Small business tax cut and red tape reduction creating competitive business environment for Ontario
BRAMPTON — The Ontario government is lowering costs and eliminating unnecessary and outdated regulations for small business owners and entrepreneurs so they can invest in their businesses, attract new customers and clients, and transform their vision into a success.
In Ontario, small businesses make up 98 per cent of all businesses and account for a third of all private sector jobs. The government is committed to helping the people of Ontario follow their dreams of starting their own small business.
Today, Rod Phillips, Minister of Finance was joined by Prabmeet Sarkaria, Associate Minister of Small Business and Red Tape Reduction, at Salon 247 in Brampton to talk about how the government’s plan is creating a climate that will support and attract business investment and job creation.
As announced in the 2019 Ontario Economic Outlook and Fiscal Review: A Plan to Build Ontario Together, the government is proposing to reduce the small business Corporate Income Tax rate to 3.2 per cent from 3.5 per cent, starting January 1, 2020. This would provide tax relief of up to $1,500 annually to over 275,000 businesses — from family-owned shops to innovative start-ups, fulfilling the government’s promise to cut small business tax rate by 8.7 per cent. In addition to providing tax relief, the government is providing savings to small businesses by cancelling the cap-and-trade carbon tax, preventing an increase in the minimum wage and supporting WSIB premium reductions. Taken together, these initiatives would save small businesses over $2 billion in 2020.
“Small businesses are the backbone of our economy and that is why the government is creating the conditions for a competitive business environment by delivering on a key campaign commitment to provide tax relief to small businesses,” said Minister Phillips.
The government will also consult with industry and business leaders in the coming months to inform the development and implementation of an Ontario Small Business Success Strategy. The consultations will provide business owners the opportunity to directly tell the government about what matters most to them, and what additional steps the government can take to help their businesses flourish and grow.
Ontario is also removing unnecessary red tape to support small, independently owned businesses by proposing to exempt barbers and hairdressers from keeping a record of the name and contact information of all their customers and having a dedicated space for maintaining tools. While this makes sense for tattoo artists and tanning salons, it is an unnecessary burden for barbers and hairdressers. This exemption would make it easier for them to do business and reduce the need for people to share their personal contact information.
“As the Associate Minister Responsible for Small Business and Red Tape Reduction, I couldn’t be happier for Ontario’s businesses that create jobs and opportunities for hardworking Ontario families,” said Associate Minister Sarkaria. “Our efforts to address red tape will save businesses over $338 million once the Better for People, Smarter for Business Act is passed.”
Quick Facts
- Ontario will create the Premier’s Advisory Council on Competitiveness to work with business leaders and workers across the province to find ways to improve competitiveness and report back with actionable recommendations.
- To date, the government has taken over 100 actions to cut red tape for businesses. These and other expected measures would save businesses $400 million in compliance costs.
- In January 2019, the Canadian Federation of Independent Business gave Ontario an A- in its 2019 Red Tape Report Card. That was Ontario’s highest grade ever, and a big jump from the C+ that the previous government received in 2018.
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