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Kelowna Chamber of Commerce president Tom Dyas, left, and Finance Minister Bill Morneau.
The Kelowna Chamber of Commerce is applauding Justin Trudeau’s revived plans to lower taxes on small businesses, but says the announcement won’t change its opposition to the federal government’s proposed corporate tax changes.
The government announced the small business tax reduction today, promising to gradually scale back small business taxes, from 10.5 to 9 per cent, by the end of 2019.
The promise came at the same time Trudeau announced the federal government will abandon changes to capital gains rules it outlined in its recently announced proposed corporate tax changes, as well as simplify its proposed income sprinkling changes.
Many saw today’s announcement as the government’s attempt to placate business owners, many of whom have railed against the changes since they were first proposed.
Chamber president Tom Dyas told Okanagan Edge today the changes signal the government is willing to listen to its critics.
However, he said chambers of commerce across the country will work diligently to ensure the tax reduction doesn’t push aside the business community’s concerns about the remainder of the government’s tax proposals.
“The new measures [the government] proposed today, while they’re not perfect yet… it shows that they did listen, and they are a little bit more balanced,” Dyas said. “But the idea that they came out today and announced there was a decrease in the small business tax, as opposed to specifically just addressing all of the individual issues that were raised through the consultation period… isn’t exactly what we wanted.”
Dyas said he is frustrated that specific details about the proposed corporate tax changes remain vague, and continued his call for more consultation.
“Any time you’re lowering a corporate tax rate it’s great, but that’s fairly clear, people understand that. With the other [proposed changes] they’re telling us exactly what they’d like to do, but they’re not giving us the rules,” he said.
Ideally, he said, the government would put together a commission to study the potential impacts of its proposals at length, before any decisions are made.
“These are major, major tax changes they have instigated,” Dyas says. “They can’t just add something new to the mix” and hope everything goes OK.
The government said today its reduced small business tax could save entrepreneurs as much as $7,500 a year.
Dyas said the savings won’t add up to “a huge amount,” and that the couple thousand dollars business owners will save won’t compare to the “punishment that will be implemented on businesses” under the remaining proposed rule changes.
The government is expected to announce more changes to its corporate tax proposals Wednesday. The Kelowna Chamber of Commerce, and many others in the business community, will be watching closely.
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