More than three-quarters (77 per cent) of small businesses want governments to focus on addressing rising prices and the cost of doing business this year, while another 74 per cent want governments to reduce the overall tax burden, according to a recent survey from the Canadian Federation of Independent Business.
The survey went on to show that, if governments reduced the overall tax burden, more than half (57 per cent) of small businesses said they would increase employee compensation, such as wages and benefits.
As of Jan. 1, employers faced an increase to their payroll budgets due to employment insurance (EI) hikes and adding a second earnings limit to Canada Pension Plan (CPP), thereby hiking CPP, the CFIB said.
OBJ360 (Sponsored)
Last month Ottawa Salus launched “Opening Doors to Dignity,” a $5-million campaign to construct a 54-unit independent living building on Capilano Drive. Set to open in late 2025, this innovative
Philanthropy can be about more than doing something positive for others. It can also be a way of righting old wrongs. When Patricia Saputo was in her early 20s, she
This year, total employer contributions for CPP and EI alone could amount to $5,524 per employee, according to CFIB.
“That’s a significant increase in the cost of labour for employers and puts them in an even tougher position, especially when many employees will be looking for a salary increase at the beginning of the year. Business owners may be forced to rethink their wage and hiring plans for 2024. And that is over and above other cost pressures small businesses are dealing with right now, such as the looming Canada Emergency Business Account repayment deadline,” said Corinne Pohlmann, executive vice-president of advocacy at CFIB.
CFIB is calling on Ottawa to work with the provinces to offset the CPP hikes, implement a 50:50 split in EI premiums between employers and employees, or introduce a refundable credit to offset the rate increases for small businesses.
The CFIB also mentioned that the carbon tax is set to increase to $80 per tonne on April 1.
“Ottawa is sitting on $2.5 billion in carbon tax revenue that it promised to return to small businesses, at the same time it’s providing large subsidies to multinational corporations, while small businesses and Canadians are struggling with the increased costs of living,” Pohlmann said.
“Ottawa must wake up and realize the impacts its recent decisions on CEBA and rate hikes will have on small businesses’ ability to continue to operate, much less compete.”
Not a ‘full-blown’ crisis
In December, another of the country’s largest business groups said most merchants it surveyed are on track to pay back their pandemic loans by the January forgiveness deadline.
The Canadian Chamber of Commerce said that nearly half of the 16,000 small businesses it heard from in its fourth-quarter survey on business conditions had received a CEBA loan.
The chamber said more than 30 per cent of businesses that took out loans reported they have already paid them back in full. Two out of three merchants with outstanding balances plan to pay them off by Jan. 18, 2024 – the federal government’s deadline for forgiving a portion of the loans.
“This means that, altogether, approximately 76 (per cent) of CEBA loans are likely to be repaid, with variation across sectors,” the Ottawa-based organization, which represents more than 200,000 businesses across the country, said in a news release.
The chamber said the survey offers a different narrative than the one from organizations such as the CFIB, which said in November that two-thirds of small businesses do not have the money to repay their CEBA loan and half of those have no capacity to borrow in order to secure the forgivable portion.
“The truth is that CEBA loan repayments may not be the full-blown crisis it’s been presented by many to be,” the chamber said.
The most recent CFIB survey results are based on 2,966 responses from small businesses in December 2023 and 3,265 responses in November 2023.
