Lexi Saldaña
Daily Herald
The Canadian Federation of Independent Business (CFIB) is calling on premiers for tax relief and internal trade reform for this week’s Council of the Federation meeting in Prince Edward Island.
The CFIB is Canada’s largest non-profit organization, supporting over 100,000 independent businesses on issues such as taxation, red tape regulation and business regulations. According to Keyli Loepkky, Senior Director of Interprovincial Affairs, global trade uncertainty, rising costs, weak consumer demand and limited access to capital are examples of causes that lead to small businesses shutting down.
“We’re in an entrepreneurial drought, and Canada cannot afford to keep losing entrepreneurs or discouraging business growth.” she said.
The organization is prompting premiers to focus on opportunities supporting entrepreneurship and economic growth. SeoRhin Yoo, CFIB Senior Policy Analyst for Interprovincial Affairs, explained an ‘entrepreneurial drought’ means “seeing business closures more frequently than openings.”
According to the CFIB, the federal small business tax rate has remained at nine per cent since 2019, and the Small Business Threshold has stayed at $500,000 since 2009.
“This is not at all keeping up with the times or the inflation that we’ve seen over the years,” said Yoo.
“Reducing the rate from nine per cent to six per cent would let small businesses keep up to $15,000 a year, and raising the threshold to $700,000 to meet inflation would let businesses keep up to $12,000 per year.” she added.
“So combined, all these cost savings, just imagining what small businesses could do with them, like reinvesting in their firm, reinvesting in their employees, as well as keeping costs down for consumers, could go a really long way.”
As for improving internal trade, Loeppky said businesses are left “bearing the consequences” when governments fail to deliver. According to CFIB data, 69 per cent of small businesses reported no improvement in the ease of doing business across provincial borders over the last 12 months and 16 per cent said conditions worsened.
“One of the clearest examples is direct-to-consumer alcohol shipping,” she said. “Despite broad support and repeated commitments, most provinces have yet to follow through and the deadline was set for May. They are now 50 days late.”
Yoo explained that small businesses expect deadlines to be respected. “It just makes small businesses unsure of what’s going to happen for more extensive agreements,” said Yoo, regarding the deadline setbacks. She added that instead of premiers recommitting to another timeline, accountability is the better solution. “Hold one another accountable, make the public transparent of where the holdup is,” she said. “Make these things public so that everyday Canadians also know where the holdup is being, and that we can give recommendations as to what can be done to overcome these things.”
The Council of the Federation meeting will be held in Charlottetown, Prince Edward Island from July 21 to July 23, gathering all provincial and territorial premiers to discuss major national issues, including health care, trade, affordability and public safety.
