Finance Minister Bill Morneau will announce today that the government is cutting the small business tax rate from 10.5 per cent to nine per cent, as promised in the last federal election campaign.
Any tax relief is always welcome, but if the government thinks that the reduction will quell the anger over their proposed tax reform package, they’re sadly mistaken.
There’s an interesting political dynamic at play here; many public opinion polls show that most Canadians don’t have a big problem with the tax reforms, but then again, most Canadians don’t operate small businesses.
But if those tax changes result in some small businesses shutting down or reducing staff or raising prices, you can bet that Canadian consumers will be shaken from their ambivalence on the issue.
It’s highly unlikely that the government will drop the idea of tax reform, but they could modify their approach to the issue.
If there are people who are abusing the existing and quite legal tax reduction tools, go after the abusers, don’t punish everyone.
Backbench MPs from all over the country have been relaying messages of deep concern from small business over the last few months.
So we know that the government has heard the voice of small business in Canada, now we’ll find out if they were listening.
Bill Kelly is the host of Bill Kelly Show on AM 900 CHML and a commentator for Global News.