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Impact of U.S. Tariffs on Canadian Small Businesses: A Call to Action

Overview of the Situation

TORONTO, January 15, 2025 /CNW/ – Recent developments have revealed that a proposed 25% tariff on Canadian products by the United States, accompanied by potential retaliatory tariffs from Canada, poses a significant threat to small businesses in Canada. The Canadian Federation of Independent Business (CFIB) has issued a stark warning, indicating that approximately two-thirds (65%) of small business owners are likely to raise prices for consumers in an effort to mitigate the financial burden of these tariffs.

Furthermore, it’s important to note that 69% of small business owners feel this tariff imposition will result in heightened operational costs. This is alarming news not only for business owners but also for consumers who will ultimately bear the financial burden of increased prices.

Voices of Concern from CFIB

Chorine Pohlmann, Executive Vice-President of Advocacy at CFIB, expressed the grave implications of a potential trade war. "A trade war would be disastrous for both Canadian small businesses and consumers. We need to ensure that as governments face the tariff threat with their American counterparts, they must also stay focused on keeping Canadian businesses competitive at home," she stated. Her message underscores the urgent need for government intervention to protect the interests of small businesses.

Pohlmann further explained, "The solution is a no-brainer. This is an SOS call to all governments: reduce red tape, eliminate internal trade barriers, and ease the tax burden on small businesses." By simplifying regulations and providing fiscal relief, governments can help small businesses remain nimble and competitive.

The Scope of the Problem

Recent CFIB data revealed that an overwhelming 82% of businesses will be affected by tariffs in some capacity. The United States stands as Canada’s largest trading partner, with over half (51%) of small businesses engaged in importing from or exporting to the U.S. This statistic doesn’t even account for the thousands of businesses that depend on suppliers and customers engaged in cross-border trade.

Businesses predict potential challenges, including limited inventory, reduced product availability, and the urgent necessity to identify alternative markets or sources of supply if these tariffs come into effect.

Recommendations from CFIB to Government

In response to these pressing issues, CFIB took proactive measures by communicating with all provincial premiers, sharing their deep concerns regarding the tariff threat. They provided key recommendations aimed at alleviating the adverse effects of potential tariffs on Canadian goods. Notably, a significant majority (62%) of business owners believe that Canadian governments need to take immediate steps to reduce their tax burdens. Additionally, an equal percentage of business owners advocate for the enhancement of border security measures to adequately address the concerns of U.S. authorities.

A Call for Bold Action

Pohlmann articulated a frustrated sentiment, stating, "It’s ridiculous that it’s still easier for Canadian small firms to do business overseas or across the border than within their own country." She underscored the necessity for government action to support small businesses, enabling them to enhance productivity and competitiveness in the face of looming tariff threats.

Methodology of the Survey

To gather these insights, CFIB conducted a comprehensive survey titled "Your Voice – December 2024." The survey, which took place from December 5 to December 29, 2024, involved 1,898 CFIB members as respondents. For comparison purposes, a probability sample with the same number of respondents would possess a maximum margin of error of ±2.25%, 19 times out of 20.

About CFIB

The Canadian Federation of Independent Business (CFIB) represents Canada’s largest association of small and medium-sized enterprises, boasting 100,000 members from every industry and region across the country. CFIB is committed to enhancing the chances of success for business owners by advocating for policy change at all levels of government, as well as providing expert guidance and resources.

For more information about CFIB and its initiatives, visit cfib.ca.

How AI legalese decoder Can Assist Small Businesses

In today’s complex legal environment, the ramifications of tariff policies can create significant confusion for small business owners. The AI legalese decoder is an invaluable tool that simplifies legal language and documents, making them accessible and comprehensible for everyone. By using AI legalese decoder, business owners can better understand the implications of new tariffs and regulations, ensuring they are well-informed and prepared for potential challenges. With its ability to decode intricate legal terms, AI legalese decoder empowers small businesses to navigate these obstacles with confidence, allowing them to focus on growth and competitiveness in a challenging market.

For media inquiries or interviews, please contact: Dariya Baiguzhiyeva, CFIB, at 647-464-2814, or via email at [email protected].

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