The Canadian Federation of Independent Business (CFIB) says it is pleased that the federal budget confirms a deal to lower credit card fees for small merchants, as promised in last fall’s economic statement, but the budget was a missed opportunity to provide relief to small businesses facing massive debt loads and cost increases.
“The biggest win in the 2023 budget is the deal reached with Visa and Mastercard to reduce credit card fees for small business owners,” said Dan Kelly, CFIB president. “A 27 per cent reduction in small business merchant fees is significant, but more details are needed to determine how many small businesses will benefit from this plan.”

Kelly said the national organization was however disappointed by the lack of meaningful debt relief for small businesses in the budget, when more than half are still carrying pandemic-related debt at an average of $105,000.
“An extension to the Canada Emergency Business Account (CEBA) loan repayment deadline of December 31, 2023, is desperately needed and will be a major priority for CFIB in the weeks ahead,” he said.
The CFIB said it was also disappointed that the government continues to project deficits for the foreseeable future resulting in increasing debt charges that will reach $50 billion by 2027-2028.
“Bringing the budget back to balance remains a priority for small business owners,” said Kelly.
The federal government’s full budget can be viewed here.

The Retail Council of Canada said the Federal Budget contains a number of initiatives to address affordability challenges facing Canadian families, but it feels the government missed the mark by not including two key proposals from the Council that could have made life more affordable for Canadian families by saving them up to $1,000 per year on average.
“Specifically, slashing interchange rates for credit card acceptance could have saved Canadian families up to $600 yearly and the elimination or suspension of customs duties could have saved Canadian families a further $400 a year. Together, these unjustifiable charges cost Canadians a whopping $16 Billion annually,” said the Council in a statement.
“Canadians pay among the highest “swipe fees” in the world. It’s a reverse-Robin Hood problem – consumers with modest incomes subsidize prices for wealthier consumers who use premium and super premium cards. As well, growth in credit card sales have vastly outstripped (almost doubled) the growth in sales of the underlying goods at retail. Since credit is vastly more expensive for businesses to accept than debit or cash, the interchange growth on credit card sales has an inflationary impact. If the government cared about the inflationary and regressive $10 billion annual costs faced by Canadian consumers, it would have lowered interchange rates across the board in today’s Budget so that people see the savings wherever they choose to shop.
“Similarly, many people don’t realize that Canadians pay up to 20 per cent more for clothing, shoes, and baby items such as car seats, strollers, and diapers. Overall, these hidden taxes on consumer goods place a $6 Billion burden on Canadian families or $400 for each household. These tariffs were implemented long ago to protect textile and clothing manufacturers in Canada who have long since moved most production to overseas jurisdictions.”
The Council said it was also disappointed to not see adopted the creation of a Visitor Rebate which would have given tourists a tax rebate on goods they buy while in Canada – a huge opportunity for the Canadian economy.
“Similar programs in Japan and the Bahamas have seen growth in tourist spending of over 23 per cent and 19 per cent,” said the Council.
“Finally, with regards to today’s rebranding of the GST rebate system to help Canadians with the rising cost of food, we would point out that most groceries aren’t subject to sales tax to begin with. That said, we agree that delivering regular payments to Canadians on an income-tested basis is helpful during these challenging times.”

The Canadian Taxpayers Federation criticized the budget for raising taxes and running deficits indefinitely
“This budget is giving taxpayers big deficits, more money wasted on interest charges and higher taxes,” said Franco Terrazzano, Federal Director of the CTF. “This government doesn’t care about fiscal prudence or helping taxpayers.”

