Budget 2026 takes important steps on competitiveness, but execution remains key

OTTAWA, ON, Nov. 6, 2026 /CNW/ -- Canadian Manufacturers & Exporters (CME) welcomes the federal government's continued focus on strengthening Canada's competitiveness, encouraging business investment, and building economic resilience in Budget 2026.

"Manufacturing is a cornerstone of Canada's economy. To restore investor confidence and unlock the country's industrial potential, manufacturers need policy certainty and sustained government action. We are encouraged to see the Government of Canada taking our members' priorities seriously," said Dennis Darby, President and CEO of CME.

A central component of the government's competitiveness agenda is the Productivity Mega Deduction, announced in September and highlighted in Budget 2026. The measure builds on incentives introduced in Budget 2025, makes immediate expensing for eligible machinery and equipment permanent--a longstanding CME recommendation--and extends the benefits to a broader range of capital investments. This is an important step toward improving Canada's tax competitiveness, particularly as manufacturers compete for investment with the United States.

CME also welcomes additional measures to strengthen manufacturing, including expanded Scientific Research and Experimental Development (SR&ED) tax incentives to support commercialization and renewed funding for industrial energy efficiency through the SHIFT program. The budget also includes investments to strengthen Canadian nuclear supply chains and expand prefabricated and modular housing production.

CME is encouraged by proposed measures to help temporary residents already living and working in Canada transition to permanent residency. These initiatives could help employers retain skilled workers and bring greater stability to the labour market. However, manufacturers will need more details on how these measures will work in practice, including how regional and sectoral labour market needs will be reflected in their design and implementation. Robust domestic training and workforce development, alongside balanced immigration policies, will be essential to ensuring Canada has the skilled workers needed to support major investments and long-term economic growth.

While Budget 2026 includes meaningful measures to support investment and long-term competitiveness, Canadian manufacturers continue to face urgent challenges. Ongoing U.S. tariffs and trade uncertainty are disrupting supply chains, raising costs, and weighing on investment and employment. Restoring stability and predictability in Canada's most important trading relationship remains a critical priority. In the meantime, CME urges the federal government to ensure that tariff assistance reaches affected manufacturers quickly and remains flexible enough to respond to frequent changes in U.S. trade policy.

"Budget 2026 takes an important step on investment, and the Productivity Mega Deduction is a strong win for manufacturers," said Darby. "The direction is right, but now the government needs to deliver. The government must move quickly and turn these commitments into real projects, investment, and growth. CME stands ready to work with the government to make that happen."

ABOUT CANADIAN MANUFACTURERS & EXPORTERS

From the first industrial boom in Canada, CME has advocated for and represented member interests. 150 years strong, CME has earned an extensive and effective track record of working for and with leading companies nationwide. More than 85 per cent of CME's members are SMEs and collectively account for an estimated 82 per cent of total manufacturing production and 90 per cent of Canada's exports.

SOURCE Canadian Manufacturers & Exporters

FOR MORE INFORMATION: Julie Fortier, National Director, Communications, Canadian Manufacturers & Exporters, [phone], [email protected]