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Independent business association urges governments to tackle cost issues

Tuesday, July 12, 2022 @ 4:09 PM | By Elizabeth Raymer


As Canada's premiers gather at the 2022 Council of Federation meeting in Victoria, B.C., on July 11-12, the Canadian Federation of Independent Business (CFIB) is calling on premiers and the federal government to address affordability problems that are hindering small businesses.

“Transportation and fuel costs have driven 92% of small businesses to increase their prices in the past 12 months, according to recent data from the Canadian Federation of Independent Business,” the CFIB has said in a statement.

“Record-high prices at the pump, coupled with ongoing supply chain challenges and labour shortages, have pushed the cost of doing business through the roof, adding immense pressure on small business owners and consumers across the country.”

The association is asking premiers and the feds to:
  • temporarily eliminate or lower federal and provincial fuel excise taxes;
  • pause planned hikes to carbon taxes;
  • raise the federal and provincial small business deduction threshold to $600,000 (currently $500,000) to match Saskatchewan, and indexing the threshold to inflation annually.

Small businesses are also facing “skyrocketing input costs and labour and product shortages,” the CFIB said. Noting that three provinces — Ontario, Alberta, and Newfoundland and Labrador — “have provided temporary relief at the pumps,” the association urged federal and other provincial governments to follow suit.

“More than half of small businesses nationwide have yet to return to normal revenue levels,” said the CFIB’s senior vice-president of national affairs Corinne Pohlmann in the news release. “As the premiers come together … they need to make small business recovery a top priority.” 

Seventy-seven per cent of businesses reported they were struggling with fuel and energy costs, according to CFIB data, and “skilled labour and input product shortages are also important cost constraints for 50% and 30% of businesses respectively,” the association said in the statement.

The cost of internal trade barriers

The CFIB also cited internal trade barriers as being costly to the Canadian economy.

“Five years into the Canadian Free Trade Agreement, the progress on reducing unnecessary barriers to the movement of goods, services, labour, and investment has been slow,” the association said, urging Canadian governments to reduce “red tape and trade barriers.”

To that end, the association recommended that governments:
  • adopt a policy of “mutual recognition” to internal trade, meaning that a regulatory standard in one jurisdiction is recognized in all other jurisdictions without meeting further requirements; and,
  • provide better and more transparent data on progress, particularly on implementation of reconciliation agreements.

Methodology

The CFIB’s findings were based on 700 responses it received in a controlled-access web survey from a random sample of CFIB members, and published in its June Business Barometer. The findings were also based on a Small Business Recovery Dashboard survey in mid-June, and another survey ending later that month, based on samplings of 2,353 and 2,533 CFIB members, respectively.

If you have any information, story ideas or news tips for The Lawyer’s Daily on business-related law and litigation, including class actions, please contact Elizabeth Raymer at elizabeth.raymer@lexisnexis.ca or 905-415-5888.