The Canadian Federation of Independent Business (CFIB) is renewing calls for the federal government to reduce the overall payroll tax burden on small businesses, following today’s announcement of an increase in the 2018 Employment Insurance premium rate.
The 2018 EI rate for employees, set by the Canada Employment Insurance Commission (CEIC), is $1.66 per $100 of insurable earnings, a three-cent jump from 2017. Employers will pay $2.32 per $100 of insurable earnings, an increase of four centsfrom the previous year.
“This latest increase means that payroll budgets of every business will increase for six straight years when you take into account that the 2018 EI increase will be followed by five years of CPP premium hikes starting in 2019,” said Corinne Pohlmann, Senior Vice-President, National Affairs at CFIB. “These tax hikes — which come amid the spectre of the federal government’s proposed tax changes — will make it more difficult for small business owners to hire more workers, raise salaries and grow their businesses.”
In a recent CFIB survey of members, Employment Insurance was identified as a “serious” concern for 43 per cent of small businesses; total tax burden, including EI, CPP, and Workers’ Compensation costs, was the top concern.
To reduce the payroll tax burden on small business, CFIB will continue to push the federal government to adopt the following measures:
CFIB is Canada’s largest association of small and medium-sized businesses with 109,000 members across every sector and region.