Madam Speaker, today I rise to speak to the amendment put forward to strike clause 34 from Bill C-15, the budget implementation act.
Clause 34, as it stands, will amend the Income Tax Act in a manner that would increase the small business income tax rate to 10.5% instead of continuing its scheduled decrease to 9%. Right this minute, the Income Tax Act, as currently written, will continue to lower the small business tax rate down to 9%. The removal of clause 34 from Bill C-15 will be an important gesture to demonstrate the commitment that the government made to small businesses during election time. During the 2015 campaign, all parties promised to reduce the small business tax rate and continue the outlined reductions put forward by our previous Conservative government.
We understand that small businesses are the backbone of our communities and are essential for job creation and a robust economy. As a result, the government should be encouraging small business owners and ensure that they have access to low tax rates. However, the Liberals seem to think differently. This is exactly why clause 34 is so concerning. This clause seeks to break one of the key promises previously made by the current Liberal government. I strongly believe that this reduction is crucial to motivating small businesses to grow and prosper.
As the former coordinator of the small business programs at both the Vancouver Community College and Kwantlen Polytechnic University, I have trained many business owners in leadership and business development. There are many challenges that small business owners face, whether it is working long hours, sacrificing time spent with family and loved ones, or the personal expense. However, when it is time to mature as a business, and at the point of decision to expand or not, the ability to reinvest is key and perhaps the greatest challenge. The question is to expand or not to expand.
This is exactly true for female entrepreneurs. I have had the opportunity to witness the growth and prevalence of female-run businesses, through the British Columbia Women's Enterprise Centre. Tax burdens, whether personal or business, have always been a great challenge to creating access to the money they require in their own pockets to reinvest. Additionally, my involvement as one of the founders of the Ethno Business Council in B.C. and my personal business experiences both demonstrate that tax burdens weigh particularly heavily on immigrant entrepreneurs.
While I was completing my doctoral dissertation at the University of British Columbia, I focused my research on studying the business cycle of immigrant entrepreneurs. What I found then, and what I continue to witness, is that immigrant business owners require as much encouragement and assistance as possible, not as a handout, but real encouragement in low-tax policies and business development opportunities.
Over the past several months, I have continued to meet with business leaders in my own riding and from across the country. One concern continues to ring out most clear. Lower tax rates, whether federal, provincial, or municipal, are crucial to small business development. It is not for the government to choose winners and losers. However, that is exactly what we have seen. The current Liberal government has chosen small businesses as the losers.
On several occasions, the Minister of Small Business and Tourism has stood in this House and promised to reduce the tax rate for small businesses. She promised that she was working with the Minister of Finance and other colleagues to ensure that the voice of small business owners were heard. Unfortunately, that was all for nothing.
Instead, the Liberals have deliberately and blatantly left small business out of the budget and show no indication of following through on their promise. Small businesses across the country feel slighted and have witnessed first-hand the broken promises of the Liberal government. However, by accepting this motion, the Liberal government would be able to demonstrate to small businesses that it recognizes their worth and seeks to support and encourage growth for lower tax rates.
As research and data emerge regarding the government's decision to eliminate the tax rate reductions, we are gaining a clear picture of just how much this will cost our small business owners. According to the Canadian Federation of Independent Business, the CFIB, this decision will cost small and medium-sized firms over $900 million, compared to the government letting the scheduled small business tax reductions stand. That is a cost of nearly $1 billion that the Liberal government is placing on our hard-working middle class. Instead of alleviating the burden on our middle class, the Liberals are actually adding to their burden.
There is no doubt that small businesses stimulate our economy and encourage growth. The president of CFIB, Dan Kelly, stated that “The simple truth is Canada's small business owners are overwhelmingly middle class. They are your mechanic, accountant, hair dresser, and landscaper, just trying to earn a living doing something they love.”
The Liberals are looking for a way to pay their debt by placing it on the backs of our small businesses. Our middle class is not responsible for the Liberals' reckless spending. This I have mentioned before. When small businesses are paying more in taxes, it means they have less money in their pocket to reinvest in their businesses. Whether these investments materialize as hiring new employees, seeking out new business opportunities, or expanding their market, each is important, and this budget will inhibit any type of growth.
I am proud to support this motion to amend Bill C-15, and I strongly encourage all members of the House to do the same. We need to invest in our small and medium businesses and provide them with tools and funding to help them succeed, not just in the start-up phase, but throughout their entire business cycle. Small business owners are counting on us. We need to demonstrate that we value their hard work.