clarify eligibility, timing, and implementation details so that dealers can fully understand how and when they may benefit.
CADA expressed disappointment, however, at the government’s decision to eliminate the luxury tax on aircraft and boats while maintaining it on vehicles. CADA argues that the continued application of the tax unfairly penalizes consumers and imposes a disproportionate administrative burden on dealers, while generating less revenue than it costs to enforce.
“The vehicle luxury tax continues to place unnecessary strain on both consumers and retailers,” said CADA in the bulletin. “At a time when affordability pressures remain high, we will be making the case for revisiting this policy.”
As anticipated, the budget did not provide new details on federally regulated electric vehicle (ZEV) sales targets. The government’s 60-day review is still underway, with updates expected in stages. CADA confirmed it remains actively engaged to ensure that dealers’ interests are reflected in any new policies.
