Tax talk puts ‘chill’ on Sask small biz confidence

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78 per cent oppose increasing education taxes to fund infrastructure

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The Canadian Federation of Independent Business (CFIB) is raising its serious concerns with Premier Wall’s comments made at the Saskatchewan Urban Municipalities Association (SUMA) convention regarding the potential of raising education property taxes in the upcoming provincial budget to help pay for infrastructure projects.

”We are very concerned the provincial government is considering dedicating a revenue stream – potentially education property taxes – to infrastructure projects,” said Marilyn Braun-Pollon, CFIB’s Vice-President, Prairie & Agri-business.

“While we understand the Government of Saskatchewan is facing increasing demands to fix roads, bridges, sewer and water facilities, our small business members do not support an increase in education taxes to fund infrastructure,” added Braun-Pollon.

A recent CFIB survey found 78 per cent of Saskatchewan small business owners are opposed to the Government of Saskatchewan introducing a province wide property tax levy on business and residential properties to fund infrastructure. Saskatchewan small business owners are concerned this would increase the overall tax burden on businesses and residents. A tax increase is unnecessary as government should instead use existing funds more efficiently and effectively. Only 10 per cent of respondents support a property tax levy to fund infrastructure.

Last week, CFIB released the Saskatchewan January 2014 Monthly Business Barometer®, which revealed optimism among small business owners in Saskatchewan fell to an index of 63.7 in January from 68.4 in December. This two month decline puts optimism at the lowest level in three years and moves Saskatchewan below the national index of 64.0.

“With optimism levels falling back markedly in January, it is evident recent municipal property tax hikes and threats of future tax hikes are taking a toll on small business optimism. We believe the last thing the provincial government should be considering are policies, like tax hikes, which will further erode Saskatchewan’s competitive edge and level of optimism,” stated Braun-Pollon.

Lower Canadian dollar good news for provincial treasury

“We understand that every penny the dollar drops throughout the year means more than $30 million in revenue for the provincial treasury. With the current value of the Canadian dollar at $0.90 US and the forecast for a weaker Canadian dollar into the foreseeable future, we question the need for hiking taxes,” noted Braun-Pollon.

The Saskatchewan Plan for Growth clearly states it will continue working on key activities to support an agenda for growth. CFIB questions how a tax hike accomplishes the province’s competitiveness goal.

“We realize the budget is being finalized in the coming days and therefore urge the provincial government to live within its means, ensure sustainable spending and reject raising education property taxes to pay for infrastructure projects,” concluded Braun-Pollon. “We hope the government is listening.”

Organizations: Canadian Federation of Independent Business

Geographic location: Saskatchewan

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