Victoria, February 17, 2026 – Budget 2026 misses the opportunity reverse B.C.’s entrepreneurial drought and make the province the best place in Canada to start and grow a business, says the Canadian Federation of Independent Business (CFIB). Instead, the province is reporting deteriorating finances, multiple new tax increases, and a new record-setting deficit of $13.3 billion.
“This budget’s tax increases make B.C. a less competitive place to do business. Our province is losing out on new business formation, which threatens long-term growth, government revenues, and the ability to balance the budget,” said Ryan Mitton, CFIB’s Director of Legislative Affairs for B.C. “When fewer people start businesses, fewer jobs get created, less investment flows into communities, and the tax base shrinks. B.C. cannot grow its way out of a deficit if it is not growing its entrepreneurs.”
Small business owners have consistently pointed to three areas where they want action from government: keeping public finances under control (93%), easing the tax burden (91%), and reducing unnecessary rules and paperwork (80%). But instead of easing the tax burden, Budget 2026:
- Increases the bottom personal income tax rate from 5.06% to 5.60%.
- Pauses indexation of income tax brackets through 2031, resulting in tax bracket creep through inflation.
- Expands PST to professional services including accounting and bookkeeping, architects, engineering & geoscience, rental property & strata management, commercial real estate commissions, and security & private investigation services.
“Small businesses are telling us it is simply too costly to grow right now, and new taxes—like adding PST to professional services—do not help.” added Kalith Nanayakkara, Senior Policy Analyst at CFIB. “By growing the economy from the grassroots, the government can increase provincial revenues and get back to a sustainable fiscal position. Today’s plan does not get us there.”
Federal data shows B.C.’s business creation has weakened. The province has experienced more business exits than entries over the past five consecutive quarters. Confidence remains weak. CFIB data shows only 13% of B.C. business owners say the provincial government supports them, while 63 percent would not recommend starting a business today. This means fewer homegrown entrepreneurs who hire, innovate, and invest in local communities.
“We are calling on all elected officials to fix B.C.’s entrepreneurial drought,” concluded Ryan Mitton, CFIB’s Director of Legislative Affairs for B.C. “Nearly two-thirds of B.C. business owners tell us they would not recommend starting a business today. However, the government can still show entrepreneurs that they have their back, instead of punishing those who take risks to grow our economy.”
A silver lining in Budget 2026 is the new Manufacturing and Processing Investment Tax credit, which will provide a 15% refundable tax credit to businesses investing in buildings, machinery, and equipment used in manufacturing and processing.
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For media enquiries or interviews, please contact:
Kalith Nanayakkara, CFIB Senior Policy Analyst for British Columbia
Kalith.nanayakkara@cfib.ca
About CFIB
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. 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.
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