Category Advocacy

Following last month’s federal budget, Finance Minister Bill Morneau defended Canada’s corporate tax regime and cited regulatory issues as a priority for dealing with Canada’s competitiveness problems.

While there is no credible defence for our hopelessly outdated tax system, he was correct that Canada’s regulatory systems have put Canada at a competitive disadvantage. As we outlined in a report a few months ago, Canada absolutely needs a comprehensive review of our uncompetitive, cumbersome and inefficient tax system. Given the Minister’s post-budget assertion, it is an opportune time to take a quick walk through the good, the bad and the ugly of federal efforts to address Canada’s regulatory competitiveness problem.

The good: In its November 2018 Fall Economic Statement, the federal government proposed an ambitious regulatory reform agenda, largely based off our recommendations in our May 2018 report, Death by 130,000 Cuts: Improving Canada’s Regulatory Competitiveness.

The bad: Budget 2019 had little to no progress to report on fulfilling those Fall Economic Statement commitments.

The good: Both the Fall Economic Statement and the Budget stated the federal government will consider legislative changes to make regulatory efficiency and economic growth a permanent part of regulatory mandates. This is a key recommendation of ours and is one of the most important changes needed in the federal regulatory environment. Many regulators are currently not giving appropriate consideration to economic growth and competitiveness impacts in their decision making because they are not required to.

The bad: There is very little time left in the parliamentary calendar before the federal election for the government to actually introduce and pass new legislation.

The good: The Budget introduced the concept of ‘regulatory roadmaps’ and provided $220 million in funding for three regulators (the Canadian Food Inspection Agency, Health Canada and Transport Canada) to make their regulatory systems more user friendly, to use novel or experimental regulatory approaches and facilitate greater regulatory cooperation and less duplication.

The bad: If the activities listed as part of these ‘roadmaps’ sound like something all regulators should already be doing, it is because they should be. While the roadmap process will lead to regulatory improvements in these areas, businesses are looking for more than three regulators being given $200 million in funding to do the work they are already supposed to be doing, according to the government’s own regulatory management policies.

The ugly: The job of leading federal regulatory reform falls to the President of Treasury Board, and the federal government started in 2019 by shuffling three different Ministers in and out of the role in three months (apparently it’s all Scott Brison’s fault). No, it is not Scott Brison’s fault. In fact, we owe him thanks for proposing the federal government’s regulatory reform agenda. However, the instability at Treasury Board raises serious questions about the department and the federal government’s ability to live up to its regulatory commitments.

What should Canadian businesses take from all this?

The good is that the federal government recognizes the regulatory problems confronting Canadian companies and has made a series of promises to start resolving them.

The bad is that most of these promises have not been fulfilled. Canada’s regulatory problems continue to be a serious problem for our economy, and there is little time left before this fall’s federal election to make substantive progress.

The hopeful is that all political parties put systemic regulatory reform at the centre of their election platforms. This will position the federal government to start working with the business community on the first day after the federal election to continue working to eliminate these systemic, incessant, self-imposed barriers to economic growth.

This “5 Minutes for Business” was authored by the Canadian Chamber of Commerce, one of whose members is the Sarnia Lambton Chamber of Commerce.

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With a recent Ontario government announcement of new legislation intended to cut unwanted regulations, also known as “red tape,” the Sarnia Lambton Chamber of Commerce is open to hearing from members with specific stories about how they are impacted by needless bureaucracy.

As part of our ongoing advoacy efforts on behalf of all members and at all levels of government, we’ll be making sure those stories are heard.

”The fact is, governments at every level have had a habit of adding needless regulation over the years, with complexity translating into extra work but not a lot of value for the business,” said Chamber president and CEO Shirley de Silva. “More often than not, those regulations simply add cost, which makes not only businesses less competitive but makes the price of goods and services more expensive.”

Share your story by email (CLICK HERE) or reach out anytime to the Chamber office: (519) 336-2400. We’re listening!

 

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News of a Provincial Government initiative that would see the creation of a Central Procurement system for the public sector has some members of the Sarnia Lambton Chamber of Commerce concerned about the effects such a strategy would have on small and medium-sized businesses that currently supply goods and services.

Whether it be hospitals, school boards, or other bodies that might fall under such a system, questions about how a Centralized Procurement System would help small businesses outside the Greater Toronto Area are being raised.

We want to hear from our members and local public sector organizations so that we can take your concerns to the OCC and to the Ontario Government.

Plans are beginning for a roundtable discussion on Centralized Procurement.

