As Canada heads into a federal election, businesses are keenly watching the political developments, eager to understand how the outcome may shape the future of the economy. Todd Hirsch, an economist, speaker, and author based in Calgary, recently shared his insights on the impact of elections on business with Canada’s Entrepreneur. His analysis offers valuable perspectives on the challenges and opportunities that lie ahead for Canadian businesses.
Hirsch pointed out that while politics and economics are closely linked, they are not the same. He explained that political decisions do influence the economy, but the impact is often overstated, as politicians are given too much credit or blame for economic outcomes. Nevertheless, policies can have a real effect, and during this election, many businesses are looking for a shift after a decade of Liberal governance, especially in the context of ongoing global issues like tariffs and trade tensions.
Regarding Canada’s energy sector, Hirsch highlighted that businesses are seeking clarity and stability when it comes to infrastructure projects, particularly pipeline development. He noted that both the Liberal and Conservative parties have expressed support for speeding up the approval process for such projects, which could lead to greater investment in the sector. In other industries, like manufacturing, businesses are eager to understand which party will best handle trade relations with the U.S., especially as tariffs loom.
The carbon tax, a key issue in the election, remains uncertain. While Conservative leader Pierre Poilievre has vowed to eliminate the carbon tax, Hirsch suggested that the outcome of the election would likely determine its future. He believed that while consumers may see the tax reduced or eliminated, businesses might still face some form of it, though the specifics remain unclear.
Hirsch also discussed how political uncertainty often causes businesses to pause their decision-making processes. Companies tend to delay major investments or long-term planning until the election results are in and the future political landscape becomes clearer. He noted that businesses are more comfortable when there is stability and clear direction from the government, even if it means accepting certain regulations that might not be ideal. What they cannot tolerate, however, is the constant shifting of rules and policies.
Investors are similarly cautious during election periods, as they too seek a stable environment in which to make investments. Hirsch emphasized that certainty is highly valued in both business and investment decisions, and the outcome of the election will play a significant role in shaping the level of trust and confidence in the market.
Lastly, Hirsch pointed out that tax policies, particularly those affecting businesses, will be a critical factor for companies moving forward. While both major parties have proposed cuts to personal income taxes, it remains to be seen whether either will introduce significant reforms to business taxes. Policies that stimulate investment, such as allowing businesses to write off capital investments more quickly, could be key to encouraging economic growth in the coming years.
In the weeks ahead, Canadian businesses will continue to monitor the election, hoping for policies that foster stability, reduce uncertainty, and support long-term investment.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024 and 2025.
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