Toronto, November 21, 2024 – The Canadian Federation of Independent Business (CFIB) welcomes any tax cutting measure, but adds that narrow, temporary sales tax holidays can add confusion and administrative complexity for small business owners.
The lack of consumer demand is currently the top limitation on sales growth for small firms, cited by 53% of CFIB members. While a temporary sales tax cut will help boost demand in some sectors, like restaurants, in the slow post-holiday period, Canadians and Canadian businesses really need permanent tax relief.
The temporary sales tax holiday will be reasonably straight forward and welcome in some sectors like restaurants and food service businesses but may add confusion and complexity for general retailers with both taxable and new exempt items. It will require retailers to reprogram point of sale systems twice in a two-month window. In addition, some small manufacturers and retailers will undoubtedly question why they are excluded from the exemption. It is hard to explain to a small producer of spirits why their products are taxed while other alcoholic beverages are not.
It is good news that government and political parties are shifting their focus on reducing taxes rather than just increasing them. But Canadians need permanent, not temporary tax relief. Reducing the small business corporate tax rate or payroll taxes like Employment Insurance and CPP premiums are among the top priorities for small business owners.
CFIB also notes that six weeks after the sales tax holiday ends in mid-February, government plans to hike the carbon tax by 19% on April 1 while cutting the carbon rebate to small firms by nearly half. Freezing, then scrapping the carbon tax, is an even bigger priority – supported by 83% of small business owners.
- Dan Kelly, President, CFIB
For media enquiries or interviews, please contact:
Dariya Baiguzhiyeva, CFIB
647-464-2814
public.affairs@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. 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.