Stay tuned as these plans begin to take shape.

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Earlier this week, representatives of the Sarnia Lambton Chamber of Commerce made the trip down the 402/401 to Queen’s Park to participate in “Advocacy Day,” an initiative organized by the Ontario Chamber of Commerce.

With the provincial government approaching the one-year mark of its mandate, Advocacy Day is a forum to share ideas on how to foster a competitive business climate and strong, prosperous communities.

Attending on behalf of the local Chamber were Chair Ryan Bell and CEO Shirley de Silva (pictured).

“These are a rare but welcome opportunity for Chambers across the province to present a united front when it comes to putting forward our voice on issues that are critically important to all our members,” said de Silva.

This year’s event, which took place on Monday, March 25, included:

—Queen’s Park question period
—Town hall meetings with government and opposition MPPs
—Small group consultations with senior government officials
—Closing reception with MPPs

“Increasingly, those in government look to businesses—as represented by the Chamber of Commerce—for leadership on issues that drive the economy, not only for our area but across the province,” said de Silva.

 

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Representatives of the Sarnia Lambton Chamber of Commerce—Board chair Ryan Bell and President and CEO Shirley de Silva—will be heading to the provincial capital later this month to engage with legislators and their staff as part of Advocacy Day 2019.

The event, which is organized by the Ontario Chamber of Commerce (of which we are members), will include visits with several Provincial Government ministers and staff, with opportunities to have conversations outlining the position of businesses regarding various issues.

The full-day event will include attendance at Queen’s Park question period, town hall meetings with government and opposition MPPs, small group consultations with senior government officials, and a closing reception with MPPs.

‘These conversations are very important as we continue our advocacy efforts on behalf of Chamber members,” said de Silva.

“Although this is an event that brings together representatives from Chambers across the province, we’ll be making sure that issues that are of local importance are part of the conversations that take place.”

The Advocacy Day event takes place on Monday, March 25 at Queen’s Park in Toronto.

 

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This week’s announcement of a grant from the Transport Canada Airports Capital Assistance Program that will be used to complete improvements at the Sarnia Chris Hadfield Airport is an important milestone for Sarnia-Lambton.  The formal announcement was made by Kate Young, MP for London West. Young is Parliamentary Secretary to the Minister of Science and Sport and also to the Minister of Public services and Procurement and Accessibility.

Shirley de Silva, president and CEO of the Sarnia Lambton Chamber of Commerce, was in attendance at  Wednesday’s public announcement at the airport. Through ongoing efforts, including last summer’s Business After 5 that was held at the airport, the Chamber has formally advocated for the improvements.

“We continue to make the point that having a well-maintained airport facility here in Sarnia is an economic driver for us,” said de Silva.  “Our members, who know and understand just how critical this piece of infrastructure is to our future, are behind us and continually bringing forward their key inputs forward. This week’s announcement is a great example of how important these conversations are to the process,” she added.

Also attending were officials from the City of Sarnia, including Mayor Mike Bradley,  representatives of the City-owned airport management team and the Sarnia Lambton Economic Partnership.

In the photo, from left, are Stephen Thompson, CEO of SLEP, Shirley de Silva, MP Marilyn Gladu, MP Kate Young, and Sarnia Mayor Mike Bradley.

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Fifty years of cutting and pasting has left Canadian taxation uncompetitive, cumbersome and inefficient.

Now more than ever a Royal Commission on taxation, with everything on the table, is needed to align Canada’s tax system with the economy of today and tomorrow.

Much has changed since the Carter Royal Commission created the basis of our tax system in the 1960s. New technologies, global supply chains and international competition have disrupted entire industries. Governments worldwide are competing to harness innovation by trying to understand how new developments like artificial intelligence and the sharing economy will reshape how we live and work, including how we tax.

The pace of change in today’s economy requires capital investments, investments in talent and skills as well as organizational agility to keep up and compete. According to the Canadian Chamber of Commerce’s report on Canadian tax competitiveness, our tax system falls flat on all three counts. The Canadian business community believes the accelerated capital cost allowance measures announced in last year’s Fall Economic Statement lack what is needed to spur the necessary investments. Our dauntingly byzantine federal tax system ranks 41st in the world in the time it takes to prepare and pay taxes. Canadian businesses are concerned the personal tax bracket structure on high income-earners will drive highly skilled workers elsewhere.

It is clear Canada’s outdated tax system has real costs—both in terms of money and time—for Canadian business. It has real implications for strategic, tactical and operational decisions.

