Small businesses ‘unfairly punished’ by upcoming carbon tax hike: CFIB

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Many small business owners are not looking forward to the upcoming carbon tax hike next week.

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According to the Canadian Federation of Independent Business, 56% of small businesses will be forced to raise prices to accommodate the increase while 45% report they will need to freeze or reduce wages. One third say it will reduce their ability to invest in environmental initiatives.

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The federal carbon tax jumps by 23% to $80 per tonne on April 1.

“The giant hike in carbon taxes further highlights how unfair this tax is for small businesses,” CFIB president Dan Kelly said in a statement.

He is calling on the federal government to freeze the upcoming hike.

“The whole carbon tax system has become a shell game, and sadly, small firms are unfairly punished by it,” he said.

Kelly said the Liberal government has not kept its promise to return some revenues from the carbon tax to small businesses.

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“Ottawa is sitting on $2.5 billion in carbon tax rebates intended for small firms, calling into question the government’s claim that the tax is revenue neutral,” Kelly said.

According to CFIB estimates, businesses in Ontario, Manitoba, Saskatchewan and Alberta — provinces under the federal carbon tax system — that qualify for a rebate could receive a one-time payment between $2,600 and nearly $7,000.

In the four Atlantic provinces that came under the federal carbon tax last July, rebates would be between $630 and $1,060.

British Columbia, Quebec and Northwest Territories have their own carbon tax for all sources of emissions.

Kelly said he was happy to hear Deputy Prime Minister Chrystia Freeland’s comments to a recent committee meeting that small businesses will soon have some good news on the billions owed to them since 2019.

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“This can’t come soon enough,” Kelly added.

The CFIB is calling on Ottawa to drop the planned carbon tax hike and immediately return the billions owed to all small businesses.

“Ottawa has an opportunity to right the wrong and announce concrete plans to return the promised $2.5 billion to all small businesses, not just certain sectors,” said Jasmin Guenette, CFIB’s vice-president of national affairs.

“We hope the government listens to small business concerns and will announce details of a plan to keep its promise in the upcoming budget.”

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