Small business tax cut never promised to offset minimum wage hike: Wynne
Says the government will have to assess the impact of the wage increase as it continues to roll out.
TORONTO — Ontario’s premier says a tax cut for the province’s small businesses is intended to support them but may not fully offset the impact of an increasing minimum wage.
Kathleen Wynne says that while the province had promised small businesses support, there was never a commitment to offset the effect of the wage hike.
She notes that the government will have to assess the impact of the wage increase as it continues to roll out.
The province announced in its fall economic update yesterday that it will cut the corporate tax rate for small businesses from 4.5 to 3.% effective Jan. 1, 2018, the same day the province will increase its minimum wage from $11.60 to $14.
The government’s plan will eventually see minimum wage jump to $15 an hour by Jan. 1, 2019.
The Canadian Federation of Independent Business says the tax cut is welcome but will not be enough to offset the impact the minimum wage hike has on small businesses.
An economic analysis by the province’s economic watchdog, the Financial Accountability Office, estimated more than 50,000 people could lose their jobs due to the minimum wage increase.