I would like welcome you and the Liberal caucus to Kelowna.
I trust your caucus retreat will be constructive and I hope you have some time to visit some of our nearby amenities and attractions.
I also hope you will have the opportunity to meet with local small business owners and I will explain why.
During my time in office as a Member of Parliament, I have not encountered any single issue that has more angered small business owners than the current tax proposals you are contemplating.
I believe it is important you understand why this anger exists.
You might recall during the last election, your Liberal platform promised to, and I quote directly; “reduce the small business tax rate to 9 per cent from 11 per cent”.
Flash forward to today and not only have you reneged on this promise but many small business owners feel that you have labelled them as tax cheats.
Your government is implying that the amount of tax they pay is unfair and paying more tax to Ottawa will create fairness for those who are not self-employed.
Many small business owners find this offensive from a government who promised something very different during election time.
Throughout this discussion I have repeatedly heard your Finance Minister talk about “misinformation” as if to imply that somehow small business owners do not understand what paying more in taxes really means.
This also offends many small business owners.
On the topic of misinformation, it is also very important to explain that when a small business owner pays themselves a wage, they do so at the exact same income tax rates that any other Canadian citizen does.
That is an important distinction.
In essence, the small business owner pays taxes twice.
The first time is when the small business owner pays tax on any profit, assuming there is some. All small businesses pay lower taxes on business income than personal income taxes. However don’t overlook that all net income, once paid out in wages, is taxed again at the same personal income rates as all other Canadians.
It is also important to keep in mind that a small business owner has no Employment Insurance, no Canada Pension Plan, no taxpayer financed public sector pension or related benefits, no maternity leave benefits and no formal vacation pay system.
All of these expenses must be covered by the small business profits, again assuming there are some.
I mention all of these things to hopefully better illustrate why so many small business owners are taking such strong opposition to your proposed changes.
As I believe it is important to propose and not just oppose, I would like to offer a few observations.
Canadians understand we must live within our means.
Likewise, Canadians also understand your government is running significantly larger deficits than promised and currently has no plan to return to the promised 2019 date for balanced budgets.
Canadians further understand either spending has to be reduced or taxes increased to pay for all of your spending.
Your government has clearly decided increasing taxes is the solution. Rather than demonize small business owners under the guise of tax fairness, why not at least admit that your Liberal proposal is a tax increase? Recognize that small business owners are being asked to pay for this heavy burden.
Mr. Prime Minister, you often talk of recognition and respect and in my view it is time for you to show some for Canada’s small business owners.
Here’s my question for Canadians: What are your thoughts on raising small business taxes?
I can be reached at firstname.lastname@example.org or by calling 1-800-665-8711.
Dan Albas is the Member of Parliament for Central Okanagan-Similkameen-Nicola, and the shadow minister for small business.