The Canadian Federation of Independent Business is looking for look for much-needed relief from cost increases and post-COVID debt in this month’s federal budget.
“Small businesses are facing higher costs across the board, rising interest rates and lack of staff, at a time when many still haven’t recovered from the impacts of the pandemic. This leaves many of them in a precarious financial position, without an ability to repay their staggering debt loads,” said Corinne Pohlmann, CFIB’s senior vice-president of national affairs. “The federal budget must ensure small firms have a pathway to recover and grow in the challenging months ahead.”
As of last month, over half (57%) of small businesses have not repaid their pandemic-related debt, at an average of $105,000, and only 48% have seen their sales return to pre-pandemic levels.
To help small businesses recover and thrive, CFIB recommends the government:
- Extend the repayment deadline for the Canadian Emergency Business Account (CEBA) to December 2024 or even 2025, consider additional debt forgiveness and implement an appeal process for CEBA loan recipients that are now deemed ineligible
- Pause carbon pricing at the current level
- Lower the federal small business tax rate from 9% to 8%, at least for the next two years and increase the small business deduction threshold from $500,000 to $600,000, followed by indexing it to inflation
- Introduce a targeted Employment Insurance (EI) credit for small business
- Deliver on the promise to lower credit card fees for small business
- Create a pathway to permanent residency for lower-skilled temporary foreign workers
- Extend the Accelerated Capital Cost Allowance (ACCA) and make Immediate Expensing of up to $1.5 million permanent to help with capital investments
“Small businesses are doing everything they can to dig themselves out of the hole the pandemic put them in, but the current economic challenges are not making that easy. They want the government to listen to their concerns and take action now. The federal budget must speak to small business priorities and put appropriate policies in place to ensure a strong small business recovery across all sectors and regions,” added Dan Kelly, CFIB president.
The federal budget will be delivered on March 28.