Small business investment - A call for action
A new report from the Canadian Federation of Independent Business (CFIB) reveals that 32% of Canadian small businesses expect their capital investments to decrease over the next two years. Many farmers would agree.
Alarmingly, only 40% are making investments aimed at boosting their productivity.
CFIB’s findings show that over two-thirds (69%) of businesses are deterred by high equipment costs, with 56% citing the overall high cost of doing business and 50% mentioning cash flow constraints as additional barriers. In certain provinces, such as British Columbia, Saskatchewan, and Manitoba, nearly 40% of businesses report that the inability to write off Provincial Sales Taxes limits their investment potential.
To address these challenges, CFIB urges the federal government to make the Accelerated Investment Incentive and Immediate Expensing measures permanent, allowing faster write-offs. Additionally, it calls for the abandonment of the capital gains inclusion rate increase to 66.7%.
CFIB also recommends that governments reduce corporate income tax rates to allow businesses to reinvest more of their income, prioritize faster permitting and assessments for large infrastructure projects, especially in sectors like energy, and create policies that encourage investment. By supporting small businesses with the right tools, Canada can boost productivity and strengthen the economy.