By Daniel Smith
The new Conservative government’s campaign promise to cut consumer and business taxes has local entrepreneurs guardedly optimistic — glad for any break, but unsure if the cut will really materialize.
“I’m not wrestling with the concept of a tax break,” says Ken Ginn, with a smile. “Anything’s a help, really, especially in the local economy.” Ginn is the owner of Bank Street camera shop Ginn Photographic.
The Conservative tax plan is three-pronged, says Pierre Poilievre, Conservative MP for Nepean-Carleton. “We are going to cut the GST from six to five per cent, reduce the tax rate of small to medium – sized businesses from 12 to 11 per cent and raise the threshold under which small businesses pay the lowest rate,” he says.
Currently, that threshold is set at $300,000 in annual revenue. The Tories promised to expand this lowest tax bracket to include business doing up to $400,000 worth of business.
Ginn says the tax cuts will really help his bottom line.
“We make a very minor profit as it is, so if we can pay less taxes at the end of the day, all the better.”
Josef Skurek, owner of the Bank Street Sausage and Deli, says he is looking forward to the tax break as well.
“(The Conservatives) have promised a tax cut and like any other business, I think smaller taxes are better for everyone.”
Ginn says taxes make up 15 to 20 per cent of his own costs. “That’s a huge percentage that (the government) gets right away and we have to do without.”
And that percentage is only what Ginn calls “hidden” taxes. It doesn’t include the GST, which he says also affects his business. “Taxes are a large part of people’s buying decisions. People prioritize purchases and they really scrutinize the price and the taxes.”
But while the tax cuts would be a welcome savings for local businesses, Ginn worries that may not happen. “I know they have promised this,” he says, “but it’ll be interesting how far along in their agenda this will be.”
Poilievre says Ginn should not be concerned, because this promise is central to the Conservative philosophy itself. “We believe that every day, people are better at spending their money than the government is,” he says, “and we trust small businesses to do right by their money.”
“This is definitely a priority for us and it is costed into our plan,” says Poilievre. “There is a budget coming up in the spring, and that budget will include tax cuts.”