– The CFIB is Canada’s largest association of small and medium-sized businesses with 109,000 members across every sector and region.
CANADA – An overwhelming majority (95 percent) of tax professionals — and small business owners themselves — say the proposed federal tax changes will hurt middle-class business owners and their families, according to a survey recently released by the Canadian Federation of Independent Business (CFIB).
“The government is trying to convince the public that these proposed changes are meant to support the middle class – that they are only targeting high-income business owners,” says Dan Kelly, CFIB President.
“The reality, however, is these are broad-brush proposals that are going to affect businesses at every income level across the country. Nine out of 10 business owners have told us that these tax changes are significant to their business.”
One of the government’s proposals would make it more difficult for small businesses, including family-run businesses, to share income with family members. According to the survey, this change would affect two-thirds of small businesses, including more than 50 percent who share income with their spouse.
Another proposal would limit a small business owner’s ability to keep certain investments in their business as a safeguard against future emergencies or economic downturns. Notably, 65 percent of small businesses hold some form of passive investment in their companies, most commonly income from property or land.
These two changes alone would affect the majority of small businesses in Canada.
“The implications of these changes for small businesses—and by extension to the national economy—are huge,” addS Kelly. “These aren’t loopholes for the wealthy, as the government claims. These are legitimate ways for small business owners to grow their business, ensure the stability of the firm during uncertain times, or to save for the retirement. Without these measures, businesses will not be able to create as many jobs for Canadians.”
Other findings include:
- 88 percent of business owner respondents indicated that the proposed changes will make it more difficult for their small business to grow and create jobs;
- 95 percent of tax practitioners say that the proposed tax changes will further complicate the tax system and increase the cost of tax compliance for their small business clients; and
- 94 percent of small business owners and 95 percent of tax practitioners do not support this set of tax changes.
Detailed survey results are available at the following link.
