The City of Winnipeg is working on its budget for 2021 and is proposing to raise the threshold for the tax credit on small businesses.
In the preliminary 2021 Balanced Budget Update, the city says raising the threshold on the Small Business Tax Credit would eliminate the Small Business Tax for almost 1,000 more businesses.
It has been proposed to raise the threshold from $35,700 to $44,200. The city says this would save small businesses an average of about $2,000.
Mayor Brian Bowman says Winnipeg's small business community has taken a significant financial hit during the COVID-19 pandemic.
"The city took action to defer taxes for residents and businesses facing financial difficulty as a result of the provincial public health restrictions, and exempting nearly one thousand more businesses from paying the business tax is another way the city can help today and long after the pandemic concludes," he says.
The new measures would allow for around 55 per cent of all businesses to receive a full credit of their business taxes in 2021. The business tax rate would also remain frozen throughout the next year at 4.84 per cent.
The newly proposed measures would further the efforts taken by the city during the pandemic to help ease the financial hardships experienced by businesses over the past nearly nine months.
A temporary patio permitting program and one-hour complimentary parking at all metered locations in Winnipeg are other ways the city has offered support to Winnipeggers during the pandemic.
"Many small businesses have been hurt by COVID-19 restrictions and need financial relief," says Scott Gillingham, chairman of the Standing Policy Committee on Finance.
Gillingham says the city is trying to work within its resources and framework for a balanced budget to assist the small business sector through this time.
Some local businesses have already responded to the new proposed support measures.
"Every bit of support for small businesses helps right now," says Kate Fenske, Downtown Winnipeg Biz CEO.
"We know businesses across our city, especially downtown, are struggling and financial support like the City’s proposed Economic Support Grant provides local business owners with much needed cash so they can remain in business during the second wave of COVID-19."
Kevin Chief, founder of the Winnipeg Aboriginal Sport Achievement Centre, says the support builds on their centre's 20-year relationship with the city.
"We are thankful for this investment into recreation at the Old Ex arena that will help the WASAC to continue our focus on removing barriers and creating opportunities for children, youth and families in our community," he says.
Schwarma Khan owner Obby Khan says the extra money will help him to support his staff, buy equipment, and sustain his business.
"Raising the Small Business Tax threshold is a great idea, and for a small business like mine, the extra money not going to taxes makes a huge difference on my operations."