The federal government is moving to introduce new taxes on banks and insurers
Guy Cormier, Desjardins Group’s CEO, opposed Ottawa’s characterization of banks as a part of a bad industry that lined its pockets amidst a tough economy, following the implementation of new taxes on banks and insurers.
The head of the lender based in Quebec said that he supported the government’s attempts to help its constituents in the long run as it can lead to prosperity but was against putting the banking industry in a bad light.
“I’m not in opposition to what they present,” said Cormier. “But when we are shifting to a message that is, ‘We are a bad industry. We’re making too much money,’ I’m not there yet.”
Ottawa has revealed plans to implement new tax measures on leading banks with the Parliamentary Budget Officer stating that new levies may be able to generate up to $5.3 billion in the next five years.
Chrystia Freeland, the finance minister, has defended the hikes, noting that federal government aid provided during the pandemic had helped the banks with their balance sheets which allowed them to have significant profits.
However, recent financial filings from big banks in Canada showed a spike in expenses, a rise in capital requirements, and higher provisions that were potentially bad loans. The Canadian Bankers Association (CBA) has accused Ottawa of singling out banks in an attempt to support lower-income Canadians who were trying to cope with the high inflation.
Cormier stated that the banking industry had helped protect the financial help of Canadians during the pandemic through their moves in extending mortgage payment periods and supporting small businesses.
“I think the reward was to receive an extra tax after, because we are supposedly a financial institution making so much money, and we are an industry that is making so much money,” he said.
