By: Monica Kucharski
If you’re one of the many small business owners worried about the impact of the impending hike in the minimum wage from $11.60 to $14 commencing Jan. 1, 2018, there maybe some encouraging news for you in the Ontario government’s fall economic statement released this week.
The government announced that the corporate tax rate for small businesses will fall from 4.5 per cent to 3.5 per cent, effective Jan. 1, 2018—the same date for the legislated increase in minimum wage. The provincial government intends this tax cut as a way to offset the increase in wage expenses.
There are also other initiatives announcements in the fall budget that should gladden small business owners.
The Ontario government is promising to:
• designate that one-third of its procurement spending on goods and services will come from small and medium-sized businesses by 2020
• spend $124 million over three years to help companies with fewer than 100 employees who hire youths aged 15 to 29. Businesses will receive incentives of $1,000 for each worker hired in this age group, and another $1,000 if such an employee is retained at least six months
• transform the current apprenticeship training tax credit into a grant, giving employers $2,500 upon an apprentice’s completion of both level one and level two, $3,500 for completion of levels three and four, and $4,700 upon an apprentice’s certification
• extend the apprenticeship grant to include five additional trades: hairstylist, cook, horticultural/landscape technician, baker, and appliance service technician
The anticipated wage hike has been a hot political button and a huge concern for small business owners in Mississauga and across the province ever since it was announced earlier this year. Many business owners planned to reduce their staff and/or other expenditures in order to cope with this significant increase in minimum wage.
The Ontario government initiatives announced in this fall’s budget should ease the wage hike burden on small businesses, the engine of our economy. At least that’s what our pre-election provincial government is hoping!