The changing global tax environment not only provides an excellent opportunity for Canada to rethink its own system but practically requires it. If we look at G7 and OECD countries, there is a prolonged trend toward greater tax competitiveness. The OECD has encouraged Canada to “[r]eview the tax system to ensure that it remains efficient—raising sufficient revenues to fund public spending without imposing excessive costs on the economy—equitable and supports the competitiveness of the Canadian economy.” Similarly, the IMF executive board of directors has suggested Canada conduct “a careful and independent review of the overall Canadian tax system, weighing the pros and cons of incremental versus more radical approaches, and assessing their revenue implications and potential spillovers to other countries.”

A Royal Commission’s terms of reference should be guided by the principles of tax competitiveness, simplicity, fairness and neutrality. The inquiry should explore the following aspects of Canada’s tax system through a comprehensive review:

  • Broadening the tax base to explore the most effective tax policy solutions
  • Adjusting the tax mix to better promote business investment and economic growth
  • Bridging the digital tax divide to ensure a fair and equitable tax system
  • Simplifying the tax filing experience with digital filing solutions
  • Legislating a Taxpayer Charter of Rights to hold the Canadian Revenue Agency (CRA) accountable
  • Providing a representative for small business to resolve conflicts with CRA
  • Conducting regular comprehensive reviews to keep the tax system up to date

If Canada is serious about enhancing its competitiveness, we need to focus on how governments can use tax policy to harness disruption and new global business models. It is crucial we recognize a modernized tax system can be a key driver of Canada’s business innovation and economic growth.

The above was provided by the Canadian Chamber of Commerce, an organization that includes the Sarnia Lambton Chamber of Commerce among its members.

 

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The Ontario Chamber of Commerce earlier this week (Tuesday, February 19) released its third annual Ontario Economic Report (OER), offering a unique perspective on the experience of businesses of all sizes across the province. Through the Business Confidence Survey, the Business Prosperity Index, and the Economic Outlook, this report presents a candid look at private sector sentiment and opportunities for economic growth for the year ahead.

“New research shows that businesses are gaining confidence in Ontario’s economic outlook as well as gaining confidence in themselves,” noted Shirley de Silva, president and CEO of the Sarnia Lambton Chamber of Commerce, which is a member of the OCC.

The entire OER can be seen HERE.

Rocco Rossi, president and CEO of the OCC, said challenges relating to access to talent, embracing technological innovations, and the cost of doing business—including regulation, taxation, and input prices—remain major sources of concern to businesses in the province.

“Ontario’s overall prosperity depends on the strength of its regional economies, yet these vulnerabilities are expected to be most acutely felt in rural regions of the province,” said Rossi. “We should all be concerned that the province’s employment growth has been largely concentrated in the Greater Golden Horseshoe since 2003, while other regions have experienced slow or even negative growth during that same period.”

The OCC document is aimed at shaping and informing future public policy and will act as a reference and benchmark for debate and policy change.

Key takeaways from this year’s Ontario Economic Report include:

  • Confidence in Ontario’s economic outlook has improved. Thirty percent of members surveyed expressed confidence in Ontario’s outlook for 2019, up seven percentage points compared to last year.
  • Despite a more optimistic outlook for 2019, decreasing levels of organizational and economic confidence over the years have impacted business’ willingness to invest, take risks, and adopt technological advancements.
  • Businesses are gaining confidence in themselves. Sixty-one percent of respondents reported confidence in their own organization’s economic outlook heading into 2019, a seven-point increase from last year.
  • Revenue projections for 2019 are more positive than those of 2018. Eighty-six percent of respondents believe their organization’s revenues will increase or stay the same over the next twelve months, with only fourteen percent anticipating a decline. This represents a notable change in direction from 2018, when 27 percent were projecting their revenue to decrease.

“This year will be a formative one for the Ontario economy,” said de Silva. “Along with the OCC, we urge decision-makers to develop thoughtful policies that foster competitiveness and address the potential vulnerabilities that loom large within our province,. We need to take action and address these challenges to build a stronger Ontario for today and tomorrow.”

As Ontario’s economy continues to face many challenges outlined in the OER, the OCC’s 2019 Ontario Economic Summit will be dedicated to the question of competitiveness with an agenda that will explore how our province can lead in innovation, knowledge-generation, and trade. The OCC will be engaging its members, government and other leaders to explore these issues and develop the necessary solutions to drive forward a competitive province for years to come.

