The federal government needs to be more forthcoming about the details of proposed small business tax changes, according to the Conservative Party’s small business critic.
Dan Albas, member of Parliament for Central Okanagan — Similkameen — Nicola, will be holding an event with the Penticton and Wine Country Chamber of Commerce next Wednesday to garner some input from local businesses on issues like proposed small business taxes and changes to mortgage rules from the Canadian Mortgage and Housing Corporation.
Albas has been touring Canada since October since he stepped into the small business critic role making stops across B.C., up into the Northwest Territories and as far east as the Maritimes.
“Largely what I hear from small business owners is they want to do good things in the economy, it’s just they feel attacked by many different levels of government, including the federal,” Albas said.
“Increased regulations, increased payroll taxes, some provinces are wrestling with large increases in minimum wage, and those are just real challenges that some business models are going to have to deal with.”
The issue of small business tax changes is still a major one for special interest groups, and Albas said the government has been aloof about the nitty gritty of the changes.
“There’s still a lot of uncertainty as to where the minister of finance will go on the small business tax changes,” Albas said. “The passive investments are still a big area of concern for both the Canadian Chamber (of Commerce) as well as the Canadian Federation of Independent business.”
Passive investments, one of three loopholes the federal government is taking aim at, refer to small businesses holding excess income in business accounts and growing that account through interest rates at a lower tax rate than if the money were held in a personal account.
That would mean the income from the interest rates would grow faster in the business account, which the federal government calls an unfair advantage for business owners over the rest of the population.
“The big thing for me is I’ve been given a platform by our new leader Andrew Scheer,” Albas said. “He wants to know not only how can we best hold the Ottawa Liberals to account in Ottawa, but what things practically can Conservatives offer in the next election that will help build a positive environment so that small family businesses can flourish and become larger and employ people.”
Albas also noted tightening of mortgage rules from the CMHC that kicked in on Jan. 1. The rules are intended to protect agencies like the CMHC and major lenders from people taking out loans they are unable to pay back, but Albas believes a finance committee study put that issue to rest.
“When you find out that the foreclosure rates on mortgages in Canada is less than a third of a per cent, and even in places that are economically stressed like Alberta, they only saw it rise slightly, and it’s still far less than a per cent, then you would ask should the government be tamping down demand when supply is clearly a big issue,” Albas said.
“So I’ll be listening to small business owners and find out what kind of impacts — I’m just saying that that industry is going to be impacted yet again, and I want to hear from them because it’s no longer going to be theoretical. We’ll start hearing what the response has been from the industry itself.”
Albas will be speaking to the chamber of commerce on Jan. 17 at 6:30 p.m.