Small Business Tax Breaks: Government Fall Agenda Highlights

Government Fall Agenda HighlightsAs the government returns from its break (read: summer holidays), the Conservative’s Fall Agenda will be shaped by an omnibus bill bringing small business tax breaks to the table.

“Canadians expect their government to focus on maintaining Canada’s record of relative strength and to build on our record for hardworking families,” Peter Van Loan, House of Commons Leader, told reporters at a news conference that preceded a Conservative caucus meeting.

The legislation is expected to include a small business hiring tax credit to make it easier for small businesses to create jobs, as well as efforts to increase exports and the development of more free trade agreements. Van Loan also hinted that the bill, which is to be tabled next week, would include reform to the current MP pension plan as well as adjustment to crime legislation.

The bill will look to buffer the governments’ plans of targeted spending, ahead of the Federal Budget due out in March.

But what impact does less government spending have on the economy?

What’s The Economic Tradeoff?

If you ask the economists on Bay Street, you’re likely to hear that reduced spending by the government can have adverse effects on the economy. However, the Conservative government’s plan to include a small business hiring tax credit are intended to have a positive effect on our nation’s economic standing. On the surface, most the Conservative’s economy-related policies point to creating more jobs through legislation geared towards pushing certain pressure points in the Canadian economy.

As nearly half of the Canadian workforce is employed in jobs at small businesses, stimulation in this sector and tax credits will put a focus on creating more employment, which leads to increased consumer spending down the road.

Picking Up Where Last Year’s Budget Left Off

“Our budget was a comprehensive plan for jobs and growth by harnessing our natural resources, by taking advantage of our human resource, by ensuring that we keep taxes low, by balancing the budget,” added Van Loan in a press conference. “All these pieces go together in a comprehensive plan for short and long-term prosperity and it’s natural that a budget implementation bill would implement the elements of the budget.”

Changes to the MP Pension Plan

Ultimately, with such a wide range of needs from Canadians, the tax credits the government is tabling will likely not benefit everyone – but there is one change that may interest all Canadians: adjustments to the cushy MP pension plan.

According to numbers released last June by the Canadian Taxpayers’ Federation, the public contributes more than $24 for every $1 MPs contribute to the pension plan. The fall omnibus bill by Harper’s government will ask for higher contributions by MPs and increase the age of eligibility – and that could result in more money in your pocket.

 

 

 

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