In a statement from its representatives, the Canadian Federation of Independent Business (CFIB) asked the Ontario government to lower small business taxes to address its Ontario members’ most pressing concern, enhance tax competitiveness, and promote economic growth at a crucial time.
Three CFIB Ontario representatives – Angela Drennan, vice president for legislative affairs; Julie Kwiecinski, director of provincial affairs; and Joseph Falzata, policy analyst – issued the statement on behalf of the CFIB’s more than 39,000 small- and medium-sized business members in all sectors across Ontario, in response to the province’s 2025 fall economic statement.
The CFIB encouraged the provincial government to invest in improving tax competitiveness via the March 2026 budget. Specifically, the CFIB called for changes to the small business tax rate (SBTR) and eligibility threshold, business education tax rates, and employer health tax exemption threshold to enable small businesses to invest in economic growth.
According to its research, the CFIB noted that lessening the province’s overall tax burden will enable its Ontario members to utilize savings to raise employee compensation (51 percent), grow their operations (44 percent), and/or hire new employees (34 percent).
“We hope the Tax Action Plan mentioned in today’s announcement will focus on lowering the SBTR from 3.2%-2% and raising its eligibility threshold from $500,000-$700,000,” the statement said. “These two measures together would provide up to $25,000 in annual savings for a small business.”
The CFIB noted that Ontario’s SBTR ties with Quebec as the highest in Canada and has remained unchanged since 2020. The CFIB added that the province has maintained the same eligibility threshold since 2007.
“The Ontario government could make these two SBTR investments in small business using some of the remaining $4B in the Protect Ontario Account under the second or third streams noted,” the statement said.
The CFIB acknowledged the positives in the fall economic statement, including the return of Workplace Safety and Insurance Board (WSIB) surplus funds to eligible Ontario employers and other previously announced measures under the $30 billion tariff relief package benefiting businesses.
The CFIB said it was eager to review Ontario’s economic outlook document and take part in the 2026 pre-budget consultations.
Tariff impacts
In the statement, the CFIB representatives noted that tariffs have resulted in a climate of economic unpredictability and impacted all sizes of businesses, with Ontario’s small businesses experiencing both direct and indirect effects.
According to the CFIB, since small businesses often lack the time and resources to seek and apply for programs that might ultimately deem them ineligible, they require direct measures such as WSIB surplus rebates to adapt to the issues arising from tariffs.