Winnipeg, September 25, 2025 – The Canadian Federation of Independent Business (CFIB) welcomes today’s announcement that the Manitoba government will convert the Manufacturing Investment Tax Credit (MITC) for machinery and equipment into a retail sales tax (RST) exemption. This is a positive step to cut red tape and support small business investment.
CFIB survey data shows only 20% of Manitoba small businesses expect to increase their investments in the next two years, while 35% expect to decrease them. Business investment in machinery and equipment per worker has declined 16% nationally over the last decade, and in Manitoba the drop has been even sharper at 27%, or $2,200 less per worker. Without strong action, this problem will only worsen.
“We’re pleased to see the Manitoba government recognize the urgent need to boost productivity at a time when investment decisions are being delayed by economic uncertainty. CFIB has been calling for the removal of the RST on all capital expenditures (including M&E) since last fall, and this change to the MITC is a welcome step forward, but it does not fully address the issue,” said Brianna Solberg, CFIB Director for the Prairies and Northern Canada.
“This change still leaves many small businesses, especially in construction, agriculture, and wholesale sectors, paying RST on critical productivity-boosting tools like tractors, power drills, and computers. Manitoba remains one of only three provinces that still applies sales tax on capital purchases, alongside Saskatchewan and B.C.,” added Solberg.
A recent CFIB report found that fully exempting all capital purchases from RST could increase investment by ~18%, injecting nearly $332 million into Manitoba’s economy. That means more jobs, higher wages, lower prices, and better access to the goods and services Manitobans rely on.
“Small businesses will appreciate measures like the new workforce training initiatives included in Manitoba's new Economic Development Strategy, and efforts to better align education with labour market needs, all of which are critical to growing a stronger economy,” said Tyler Slobogian, CFIB Senior Policy Analyst for the Prairies and Northern Canada. “But at a time when small businesses face high costs, labour shortages, and the threat of U.S. tariffs, CFIB urges the Manitoba government to build on today’s announcement and go further to strengthen Manitoba’s economy,” concluded Slobogian.
For media enquiries or interviews, please contact:
Dariya Baiguzhiyeva, CFIB
647-464-2814
public.affairs@cfib.ca
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