Provincial budgets always contain lots of little details that have the potential to have big impacts on small businesses. For this reason, CFIB always makes sure to tell policymakers and politicians exactly what we want to see in their annual budgets (and sometimes what we don't!) to help small businesses thrive.
- Age-test public services and programs to make sure the long-term spending implications are understood and then publicly report findings so that taxpayers are aware of the extent of challenges. To date, governments have been slow to prepare for the realities that come along with an aging population.
- Continue to focus on spending restraint. Strong revenues are often a temptation for governments to spend money but that spending is hard to roll back when revenues are weak. For the sake of sustainability, it is important to ensure that debt is contained and that overall spending is sustainable over the long-term.
- Look to increased regional cooperation as a means of finding spending efficiencies. This already happens in a number of areas like health care specialities and joint procurement initiatives but there is definitely more room for us to work together to keep costs down.
- Focus on labour force and economic growth to help offset the impacts of an aging population. Immigration and improved participation are part of the solution but we should also focus on productivity improvements and better matching of training and immigration programs to the labour needs of small businesses.
- Reduce the small business corporate income tax rate to the Atlantic Canadian average of 3 percent over two years. PEI used to brag about it's low small business corporate tax rate but thanks to a hike in 2013, the Island is currently home to the highest rate in Atlantic Canada and the second highest rate in all of Canada.
- Introduce automatic indexation of personal income tax brackets and deductions to inflation and end the decades-long practice of bracket creep. It's only fair that the value of tax brackets and deductions aren't eroded every year because of inflation.
- Work with industries to ensure competitiveness and economic growth are not sacrificed with the introduction of a carbon pricing. Offsetting measures will be important for many businesses, particularly given that they are also facing cost pressures from CPP and EI increases.
- Launch a full-scale tax review with the aim of identifying the most competitive tax system for the province. With the federal mandate to implement a carbon price and a balanced budget, there is no better time to take a thorough look at our tax system and aim to create an environment where businesses and individuals can thrive.
- Introduce a broad-based measure to evaluate the current regulatory burden on the Island and ensure that regulatory reduction efforts are contributing to an overall reduction for Island businesses. Like taxes, it's rarely that one particular regulation on its own is problematic for business owners but rather the cumulative burden of all the regulations, paperwork, bureaucratic language, etc. Having a broad-based measure helps government to understand the full scope of the impact it has on businesses and take steps to minimize it.
- Explore launching a Business Navigator service in PEI based on the Nova Scotia model. Such a model helps alleviate red tape for new and existing business owners but helping them get the information they need to run their businesses.
To learn more, read our submission to the PEI government's pre-budget consultations.