Sept. 11, 2025 "Canadian small businesses pay about 20 per cent more in taxes than U.S. companies: CFIB": Today I found this article by Joshua Santos on BNN Bloomberg:
Canadian small businesses pay more taxes than a corporation of similar size in the United States,
preventing owners from investing in the economy,
according to a new report from a national advocacy group.
The report from the Canadian Federation of Independent Businesses assesses tax competitiveness for microbusinesses and small businesses across Canadian provinces compared to U.S. states.
Canadian small businesses on average pay $374,000 in Canada
compared to U.S. companies that pay $304,000.
The CFIB says small businesses (24 employees or less) pay 24 per cent more in
income,
payroll
and property taxes
than their American counterparts.
“Small businesses are the cornerstone of our local economies, and we need to support them,” Bradlee Whidden, senior policy analyst for CFIB told BNNBloomberg.ca in a Thursday interview.
Small businesses in Quebec pay $425,000 compared to companies in South Dakota that pay $246,000.
Small businesses in Saskatchewan for example, which is the lowest taxed province, pay $27,000 more than the U.S. average.
“The Canadian economy is struggling right now,” said Whidden.
“The Bank of Canada says that we are in the midst of a productivity crisis,
which means that less goods and services are being produced that Canadian residents want and need
like housing units
and dentist appointments.
I think a lot of that shortfall can be directed at taxes. The United States is not having that problem like we are, and we found that they’re paying far less, or their small businesses are paying far less in taxes.”
The Canada Revenue Agency says Canadian private corporations, claiming the small business deduction, pay a net tax rate of nine per cent (4.5 per cent for manufacturers of qualifying zero-emission technology).
“We believe small businesses are paying too much in taxes here in Canada,” said Whidden.
“Currently, the federal small business income tax rate is nine per cent. We think that’s far too high and needs to be lowered.”
Provincial and territorial tax rates differ as Manitoba eliminated the small business income tax.
Ontario businesses meanwhile pay 3.2 per cent,
followed by Nunavut at three per cent
and Newfoundland and Labrador at 2.5 per cent.
Whidden said he wants provinces to follow the lead of other provinces.
The group calls on all levels of government to
lower corporate tax rates,
provide more tax relief
and create a more competitive tax environment for businesses
as they struggle with economic uncertainty,
and high operation costs amid U.S. President Donald Trump’s tariff trade war.
Whidden said Trump’s Big Beautiful Bill has made the tax gap between two countries even wider as legislation provides full expensing for
domestic costs,
capital investments
and research and development
and tax cuts enabling accelerated business investment.
It follows the Tax Cuts and Jobs Act of 2018.
He said he is concerned businesses will head down south
and that the federal government has little geared towards small businesses to expense and accelerate spending.
Methodology
This analysis presents figures in each country’s local currency. Variables were selected for each business type based on what was reasonable for their size.
For small businesses and microbusinesses, these include pretax net income ($1 million and $150,000), the number of employees (four and 25), and business property value ($450,000 and $3 million).
Taxes that are treated as business expenses, such as payroll and property taxes, reduce taxable income before the remainder is subject to income taxes.
Local taxes such as municipal property taxes assume the business is located in the largest municipality in each province or state.
Five of the most populous U.S. states were selected for the comparisons, with the remaining 15 chosen based on their trade exposure and geographic proximity to Canada.
Sept. 16, 2025 "Trade dispute, consumer spending slowdown hurting small businesses: Equifax": Today I found this article by Ritika Dubey on BNN Bloomberg:
Small businesses across Canada are facing challenges as
consumers cut back on spending
and navigate a complicated trade landscape,
a new Equifax Canada report showed.
More than 286,000 businesses missed at least one credit payment in the second quarter,
up 5.6 per cent from a year ago, the agency’s business credit trends report published Tuesday, found.
A higher delinquency rate was “expected to a certain degree,” said Jeff Brown, head of commercial solutions at Equifax Canada, though he added that even he was surprised at the size of the increase.
“When we see delinquency levels peter over more than five per cent growth year-over-year,
that’s a sign that something is either happening within our market
or there’s distress coming up,”
he said.
The report suggests sectors tied to
international trade
and consumer discretionary spending
are under stress in particular.
Delinquency levels in consumer-sensitive industries
— such as accommodation
and food services,
retail trade,
and arts and entertainment
— remain elevated year-over-year.
Accommodation and food services businesses saw delinquencies jump 29.5 per cent,
while missed credit payments in the retail trade were up 13.3 per cent.
Arts, entertainment and recreation businesses saw delinquencies rise 7.5 per cent.
Higher delinquencies come as consumers have reined in their spending amid the higher cost of living.
Brown said the cost of essentials such as groceries and rent continues to climb,
which has impacted household discretionary spending
and, in turn, hurt businesses that provide non-essential goods and services.
The average credit card spend per consumer declined 0.4 per cent from June 2024, when adjusted for inflation, the report showed.
Brown said broadly speaking, businesses are facing the impact of an economic slowdown, while many still have a lot of pandemic-related debt to pay off.
“When we have a reluctancy for consumers to spend, and we have trade uncertainty hitting certain industries, really, it is a bit of a challenge,” Brown said.
The Canadian economy has been under pressure from tariffs imposed by U.S. President Donald Trump, with the manufacturing industry one of the hardest hit.
While many exporters have been adapting to ensure their goods are eligible to enter the U.S. tariff-free under the Canada-U.S.-Mexico Agreement,
the steel, aluminum and auto sectors continue to face sector-specific levies.
Not all subsectors in manufacturing bore the same brunt though.
Heavy metal manufacturers, for example, saw their delinquency rate spike 12.1 per cent while the automotive industry appeared resilient in the first half of the year, thanks to relatively strong sales.
The report also found the delinquency rate on bank loans, such as credit cards, lines of credit and mortgages, was higher compared with business-to-business payments,
suggesting firms were prioritizing making payments to suppliers to keep their relationships with them in good standing.
Brown gave the example that if you’re operating a restaurant,
“you want to make sure that you have a great relationship with your core supplier of bringing in food products
so you can have customers in your door,
and you can bring in more money.”
While many small business owners struggle to keep up with their payments,
some are putting expansion plans on the back burner.
The growth projection portion of Equifax Canada’s small business health index fell 2.4 per cent as businesses hold back on investing further into their operations.
Brown said the upcoming federal budget could be a silver lining for small businesses since they could benefit from targeted relief programs.
“We’re all watching to see what happens in October when the fall budget does come out, and that’s really kind of the light at the end of the tunnel,” he said.
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Ritika Dubey, The Canadian Press
This report by The Canadian Press was first published Sept. 16, 2025.
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