Smaller companies worry they can’t pass carbon tax costs to customers: poll

Ottawa says 90 per cent of the carbon-tax revenues it collects will be returned via rebates

A large proportion of small- and medium-sized businesses soon to be subjected to Ottawa’s carbon tax worry they’ll be unable to pass along the bulk of the extra costs to their customers, suggests a new survey being released Tuesday.

The online survey was completed by 3,527 members of the Canadian Federation of Independent Business in the four provinces — Saskatchewan, Manitoba, Ontario and New Brunswick — that will have to follow the Trudeau government’s carbon-pricing system as of April 1.

The lobby group has strongly opposed the federal carbon-tax plan out of concern it will pile on too many costs for smaller companies. In fact, more than two-thirds of the business owners that it polled don’t support any kind of carbon pricing program at all.

Ottawa says 90 per cent of the carbon-tax revenues it collects will be returned via rebates to households in each of the four provinces. Consumers will get by far the largest share because the government expects them to ultimately pay most of the new costs passed down from businesses.

But the findings of CFIB’s poll, conducted in November, suggest there’s concern most smaller companies will be unable to pass along their new costs — meaning these firms will end up subsidizing the rebate program for households, the report said.

About 80 per cent of the respondents said they didn’t think it would be easy for them to forward costs on to their customers. The poll found 55 per cent of those surveyed didn’t expect to pass on any of the additional costs, while 25 per cent said they would only be able to pass on less than 25 per cent of the extra costs.

“These findings should be deeply worrisome to public policy makers,” said the report, which also repeats CFIB’s concerns the carbon tax will arrive the same year that businesses’ Canada Pension Plan premiums start to rise.

“It means small firms will be forced to find the resources to pay the tax from the business itself, which means it may come at the expense of wages, jobs or future business growth.”

The Liberals’ carbon tax has generated intense political debate across the country and it’s destined to be a key campaign issue in October’s federal election.

The Liberal government has argued pollution is already getting expensive for Canadians as costs from climate-change-related weather events have climbed to more than $1 billion a year. The Liberals believe carbon pricing, which has been in place for years in provinces like British Columbia, Quebec and Ontario, is one of the best ways to lower emissions.

The federal climate change action plan also includes efforts to develop clean fuel standards, create new energy-efficiency building codes and phase out electricity generation from coal.

The opposition Conservatives have repeatedly called the Liberal plan a “tax grab” that will hurt the bottom lines of small businesses and families, kill jobs and make the country less competitive. Moving forward, the Tories warn carbon-tax bills will only get bigger.

Several provincial leaders have also become vocal opponents of the federal program.

The regime will be applied to Saskatchewan, Manitoba, Ontario and New Brunswick because they don’t have their own carbon-pricing system.

READ MORE: Saskatchewan, Ottawa carbon tax case ‘monumental’ for Constitution

READ MORE: Federal government’s carbon pricing could determine election results

Ottawa has said the remaining 10 per cent revenue share from the carbon tax will be dedicated to a program to help organizations, such as schools, that are unable to pass on the costs via higher prices. Part of this portion — worth about $1.5 billion — will also be used to help small- and medium-sized businesses adapt to carbon pricing over the next five years, the government has said.

Ottawa has yet to lay out the specifics of this element of its plan.

The report noted that some big industrial emitters will pay through a separate system that provides some relief to sectors heavily exposed to foreign competition. Smaller businesses, it added, have not been provided the same relief.

CFIB is calling on Ottawa to limit the impact on smaller businesses, including reassurance the same proportion of revenue collected from these firms is returned to them.

Andy Blatchford, The Canadian Press


Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Pickleballers hit the courts after City lifts COVID-19 restrictions

Patrons must follow specific health and safety guidelines

MS Walk goes virtual due to COVID-19

The annual walk to raise awareness of multiple sclerosis goes online, in #WeChallengeMS initiative

First annual Forest Service Road Clean Up For Wildlife goes until May 31

Taking place from May 16-31, the contest is open for anyone to enter

LIVE: Procession to honour Snowbirds Capt. Jennifer Casey comes to Halifax

Snowbirds service member died in a crash in Kamloops one week ago

Bike shops busier than ever, but owners worry about stock supply issues

Uptick in cyclists brings new challenges for shops

RCMP facing ‘systemic sustainability challenges’ due to provincial policing role

Provinces, territories and municipalities pay anywhere from 70 to 90 per cent of the cost of the RCMP’s services

One man dead after standoff with Chilliwack RCMP

The Independent Investigations Office of B.C. is investigating the RCMP’s role in the death

B.C. employers worry about safety, cash flow, second wave in COVID-19 restart

A survey found 75 per cent of businesses worry about attracting customers

Ex-BC Greens leader Andrew Weaver says province came close to early election

Disagreement centred on the LNG Canada project in northern B.C.

Canada’s NHL teams offer options to season-ticket holders

Canadian teams are offering refunds, but also are pushing a number of incentives to let them keep the money

B.C. premier says lessons to learn from past racism during response to pandemic

B.C. formally apologized in the legislature chamber in 2008 for its role in the Komagata Maru tragedy

Snowbirds to remain at Kamloops Airport indefinitely after fatal crash

small contingent of the Snowbirds team is staying in Kamloops, acting as stewards of the jets

Most Read