CFIB asking for stronger regulatory accountability and tax relief ahead of opening of the House of Assembly
With the House of Assembly scheduled to open on March 2, the Canadian Federation of Independent Business (CFIB) is calling on the province to make the spring sitting a turning point for small business competitiveness and economic growth.
“This spring sitting is an opportunity for government to show that it is serious about creating a more competitive and entrepreneur-friendly Newfoundland and Labrador,” said Jonathan Galgay, Director of Legislative Affairs, Newfoundland and Labrador. “Small businesses have carried significant cost pressures, and they are looking for clear signals that government is ready to act.”
A key priority for CFIB is the reinstatement and strengthening of the Regulatory Accountability and Reporting Act, which expired under the previous government. The Act represents one of the most important tools available to ensure transparency and accountability. As of 2024, the total cost of regulation for Canadian businesses reached $51.5 billion annually, with $17.9 billion – about 35% -attributed to red tape across the country. Businesses spent an estimated 768 million hours on compliance, equivalent to nearly 394,000 full-time jobs. The smallest firms bear the greatest burden, paying up to five times more per employee than larger businesses.
“The Act must return stronger than before, backed by clear accountability, annual reporting, and leadership at the ministerial level,” added Galgay. “With the right framework, Newfoundland and Labrador can move from years of failing grades on CFIB’s Red Tape Report Card to becoming a national leader in regulatory modernization.”
CFIB is also urging the government to deliver on its commitments made during the 2025 provincial election including its pledge to reduce the small business tax rate from 2.5% to 1% in 2026. With 67% of small business owners in Newfoundland and Labrador identifying tax and regulatory costs as a major barrier to growth, meaningful action is required in this session.
For this first session of the new government in the Legislature, CFIB recommends:
- Reinstating and strengthen the Regulatory Accountability and Reporting Act, including the removal of the sunset clause.
- Lowering the small business tax rate from 2.5% to 1% and increasing the threshold from $500,000 to $700,000 for the 2026 tax year.
- Eliminating the 15% retail sales tax on insurance.
- Eliminating internal trade barriers by adopting mutual recognition legislation.
- Amending the Towns and Local Service Districts Act and Cities Act to allow municipalities to compensate small businesses affected by public works projects.
- Adopting a growth-focused agenda, prioritizing policies that reduce costs, improve service delivery, and support job creation.
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