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The Ontario Chamber of Commerce (OCC), the provincial organization that includes the Sarnia Lambton Chamber of Commerce in its network of local affiliates, has provided the Government of Ontario with 13 tangible recommendations for the upcoming provincial budget to build a stronger Ontario and create a business climate which encourages growth.

The OCC presented the submission to the Standing Committee on Finance and Economic Affairs, calling on the government to prioritize small business tax reforms, strategic infrastructure investment, and value-based procurement in Budget 2019.

The full submission from the OCC can be viewed HERE.

In an OCC survey last year, 48% of Ontario businesses indicated they were not confident about the province’s economic outlook and 61% of these cited high tax rates as a reason. As the province heads into a time of economic uncertainty coupled with the province’s staggering deficit, the submission calls on the government to focus on fiscally sustainable and long-term taxation priorities. Currently, business with an income of less than $500,000 are taxed at a flat rate. To create an environment which encourages small and medium business to successfully scale, the OCC recommends the government create a variable small business deduction in Budget 2019.

“Small businesses are the backbone of the economy and the heart of communities in all regions of the province. Yet, cumulative red tape, U.S. tax reforms, economic uncertainty, and a system that discourage growth have led to a staggering scale-up challenge for businesses of all sizes across Ontario,” said Michelle Eaton, vice president of Communications and Government at the Ontario Chamber of Commerce. “We are encouraging the government to address these challenges, focusing on fiscal balance and smarter spending in the upcoming budget to help Ontarians today and into the future.”

The OCC is also urging the government to strategically spend in key areas that will help grow the economy and have the highest return on taxpayer dollars such as expanding broadband access and strengthening critical transportation infrastructure. The OCC also recommends removing red tape for small and medium businesses to access procurement opportunities, leading to employment, economic growth, innovation, and cluster development.

“We applaud the government’s commitment to reduce the debt and deficit as well as cut red tape by 25 percent by 2022 in the 2018 Fall Economic Statement,” added Eaton. “Yet, more work must be done to build a stronger Ontario and create an environment which encourages growth. We look forward to working with the government to support evidence-based policies that drive growth and contribute to a stronger province for all.”

The OCC represents 60,000 business of all sizes in over 135 communities across the province. The pre-budget recommendations stem directly from the Ontario Chamber Network’s policy resolutions presented at the OCC’s Annual General Meeting.

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The federal government recently announced it had made available $1.6 billion to support Canada’s struggling oil and gas sector. While the Federal Government’s recognition of the crisis faced by Canada’s energy sector was welcome, the funds are a “band-aid” solution to what is a much larger structural issue.

Our regulatory system continues to put Canadian jobs and Canadian prosperity in jeopardy. We cannot get our energy products to global markets because not even the Federal Government seems able to get major infrastructure projects approved, let alone businesses.

A recent report by the Canadian Chamber of Commerce—A Competitive Transition: How Smarter Climate Policy can help Canada lead the transition to a low carbon economy—made it clear our energy resources are of strategic importance. Canadian oil and gas producers must be given the opportunity to lead Canada’s strategy to reduce emissions, because only they know how to make investments and drive innovation.

Getting support right for this sector is not about offering the sector loans; it is about creating a regulatory system that will get projects like the Trans Mountain Expansion completed. This is the “support” Alberta is asking for, and it is the action from the Federal Government that Canada needs.

A consistent, fair and non-burdensome regulatory system is the backbone of a strong economy. Without a regulatory system that can get major projects approved to move our energy to tidewater, we will continue to lose approximately $80 million a day.

This endangers the competitiveness of our economy and means fewer resources for essential public services or the commercialization of clean technologies. Without a regulatory system free from layered, duplicative standards and regulations, the cumulative costs will make climate policies too expensive for Canadian businesses. A regulatory system that is predictable, transparent, and free of needless cumulative costs, comes first. Doing it in the reverse is putting the cart before the horse.

The Canadian Chamber will continue advocacy work on Bill C-69 to make sure major projects and foreign investment in this country are supported by a regulatory system that is predictable, clear and objective in its assessments.

This also means making it clear to decision-makers that they must take action to reduce the cumulative costs businesses face so that carbon pricing does not become layered with other additional costs and regulatory standards.

Keep an eye out for our latest report, The Cumulative Cost of Climate Policy, which will make key recommendations on how to achieve meaningful climate action at the lowest possible cost to Canadian businesses.

The above commentary comes from the Canadian Chamber of Commerce. The Sarnia Lambton Chamber of Commerce is a member.

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