Taxes, labour and transportation costs lead small business concerns.
Charlottetown, October 31, 2024 — As the Prince Edward Island Legislative Assembly prepares to reconvene on November 5, the Canadian Federation of Independent Business (CFIB) is calling on the provincial government to address pressing issues that are impacting small businesses across the province.
"Prince Edward Island's small businesses are grappling with significant challenges, from high operational costs to transportation barriers, all while facing reduced consumer demand," said Frederic Gionet, Senior Policy Analyst at CFIB. "It's vital for the government to implement policies that alleviate these pressures and support the growth of our local businesses, and, even more importantly, avoid adding new burdens."
According to recent CFIB data, a considerable number of PEI small businesses are operating under financial strain, with nearly 1 in 5 owners reporting they are in a weak or critical condition. This has led to nearly half (48%) of the province’s small business owners to advise others against starting a business right now, citing the high cost of doing business as the primary reason.
Key issues weighing heavily on PEI’s small businesses include:
- Freezing tax rates: Maintaining current small business tax levels at 1% to provide stability for small businesses.
- Increasing the Small Business Tax Rate Threshold: Raising the threshold from $500,000 to $700,000 of net income, allowing more income to be taxed at the lower small business rate. This change would enable businesses to reinvest and grow, demonstrating that small business ownership in PEI is a solid career choice.
- Pausing increases in labour costs: Implementing a moratorium on further increases to minimum wage and employer-paid benefits. Government should introduce a stable, predictable framework for future minimum wage changes, ensuring wage levels are tied to actual median wages.
- Avoiding introducing any new costs to small business, such as new statutory holidays, fees, policy-driven administrative burdens (red tape), etc.
- Eliminating tolls on the Confederation Bridge: Supporting efforts to push the federal government to remove tolls, aligning with similar federal infrastructure projects like the Champlain Bridge and the Quebec Bridge, which have no tolls. Three-quarters (76%) of PEI small businesses said they want the tolls removed. This would also stimulate a broader discussion on transportation to and from the island, including ferries in the eastern portion of the island.
"By addressing these issues, the provincial government can make progress towards the success and sustainability of small businesses in PEI," concluded Gionet.
For media enquiries or interviews, please contact:
Frederic Gionet
Senior Policy Analyst, PEI / Atlantic
506-866-5548
frederic.gionet@cfib.ca
About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 97,000 members across every industry and region, including over 900 in PEI and 10,200 in Atlantic Canada. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.
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