CHARLOTTETOWN, PEI February 21, 2025 — With potential US tariffs threatening to destabilize Prince Edward Island’s economy, local small businesses are urging the provincial government to adopt critical reforms without delay. With 51% of small businesses directly trading with the US, the impact of these tariffs could be severe, affecting jobs and economic stability across the province.
As the Legislature reconvenes on February 25 and a new budget is expected soon after, entrepreneurs stress that decisive action is needed to safeguard jobs and sustain growth in the face of external economic pressures.
Central to CFIB’s requests are a freeze on the Small Business Tax Rate at 1%, an increase in the small business deduction threshold from $500,000 to $700,000 (+indexed to inflation), and decisive efforts to remove interprovincial trade barriers. They also call for toll-free access to the Confederation Bridge and ferries—citing it as an unfair cost disadvantage—and a streamlined province-wide strategy to cut red tape.
In addition, CFIB recommends a standardized approach to mitigating disruptions caused by major construction projects, along with predictable labour costs by tying minimum wage increases to PEI’s median wage. They further emphasize the importance of transparent, affordable energy policies, including multi-year rate projections to help businesses plan effectively.
“Even before looming tariffs, PEI’s small businesses were operating under outdated thresholds and high operating costs,” said Frederic Gionet, Director of Legislative Affairs, Atlantic / PEI. “Now, the stakes are even higher. By modernizing our tax system, removing interprovincial trade barriers, and stabilizing day-to-day expenses, government can mitigate the impact of tariffs and secure the Island’s economic future.”
Recommendations are further detailed in the accompanying document: Competitive PEI, Stronger Businesses: 2025 Top PEI Small Business Priorities.
Frederic Gionet, CFIB
506-866-5548
frederic.gionet@cfib.ca
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 100,000 members across every industry and region, with 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.