Jim Flaherty Understands The Value Of Small Business

Small businesses in Canada are standing their ground to what we perceived to be a slow but steady infringement of government regulations on business. Most bills that come to life have little positive impact on businesses and are designed more to "protect" employees.

The cold, hard truth is employees not just in Canada but across North America are very well protected and insulated through our advanced social safety net. Everything else is just gravy - which, I contend, needlessly adds to labour cost with little benefit.

Our stance is largely helped by the Canadian Federation of Independent Business and the Canadian Taxpayers Federation (two organizations I belong to). They've both been in the news quite a bit thanks to their lobbying efforts. Armed with facts that back up our reality, the groups have been able to convey our concerns (and make inroads) to both Federal and Provincial officials across the country. Thankfully, Finance Minister Jim Flaherty has been receptive to our concerns and proposals. It certainly is less stressful knowing someone is listening.

For example, capital taxes have been eliminated, lowering red tape and a freeze on payroll deductions. Those are huge victories.

In Quebec in particular, the biggest laggard economy thanks to its antiquated visions on business, there were major breakthroughs. It was revealed Quebec's CSST ran a surplus in its budget. Money that belongs to taxpayers and the CFIB lobbied they give it back in the form of lower premiums. For now, they are modest reductions but pressure will mount to ensure a publicly funded department doesn't carry a surplus given it is not a "for-profit" enterprise. They were wanting their cake and eating too by continuing to increase premiums (which were very expensive with very loose and broad definitions of what constituted 'hazardous jobs') and running a surplus. If businesses (often unjustifiably) are criticized for not giving back some of its profits to employees why should it be any different with a public sector department?

Like our brethren in the USA, disability insurance and their departments are vulnerable to fraud and corruption. It is up to us to be vigilant and watch over them.

Another area that always left me perplexed was the issue of employers not being able to pay into Canada and Quebec pension plans. Apparently, self-employed individuals (who provide jobs and pay taxes) were not workers. It was an outrageous injustice but that has changed too. The mentality that business owners are "rich" needs to be confronted at every turn.

I am also pleased payroll and health taxes have been reduced. I pay about $3000 a month on payroll taxes. Does anyone think about the consequences of that? With $3000 I can hire a worker or two or even pay down business debt faster. Pay down debt faster, you save on interest, when you save money, you have more in the business bank account, when there's more in the business account you have leeway to increase expenditures or for expansion all of which benefits the business, employee and ultimately the government in the form of corporate taxes. Instead, it suffocates or slows down our pace of growth.

I've read (mostly on left-wing sites) "business owners" claim increasing labour and social costs is good for their business. Which makes me wonder if they're businessmen because no one in their right mind would advocate for the government to extend unemployment insurance or increase minimum wages thinking it would improve sales. That's just nonsense.

In the short-run you may experience higher sales but in the long-run it will hamper the economy.

The CFIB also brought to the attention their concerns about Bill 14. Another piece of productive legislation dreamed up by our provincial masters. There was absolutely no reason to ruffle the feathers of business for language as well as looking to liberate our restrictive liquor permit laws and the disproportionate power unions hold in the construction industry.

The latter is especially important. Unions, led by outfits like the FTQ, have become parasites on our economy. For the past couple of years their pensions have been under performing thanks to massive incompetence and corruption (it was recently revealed some of their funds included investments in businesses owned by the Hell's Angels including strip joints. Yes, nothing screams secure investment like a stripper dancing around a poll with reputable drug lords at the helm. That's how deep the stupidity. Yet, with the inevitable deficits that result that come groveling back to the government demanding they tax the rest of us to make up for the shortfall to the tune of increases of up to 60%! In other words, while they engage in specious behavior they expect us to bail them out.

Thankfully, at both levels of government, they have been shot down but they keep coming back.

In addition, the government was mulling over forcing companies to over group savings plans to their employees but with a catch. We would have no choice in who our provider would be. In this case, the government (surprise) chose Caisse Desjardins. Possibly the least desirable of all banks to do business with. My interactions with them hasn't been positive - at all.

Amazing the government would compel us to do such a thing. If I would not voluntarily not opt for them why should I be forced to? Like I said, I have no confidence in them.

Also, the CFIB have taken the charge in the patently unfair landscape of subsidized daycare in Quebec. The argument made here is why should the government open up 15 000 spots with its enormous cash outlay for CPE's when there are 10 000 free spots available in the private sector. If affordable care is so important, then why not simply offer a subsidy to those private business without one and are not for some inexplicable reason eligible to apply for one? Problem solved.

In my view, subsidized daycare is a racket and is very expensive for the province to administer. But if this is what they want, the CFIB's stance is perfectly acceptable if not financially logical.

Why does all this matter?

For starters, the CFIB represents 109 000 members. I'm not sure about the CTF (I believe it's around 65 000).

For Quebec, it's especially crucial to its economic survival. Consider that small businesses make up 87% of our economy.

That means Quebec is an entrepreneurial economy. We should be encouraging this; not hold it back.

It has been a productive year for Canadian small business and this is good for all of us. It helps that Finance Minister Jim Flaherty understands our concerns. He has been extremely attentive and proactive with what has been presented before him.

One can only hope 2014 continues to progress forward.