Mr. Speaker, I am delighted today to support my colleague's opposition day motion and to continue our government's strong support for middle-class consumers and small business owners and operators. I would like to say that I will share my time with the hon. member for Willowdale.
It is no secret that small business is the lifeblood and the engine of our economy. Small businesses account for 99% of all businesses in this country and employ half of the working men and women in the Canadian private sector. Our government believes that small business owners should spend their time growing their businesses and creating jobs, not battling high taxes and red tape. We have already cut taxes significantly for small businesses and their owners. We cut the small business tax rate to 11% in 2008, and increased the amount of annual income eligible for this lower rate from $300,000 to $400,000 in 2007 and then to $500,000 in 2009. This makes a huge difference to small businesses.
We cut the general corporate income tax rate to 15% in 2012 from approximately 22% in 2007. That is a 30% reduction in tax for corporations generally. This reduction benefits successful small businesses on their way to becoming big businesses when their income exceeds this $500,000 income level.
We increased the lifetime capital gains exemption on qualified small business shares from $500,000 to $750,000 in 2007. The government further increased the exemption to $800,000 in 2014, indexed the new limit to inflation, and further increased this exemption to $1 million for farmers and fishermen in 2015. The lifetime capital gains exemption is estimated to be delivering over $1 billion in federal tax relief annually for small business owners, including farm owners and fishermen.
We also reduced small business EI premiums by introducing the small business job credit. This credit is expected to save small businesses more than $550 million in the next year or so.
To further encourage small business growth, last month's budget proposed to further reduce the small business tax rate by nearly 20% by 2019, taking it down to just 9%. For a small business with taxable income of $500,000, this tax cut and other tax relief the government has provided since 2006 would result in an overall federal tax reduction of 50%. It is cut in half.
However, small business owners and operators in my riding of Vegreville—Wainwright would be alarmed to know that the Liberal leader said he would reverse our tax cuts to small business. I also note that both the NDP and the Liberal Party would dramatically hike payroll taxes for small businesses and their workers.
The Liberal leader has said, “We're looking at an expansion and a mandatory expansion of the CPP of the type that Kathleen Wynne put forward in Ontario.” That is what he said. He wants a mandatory expansion to the CPP. For someone earning $60,000 per year, the Liberal leader's policy would be a cut of $1,000. That would be in addition to the $1,000 payroll tax increase that would have to be paid by the small business owner. To be clear, not only would this mandatory increase in payroll tax reduce employees' take-home pay, but it would also force small businesses to cut jobs, hours, and wages for their employees. That is simply what would happen.
When it comes to promoting job creation and economic growth, which ultimately benefit all Canadians, including consumers, our government continues to make responsive and responsible decisions. Our government is implementing policies focused on raising Canada's economic potential and creating stable, well-paying jobs.
However, we cannot be complacent. These are tough economic times here at home and right around the world. Small businesses are stretching dollars as far as they can go, and they need support so that our economy can continue to grow. That is why our government took action to address credit card fees. Every time a merchant accepts a credit card payment, he or she pays fees, and, as is the case with any other cost, fees can affect prices for consumers and usually do.
Last fall we accepted voluntary commitments by Visa Canada and MasterCard Canada to cut credit card fees by close to 10%. This is meaningful. Specifically, the proposals from Visa and MasterCard include voluntarily reducing their respective credit card fees for consumer cards to an average effective rate of 1.5% for a period of five years and ensuring that all merchants receive a reduction in credit card fees. More importantly, Visa and MasterCard started to implement the reductions this past April, so they have already kicked in.
The purpose of these voluntary commitments is simple. It is to reduce the cost of credit card acceptance for merchants in order to keep prices lower for consumers. Let me reassure the House that, as the finance minister has said:
If Visa or MasterCard do not comply with their public commitments the Government will take all necessary measures to keep prices low for all consumers.
Let me turn members' attention to the enhanced code of conduct for the debit and credit card industry that was announced in last year's budget. It aims to promote fairness in the credit card market and addresses the issues that businesses told us about.
We worked hard to fix the problems. Merchants will now have a new, more user-friendly complaints process for code-related complaints. We are improving disclosure requirements within contracts. Businesses will have more flexibility to exit their contracts without penalty. In addition, the code will now apply to mobile payments.
This stronger code also offers new protection for consumers. Credit card issuers will have to inform consumers that using premium cards may mean higher fees, so there will be new branding requirements for premium cards to make them more easily identifiable. We are also introducing new protections with mobile devices so that consumers have choice.
We want to go even further than this. Every year Canadians make roughly $24 billion in payments. More and more of these transactions are being made electronically. However, while debit, credit, and prepaid cards are subject to federal regulations, digital and electronic wallets largely are not. That is why our government launched public consultations on the national retail payments system. We want to hear what Canadians think about the way that they pay so that our consumer protection will continue to be cutting edge.
In conclusion, taking together all that has been done since our Conservative government was elected, I can say with confidence that protecting consumers and supporting small business remains a central focus of our government.
We are working with the provinces and territories to make consumer protection regimes more robust and to defend Canadians using high interest rates and payday lending products. We have worked with the financial sector to ensure that Canadians benefit from greater transparency and pricing disclosure. At the same time, we are defending consumers from having to pay the costs associated with the high-tax agenda of the Liberals and the NDP. That is something that consumers should think about more. Canadians generally should think about that more. What would the consequences be of electing a Liberal or NDP government in the next election? It is something that I do not like to think about, because I do not like higher taxes, but that is what the result would be.
The NDP has pledged to implement a carbon tax that would raise the price for consumers on groceries, gas, and everything else. This is something I will not support, and my constituents simply will not support it either.