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Small business key to making Canada the innovation nation

Toronto, October 19, 2016 – Canada’s small businesses need to be part of the country’s innovation conversation, according to the latest report from the Canadian Federation of Independent Business (CFIB) being released at the first meeting of the all-party Entrepreneur Caucus since last fall’s election.

“CFIB supports the decision of the federal government to focus on innovation and we hope they will come up with a broad-based policy that is available to small firms and not one that just picks a few sectors or clusters to support,” said Corinne Pohlmann, CFIB’s senior vice-president of national affairs and partnerships. CFIB’s new innovation study found more than eighty per cent of small businesses report that they have been innovative in their business in the past five years. “There are lots of definitions of innovation and many ways to innovate. We want to make sure that public policies will be based on an inclusive approach that takes into account all sorts of activities. We have to keep in mind that big changes in our society were often preceded by small ideas.”

A stronger business environment and broader measures will lead to greater innovation
"Creating an environment that encourages innovation shouldn’t necessarily mean that government has to create costly new financing grants or programs,” said Pohlmann. “Instead, small business owners consider that it could be more effective for governments to address barriers to innovation such as skilled labour shortages, red tape and lower taxes to drive more innovation in Canada.”

“We also recommend approaching new regulations and legislation with an ‘innovation lens’ that will consider the impact of new policies on small employers’ ability to innovate,” added Pohlmann. In addition, reinstating the small business corporate tax reduction plan and easing – instead of increasing – the burden of payroll taxes, are examples of policies that would encourage more innovation in small business.

“The ideal model will help small businesses hire more people, pay higher wages and be even more productive contributors to Canada’s economic growth,” said Pohlmann. “One way for government to do that would be to implement an innovation deduction that would allow businesses to claim up to $100,000 per year on new equipment and technology similar to what was recently introduced in the United States.”

Most small business owners unaware of current government programs
While the government offers several programs and tax credits to support innovation, many small business owners are simply unaware they exist. More than half of business owners surveyed were not very or not at all aware of programs including the Industrial Research Assistance Program (IRAP), and the Networks of Centres of Excellence.

Providing small business owners with better information would be welcomed and CFIB hopes to continue to collaborate with the government to help make Canada’s businesses more innovative.

Read the full report: Beyond the Big Idea: Redefining and rethinking the innovation agenda

To arrange an interview with Corinne Pohlmann, please contact Kiara Morrissey at 416-222-8022, 647-464-2814 or [email protected]


CFIB is Canada’s largest association of small- and medium-sized businesses with 109,000 members across every sector and region.

October 19, 2016

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