Challenges and Opportunities for
Small Business in Nova Scotia
Pre-Budget Meeting with the Honourable Diana
Whalen, Minister of Finance
February 12, 2014
Corinne Pohlmann, Senior Vice President, National Affairs
Jennifer English, Senior Policy Analyst, Nova Scotia
www.cfib.ca
About CFIB
Mandate: Big voice for small business
Promote and protect Canada’s freeenterprise economy
Result of tax protest over 43 years ago
109,000 members with over 5,200 in
Nova Scotia
Non-partisan; 100% member funded
One member, one vote policy
www.cfib.ca
State of Nova Scotia’s Economy
CFIB January Business Barometer
Index (0-100)
85
80
75
70
Canada
64.0
Newfoundland &
Labrador
68.1
Prince Edward
Island
58.8
65
64.0
Nova Scotia
58.1
60
58.1
New Brunswick
56.6
Quebec
56.2
55
50
45
40
Nova Scotia
Ontario
65.4
35
Canada
Manitoba
62.2
Saskatchewan
63.7
Alberta
67.1
British Columbia
71.8
30
2009
2010
2011
2012
2013
2014
Index of 50 = equal balance of stronger and weaker
business expectations
Source: CFIB, Business Barometer Index, January 2014
www.cfib.ca
Main cost pressures
Fuel and energy costs (51%)
Tax and regulatory costs (49%)
Bank account and processing fees (39%)
Main operating pressures
Insufficient domestic demand (43%)
Management skills, time constraints (22%)
Shortage of skilled labour (19%)
www.cfib.ca
Do you support the planned introduction
of a new statutory holiday in Nova Scotia?
(% response)
No, 57
Don't know, 9
No answer, 1
Yes, 34
Source: CFIB, Nova Scotia Statutory Holiday Survey, January 2014, n= 474
www.cfib.ca
How confident are you that your
provincial government has a vision that
supports small business?
(% response)
27
50
58
72
79
79
84
88
15
ON
91
91
12
8
8
NS
MB
QC
72
48
40
27
SK
BC
AB
NL
Conf ident
21
PEI
Not conf ident
19
NB
Don't know
Source: CFIB, Provincial/Territorial Entrepreneurial Vision Survey, August 2013, n=7155 (NS=279)
www.cfib.ca
How likely would you be to recommend
starting a business in your province?
(% response)
10
24
28
40
51
56
57
60
64
74
88
72
68
58
48
SK
AB
NL
BC
PEI
Likely
Unlikely
40
ON
39
NB
36
NS
31
QC
Don’t know
Source: CFIB, Provincial/Territorial Entrepreneurial Vision Survey, August 2013, n=7155 (NS=279)
www.cfib.ca
24
MB
Nova Scotia’s Uncompetitive Tax
Environment – Personal Income Tax
Source: CFIB, Shameful Tax Facts, February 2014
www.cfib.ca
Nova Scotia’s Uncompetitive Tax
Environment – Sales Tax
Alberta
5%
Saskatchewan
5%
British Columbia
5%
7%
Manitoba
5%
7%
Ontario
5%
8%
New Brunswick
5%
8%
Newfoundland & Labrador
5%
8%
Prince Edward Island
5%
9%
Quebec
5%
9.98%
Nova Scotia
5%
10%
Federal Rate
Source: CFIB, Shameful Tax Facts, February 2014
www.cfib.ca
0%
5%
Provincial Rate
What should your provincial government
focus on to help your business thrive?
(% response)
Reducing the tax burden
79
Reducing red tape
51
Ensuring fair and equitable labour laws
27
Investing in transportation infrastructure (e.g.
public transit, bridges, roads and highways)
31
Developing a comprehensive approach to
address labour and skills shortages
38
Increasing access to grants
Marketing your province/territory across
Canada and internationally
26
19
Source: CFIB, Provincial/Territorial Entrepreneurial Vision Survey, August 2013, n=279)
www.cfib.ca
How government can help small business
thrive – Advice from members
 Realize that small business is the cornerstone to the success of the
economy and place more consideration in helping these
businesses rather than making it harder to succeed.
 I'd like it if we didn't have to compete against the government
when it comes to wages and benefits. We have lost several
employees over the past year who left us to work for the
government. We can't match what the government pays in hourly
wages!
 Reduce the tax burden, and start thinking broadly about the
Maritimes or Atlantic provinces to leverage our collective
strengths rather than competing amongst ourselves.
 We hope you will keep working with CFIB and keep educating
yourself on small business. It is the mainstay of our economy.
www.cfib.ca
Fiscal Recommendations:
Eliminate Bracket Creep
Source: CFIB, Bracket Creep Backgrounder, January 2014
www.cfib.ca
Fiscal Recommendations:
Increase SBTR threshold to $400,000
Current $350,000 threshold is lowest in
Canada
Standard across Canada is $500,000 –
only Manitoba still remains at $400,000
Increase to $400,000 with plan to move
toward $500,000 over time
www.cfib.ca
Red Tape Reduction
Red Tape Awareness Week
Announcements
Growler sales from brewpubs
Restaurant and Accommodations Industry
Sector Bundle Project
What’s next?
Measure burden
Report publicly
Legislate commitment
www.cfib.ca
Pension Reform:
Eliminate the Bridge Benefit
Nova Scotia members of the Public
Service Superannuation Plan can retire as
early as 55.
Plan members are eligible for a ‘top up’
until age 65 when full CPP benefits kick
in.
In Nova Scotia, the average ‘top up’ (i.e.
bridge benefit) is $8,154 a year.
Source: CFIB, The Case for Ending Early Retirement in the Public Sector, June 2013
www.cfib.ca
Pension Reform:
Introduce PRPPs
Should CPP premiums be
increased to expand benefits?
Undecided
10%
No interest
1%
Yes
19%
No
70%
 Do not support mandatory
increases to CPP
 Introduce Pooled Registered
Pension Plans (PRPPs) – voluntary
enrolment
 Fully disclose public sector
pension plan liabilities annually
 Convert vulnerable pension plans
to Shared Risk Model
Source: CFIB Mandate Survey, March-April 2013, n=9,977
www.cfib.ca
Recommendations: Fiscal
Set target to achieve balanced budget
Develop long-term plan to reduce the total tax
burden
Eliminate bracket creep
Increase Small Business Tax Rate Threshold
back to $400,000
www.cfib.ca
Recommendations: Red Tape
Measure, report and reduce overall regulatory
burden
Include measurement in budget document
Legislate commitment to red tape reduction
www.cfib.ca
Recommendations: Pension Reform
Eliminate the bridge benefit
Do not support mandatory increases to CPP
Introduce PRPPs
Publicly disclose public sector pension liabilities
annually
Convert vulnerable pension plans to Shared
Risk Model
www.cfib.ca