411 Blog

What Canada’s Liberal Win Means for Small Business

Parliament 2

 

Throughout the longest election campaign since 1872, one of the major themes discussed and debated was small business. Now that the Liberal party has won a majority government, Canadians await big changes to our country’s small business environment, as promised during the campaign. This post will outline some of the changes we can expect to see over the next four years and how they will impact Canada’s small business owners.

Corporate Tax

The most significant change that our new government will bring to small businesses is a lower corporate tax rate. Over the next four years, the Liberals have promised to bring the small business tax from the current 11% to 9%. This will provide relief to small businesses in our lagging economy.

Employment Insurance (EI)

The Liberal government also promises Employment Insurance (EI) reform. They have committed to lower employee premiums from $1.88 per every $100.00 earned to $1.65, and to reduce employer premiums from $2.63 to $2.31, starting in 2017. Like a lower tax rate, this will also mean cost savings for small businesses owners and their employees nationwide.

Job Training

The Liberals have decided to maintain the Job Grant. They will also re-instate the Labour Market Development Agreements to provide the provinces and territories with $500 million per year for skills training. This will ensure small business owners are able to find and employ skilled workers.

Long-Form Census

The Liberal Government has also stated they will bring back the mandatory long-form census, which was replaced in 2010 with a voluntary household survey. In the past, the long-form census has proven to be a vital form of market research, so bringing it back is good news for many small business owners.

Canada Pension Plan (CPP)

The main concern affecting small business is the plan to negotiate with the provinces and territories to increase CPP premiums. Small business owners worry this added cost will put strains on their budgets and may result in wage cuts and layoffs. Although this increase will be phased in over time, it concerns small businesses as the increase is something they will have to account for in the future.

Some small business owners, however, are choosing to have a positive outlook on the increase. They say that although the added costs are not ideal, it will lead to more comfortable retirement living for the valuable employees of Canadian small businesses.

So, while many of these plans will result in cost savings, others will lead to added costs for small businesses. Ultimately, change is headed for small business in Canada and you may have to make adjustments to your own business to accommodate what’s to come.

Laura has a B.A. in Honours Communications Studies from McMaster University and is currently enrolled in Humber’s Public Relations Postgraduate program. She is passionate about writing and local business, so this blog is the perfect combination of the two.