Canada Needs a Small Business-Friendly Investment Strategy

The backbone of Canada's economy are small businesses, which employ 5.8 million people and generate 33.2% of private-sector GDP. However, they often struggle to access incentives and funding due to their size and industry type.

Currently, the federal government offers a Productivity Mega Deduction (PMD) that allows businesses to immediately write off the full cost of about 65% of capital assets. But this deduction is worth less to small corporations paying between 9-12% tax compared to large ones paying more.

Tim Cestnick, an author and CEO of Our Family Office Inc., suggests introducing tax measures that benefit small businesses, such as deferring tax on reinvestment, rewarding risk with a tax credit for arm's-length investors, competing with the US by raising the lifetime capital-gains exemption, updating the small-business limit, keeping businesses Canadian at sale time, and offering a tax holiday.