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January 1 CPP hikes to hit employers' payroll budgets, cut take-home wages for workers; CPP premiums to rise by up to 9.3 per cent in 2021 Publication info: Grizzly Gazette ; Swan Hills, Alta. [Swan Hills, Alta]. 24 Nov 2020: A.4.

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FULL TEXT With one in three small businesses losing money every day they are open due to COVID-19, things are about to get

even worse with an upcoming hike in Canada Pension Plan (CPP) premiums scheduled for January 1, 2021, warns

the Canadian Federation of Independent Business (CFIB). In fact, more than 70 per cent of small businesses say

government should not increase payroll taxes, like CPP, as part of their economic recovery plan.

"Payroll tax increases are bad news for small businesses in any year, but hiking them in 2021 will make the tough

months ahead even harder," said CFIB President Dan Kelly. "Let's not forget that the premium hike hits employees

too, ensuring that every working Canadian will see a drop in their take-home income unless their employer is able

to give them a larger raise on January 1."

As part of a seven year plan to raise CPP premiums in order to provide for greater CPP benefits decades from now,

CPP premium rates for all workers are to rise by 3.8 per cent in 2021. The amount of income subject to premiums

is also rising by 5.3 per cent. This means for workers earning $60,000 or more, both the employer and employee

will see more than a 9 per cent increase in their CPP premiums.

One major concern heading into 2021 is that the planned CPP hike will decrease businesses'ability to hire staff.

Currently, only 42 per cent of businesses are fully staffed. Payroll taxes are more burdensome on small businesses

as they tend to be more labour intensive. They also have to be paid regardless of whether the business is profitable

or not, which will be an additional blow to firms that end 2020 in debt.

CFIB sent a letter urging the federal government to hold taxes, such as CPP/QPP and the federal carbon tax, at

current levels to allow small businesses to get back on their feet before their costs go up.

"Given the difficult situation many smaller firms are facing simply trying to hold on to their staff, now is not the

time to raise taxes," concluded Kelly. "Small firms are counting on the federal and provincial governments to put a

temporary freeze on this harmful plan." DETAILS

Subject: Small business; Employers; Payroll taxes; Tax increases

Business indexing term: Subject: Small business Employers Payroll taxes Tax increases

Identifier / keyword: three small businesses losing money things

Publication title: Grizzly Gazette; Swan Hills, Alta.

First page: A.4

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Publication year: 2020

Publication date: Nov 24, 2020

Section: News

Publisher: Postmedia Network Inc.

Place of publication: Swan Hills, Alta.

Country of publication: Canada, Swan Hills, Alta.

Publication subject: General Interest Periodicals--Canada

ISSN: 02296772

Source type: Newspaper

Language of publication: English

Document type: News

ProQuest document ID: 2464744188

Document URL: http://ra.ocls.ca/ra/login.aspx?inst=centennial &url=https://www.proquest.com

/newspapers/january-1-cpp-hikes-hit-employers-payroll-

budgets/docview/2464744188/se-2?accountid=39331

Copyright: Copyright Alberta Weekly Newspapers Association Nov 24, 2020

Last updated: 2020-11-28

Database: ProQuest Central