Small Business: The heart of Canadian communities

Transcription

1 Small Business: The heart of Canadian communities Presentation ti to the Standing Committee on Finance February 16, 2016 Dan Kelly, President of the Canadian Federation of Independent Business

2 About CFIB Represents independent d business 109,000 business members across Canada Non-partisan, not-for-profit f organization Deals with federal, provincial and municipal issues Represents all sectors, all regions One member = one vote 2

3 Business Barometer Index and GDP (January 2016) Source: CFIB, Business Barometer, 712 responses, January

4 Business Barometer: Full-time staffing intentions, next 3 months Source: CFIB, Business Barometer, 712 responses, January

5 High Priority i Issues Total tax burden 75 Government regulation and paper burden 69 Government debt/deficit 61 Cost of local government Shortage of qualified labour Employment Insurance Workers' compensation 38 Provincial labour laws Availability of financing Other 16 Source: CFIB, Our Members Opinions survey, January-June 2015, n=18,385. 5

6 1. Ensure continued access to the Small Business Tax Rate Consider implementing the reduction at a faster pace (i.e. over two years instead of four). Maintain access to the small business rate for all small businesses, including professionals (e.g. doctors, dentists) 6

7 2. Reject any plans to increase CPP/QPP premiums. Impact of immediate mandatory increase in CPP/QPP premiums - Small business owners (% response) Increases pressure to freeze/cut salaries 67 Reduces investments in my business 46 Decreases the number of employees 35 Helps my employees/me save more for retirement than originally planned Reduces the need to offer alternative retirement plans in my workplace Don t know Fu ture seniors would ldh ave more income to spend din my business No impact Other 5 Source: CFIB CPP survey, 7,889 responses, July

8 2. Business Responses to ORPP An Ekos poll conducted for the Government of Ontario found that: 57% of businesses are opposed, 23% are supportive (mirror image of public); Nearly six in ten businesses expect to be negatively affected (only 16% positive) Only 10% see increased ability to retain employees Other concerns all very similar: costs, business too small 8

9 2. Business Responses to ORPP In response, most firms suggest they face cost-cutting: 59% expect to cut/freeze wages; 54% of businesses are considering a hiring freeze in response to ORPP; 2/3 of businesses expect to make other operating cuts. Wage and hiring freeze much more likely to be pursued Other concerns mirror the survey options: Worried about cost, ability to implement but also to sustain the cost over long term; More generally concerned about government management of the plan. 9

10 3. Make the EI system fairer for employers Which form of taxation affect the growth of your business the most? (% response) Source: CFIB, 2015 Federal budget and Elections survey, 6,876 responses, November

11 3. Make the EI system fairer for employers Yearly EI Premium Rate from 2015 to 2016 Group Employee Employer Employer (with Small Business Job Credit applied until 2016) Source: Canada Revenue Agency, 11

12 4. Continue to make red tape reduction a priority Expand the baseline count to include rules 40,000 35,000 found in policy and 30,000 legislation. 25,000 Set a 20 per cent red 20, tape reduction target 15,000 from baseline count 10,000 5,000 in 3 years. Expand the use of the small business lens to legislation l i and policy ,308 The Workers Compensation Act in BC included a mere nine regulations but this translated into 35,308 regulatory requirements. 12

13 5. Simplify CRA dealings with SMEs Move forward and implement recommendations for the review of rules around active vs. passive income. Ensure the Small Business Consultation CFIB/CRA forum moves forward as it will be a good opportunity for the new government to engage with stakeholders. 13

14 6. Make it easier for business owners to pass businesses on to the next generation Expected Business Exit Date (% response) Source: CFIB, Survey Results on Small Business Succession Planning, 8,303 responses, November

15 7. Better control public sector wages, benefits and pensions Public sector salary and benefits % advantages over private sector Federal gov't Provincial gov't Municipal gov't Salaries & benefits (pensions, working hours) Education Salaries only (adjusted for occupation, age, education) Healthcare Urban Transit Canada Post Source: CFIB, Wage Watch Report, March h

16 Best Advice from Small Business Owners How effective would the following measures be at helping to strengthen your business performance? (Select one for each line) (% response) Reducing the current federal small business corporate income tax rate Lowering EI rates Freezing CPP/QPP premiums Increasing the generosity of direct grants or subsidy programs for businesses Reintroducing a Home Renovation Tax Credit Reintroducing accelerated CCA rates on technology and/or manufacturing equipment Very effective ect e Somewhat effectiveect e Not effectiveect e Don't know/no o answer Source: CFIB, 2015 Federal budget and Elections survey, 6,876 responses, November