Some good news for small business. The government, in this budget, will invest $225 million to expand and extend the temporary Hiring Credit for Small Business for one year. This will provide a credit of $1,000 as against a small business employer’s increase in its 2013 EI premiums over those paid in 2012.
For those established businesses and those looking at retiring, slowing down and/or passing on their business within the family or selling, the government is providing an increase to the Lifetime Capital Gains Exemption. It will be increased to $800,000 and will be indexed to inflation for future. This is an increase to the support for small business owners, farmer and fishermen. It will help these entrepreneurs to better ensure their financial security for retirement and will facilitate the intergenerational transfer of their businesses.
The temporary accelerated capital cost allowance for new investment in machinery and equipment in the manufacturing and processing sector has been extended for an additional two years, at a cost of 1.4 billion.
The 2013 budget provides $60 million over five years to help outstanding and high potential incubator and accelerator organizations in Canada expand their services to entrepreneurs, and makes available a further $100 million through the Business Development Bank of Canada to invest in firms graduating from business accelerators.
The federal Labour Sponsored Venture Capital Corporation tax credit which has been criticized as being an ineffective means of stimulating a healthy venture capital sector will be phased out by 2017.
Other good news initiatives are the new Building Canada plan to build roads, bridges, subways, commuter rail and other public infrastructure by cooperating with the provinces, territories and municipalities. Details regarding Canada’s Temporary Foreign Worker Program will be announced in the coming months. The government will work with employers to ensure that all efforts are made to hire Canadian workers before temporary foreign workers are considered. The government noted that it will also propose to introduce user fees for employers applying for temporary foreign workers through the labour market opinion process so these costs are not absorbed by taxpayers.
The Canadian Chamber of Commerce “praises this cautious approach as it will provide the government with greater flexibility to handle unanticipated adverse events.” “We urge the government to press forward with the further measures we have proposed to secure Canada’s economic future.” Read more about Canadian Chamber’s Top 10 barriers.