The deficit is expected to reach $40 billion in 2023, which is almost $10 billion higher than forecasted in the fiscal update. There is no plan to balance the budget. The government overspent its own 2022 budget by $18 billion, said the Federation.
On April 1, the government is increasing the carbon tax to 14 cents per litre of gasoline and 12 cents per cubic metre of natural gas. Federal alcohol taxes will also increase by two per cent. Budget 2023 includes a tax on share buybacks, taxation on dividends received by financial institutions, higher taxes on top earners and intergenerational business transfers.
While the government is providing some one-time GST rebates, there are no broad-based tax cuts.
“Giving a few families back some of their GST money back is really just an admission there’s a problem without looking for a serious solution,” said Terrazzano. “Taxpayers need real tax relief.”
The CFIB said Employment Insurance (EI) premiums are not projected to increase for the next seven years. Following many years of Canada Pension Plan (CPP) premium hikes and the January 1, 2023, increase in EI, stable EI premiums would help small business facing many other rising costs of doing business. CFIB is pleased there were no significant new costly benefits added to the EI system in the budget, it said.
“While CFIB is pleased that the government is capping the hike in excise duties on beer, spirits and wine at two per cent for 2023, we will continue to press government to end these automatic tax increases. Sadly, the government missed another opportunity to freeze the upcoming carbon tax hike on April 1, putting further cost pressures on small firms,” said Kelly.
Here’s the CFIB comments on some other budget items:
• Employee Ownership Trusts: CFIB is pleased to see proposed new measures to facilitate the transfer of businesses to their employees. This is an important measure as 70% of small business owners are looking to exit their firms in the next decade.
• Intergenerational Transfers: New measures surrounding Bill C-208 hold significant implications for small business owners and require detailed review to ensure they are practical and respect the spirit of the Private Members’ Bill. CFIB will be studying the proposed amendments carefully but is pleased the government will only apply them starting January 1, 2024.
• Internal Trade: The budget commits to reduce internal trade barriers through a Federal Action Plan which includes funding to help identify barriers to trade and explore ways to eliminate them.
• Tradespeople Tool Deduction: It is good news that this deduction will double from $500 to $1,000, allowing tradespeople who provide their own tools as part of their employment to cover rising costs.
Restaurants Canada said it was pleased to see some positive measures in the 2023 federal budget to support Canada’s foodservice sector. The budget addressed the federal alcohol excise duty, which will now only increase to two per cent on April 1, rather than the initially planned 6.3 per cent. The federal government also highlighted an agreement with major credit card companies to reduce interchange fees, a big win for our sector, as it leaves more dollars in the hands of business owners – we look forward to more details to come on this initiative.
“The Canadian Government also took Restaurants Canada’s recommendations to invest in the hospitality and tourism industry through its Canadian Tourism Growth Strategy, which has the potential to bring back economic benefits to our sector,” said the organization.
“Though today’s announcement brought some positives, the government missed an opportunity to implement sector-specific support for the restaurant industry, which was the hardest hit by the pandemic, it said.

“By leaving several of our recommendations on the table, such as extending the CEBA loans by 36 months and implementing a scale-down model on the forgivable portion, as we proposed in our Federal Pre-Budget Submission 2023, the Canadian Government missed the opportunity to save struggling small businesses from an uncertain fate,” said, Olivier Bourbeau, Vice President of Federal & Québec Affairs. “In a recent Restaurants Canada survey, we found nearly 20 per cent of the restaurants that have yet to reimburse CEBA will not be able to repay it in part or at all.”
Restaurants Canada also said: “Despite effective measures proposed by Restaurants Canada to address the foodservice sector’s labour shortage, the budget also failed to improve and streamline the Temporary Foreign Worker (TFW) program by;
- Implementing the Trusted Employers’ Program;
- Simplifying the TFWP application process, lowering fees and addressing the backlog;
- Creating a dedicated food service stream (for TFWs); and
- Remodeling the NOC codes (classification C and D): regrouping positions from the same field/expertise, providing more flexibility and training/promoting opportunities.”
The Canadian Chamber of Commerce said the 2023 federal budget was a chance to establish the right policy framework that builds this economy by encouraging investment and commerce.
“Today was an opportunity to lay out a clear plan for growth. While there are some positives, we still lack a coordinated strategy to generate that economic growth over the long term,” said Perrin Beatty, President and CEO of the Canadian Chamber of Commerce.

“Businesses across the country are feeling the impact of anemic growth coupled with labour shortages and rising costs for doing business. For future generations to enjoy the opportunities and prosperity we have been so fortunate to inherit, we must unleash the potential of private industry by building a 21st Century workforce, investing in trade-enabling infrastructure and fixing our broken regulatory system.
In the aftermath of the pandemic, our international competitors continue to outpace us as Canada experiences extremely low growth. And achieving competitive levels of economic growth, a clean climate, and equal opportunity for all Canadians aren’t mutually exclusive, but mutually dependent. To achieve these goals we need government to eliminate the disincentives that drive away investment and focus on pro-business policies for the benefit of all Canadians, said the Chamber.
With over 800,000 job vacancies in Canada at this time, the Canadian Chamber of Commerce was also hoping to see the budget focus more sharply on the skills and talent our workforce will need now and into the future.
“Our country cannot borrow its way to prosperity,” said Beatty. “Canada needs policies, strategic investments and federal leadership that will spur economic growth. Canada’s businesses are anxious to do their part, but the federal government needs to see them as partners, not problems, in building a more successful Canada.”