The ORPP is dead; CPP rate hike is next
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. British Columbia has stalled a final agreement by joining Quebec as the only two provinces opting to hold public consultations before signing.
Any deal reached will 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 dead.
CFIB fought hard from the beginning to strongly oppose the implementation of the ORPP. We delivered 40,426 petitions from business owners and 6,600 signatures from their employees to the Minister of Finance, urging him to axe the pension tax.
On July 28, 2016, Premier Kathleen Wynne announced that the government would wind down the ORPP bureaucracy, a process that has already been concluded.
The ORPP would have hit small business owners with an additional 1.9% payroll tax on income up to $90,000, phased in over three years. The CPP proposal calls for about a one percentage point increase of the current rate (4.95%) on income up to $83,000, phased in over seven years.
CFIB will continue to voice our members’ concerns about the significant impact of CPP expansion on their businesses and employees. Follow our CPP advocacy efforts; this fight is far from over.