Emokhare Paul Anthony
Daily Herald
The Canadian Federation of Independent Business (CFIB) says nearly one in five small businesses dealing with tariff costs won’t last more than six months if nothing changes.
“Small businesses are running out of options,” said Brianna Solberg, CFIB Director for the Prairies and Northern Canada. “They are trying their best to absorb the costs, but if nothing changes, they will be forced to make tough decisions.”
Solberg said new data from the CFIB reveals that small businesses are being hit hardest by U.S. and Canadian tariffs on steel and aluminium at 59 per cent, as well as Canada’s own retaliatory tariffs on other U.S. goods 58 per cent. Nearly one-third of Canadian SMEs will be negatively affected by the loss of the $800 U.S. de minimis exemption.
“The worst outcome for Canada in the trade war is a bad deal, but the second worst outcome is the never-ending uncertainty small business owners have been wrestling with for the past six months,” Solberg said in a press release. “The federal government needs to provide some stability and return tariff revenue to help small businesses.”
Solberg said the data shows that the trade war is squeezing small businesses on every front. Roughly 62 per cent face higher expenses while 48 per cent are also seeing lower revenues. Another 41 per cent are seeing supply chain disruptions, and 31 per cent report pausing investments.
“We’ve suggested several options, including temporarily reducing the federal small business tax rate to zero or a tariff rebate designed on earlier models, like the carbon tax rebate,” said Solberg.
Solberg said nearly one in five 19 per cent small businesses dealing with extra tariff costs report that they will not be able to last more than six months if the tariff status quo remains and around 38 per cent said they would last less than a year.
“The trade war’s impact on Canada’s small businesses should be top of mind for the government as Canada continues its negotiations with the U.S,” Solberg added.
In Prince Albert, Chamber of commerce CEO Patty Hughes said she would really like to see the government really step up and champion small businesses struggling with the tariffs. While the CFIB focused on steel and aluminum tariffs, Hughes said most businesses in the Prince Albert area are more concerned about Canola tariffs.
“The Canola industry is a massive industry, not only for our province, but for our country,” she said. “There is a trickle down affect.”
Hughes and her husband farm in the area, in addition to her role with the chamber. She said their margins have been “completely erased” and many farmers have already decided what crops to plant this year so it’s too late to change course.
That’s going to impact non-Agricultural businesses, she said, as farmers and their families spend less money in the community.
“That means there’s not that extra dollar to go out to that restaurant. There’s not that extra dollar to spend on the extras in our life,” she said. “They’re just covering their bills. Will our businesses here feel an impact? Absolutely they will. Farmers will be making their personal decisions a whole lot differently.”
Hughes said she expects some local businesses will be more cautious with less revenue coming in. That could mean restrictions on hiring or business expansions.
As someone in the farming sector, Hughes said she’s happy with how the provincial government has responded to the tariffs, but hopes the federal government will step up as well.
On Thursday, Kody Blois, the parliamentary secretary for Prime Minister Mark Carney held a press conference with Premier Scott Moe about the tariff situation. Blois told reporters the federal government realizes the Chinese tariffs are a threat to Saskatchewan producers. He said the government would continue to negotiate with China, but Canada must also look to other markets.
–with files from Jason Kerr/Daily Herald
