Quebec’s minimum-wage hike will hurt businesses, CFIB warns

CFIB says 79 per cent of its membership feel the best way to let them weather the latest minimum wage increase is to reduce their tax burden.

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The Canadian Federation of Independent Business (CFIB) said Friday that the 5.56-per-cent increase in Quebec’s minimum wage, which goes into effect Sunday, will have a negative impact on more than half of its members.

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The CFIB calculates that the increased hourly wage of $14.25 will represent an additional $237.1 million in costs for businesses already dealing with hikes in operating expenses.

François Vincent, Quebec vice-president for the CFIB, added that the past two years of COVID-19 pandemic restrictions had created an average debt load of $108,000 for small and medium-size businesses in Quebec as well as a drop in revenues for most of them.

A consultation by the CFIB found that 79 per cent of its membership felt the best way to let them weather the latest minimum wage increase is to reduce their tax burden, while 73 per cent called for a reduction in payroll taxes. Tax credits were favored by 58 per cent.

The CFIB found that a reduced tax burden would allow 70 per cent of the membership to increase salary levels.

The group says there are alternatives to fight poverty. The CFIB argues that tax credits and bonuses targeting low-wage employees would not put additional pressure on businesses already in a fragile state.

The CFIB says it has 95,000 members in all sectors of business activity.