The ORPP is (almost) dead, CPP rate hike is now upon us
Ottawa and the provinces have agreed, in principle, to expand the Canada Pension Plan (CPP) with higher premiums beginning in January 2019, and phased in gradually through 2025. This will certainly mean higher payroll taxes for small businesses and their employees, but the one piece of good news is that the proposed Ontario Retirement Pension Plan (ORPP) is now almost dead.
CFIB has fought hard from the beginning to strongly oppose the implementation of the ORPP. Most recently, we delivered 40,426 petitions from business owners and 6,600 signatures from their employees to the Minister of Finance, urging him to axe this new pension tax.
With the CPP expansion deal in place, Premier Kathleen Wynne announced that she will begin winding down the ORPP bureaucracy. The ORPP would have hit small business owners with an additional 1.9% payroll tax on income up to $90,000, phased in over 3 years. The CPP proposal is for about one percentage point increase of the current rate (4.95%) on income up to $83,000, phased in over 7 years.
The CPP deal needs to be ratified by July 15, for ORPP to be fully scrapped. Even after that, CFIB will continue to voice our members’ concerns about the significant impact the CPP expansion will have on their business and their employees. Follow our lobbying work as this fight is far from over.