Ontario must re -prepare its programs to support auto businesses through tariffs and related economic uncertainty, because the way they are currently structured, they are leaving small businesses in Lurch, a advocacy group says in a new report.
The Canadian Federation of Independent Business on Wednesday released a report on the basis of a survey of 187 small-to-medium-sized businesses in the automotive sector, which from suppliers to repairing shops, and found that tariffs are already making an impact.
The report stated that their revenue has declined by an average of 13 per cent, and half of them stated that they have stopped or canceled investment due to uncertainty due to the Canada-US trade war, causing billions in lost revenue or missed investments.
Joseph Falzta, co-writer of the report with CFIB Ontario, said, “It is impossible for a business owner to know what is happening these days.”
“I do it as my full -time job, and it is always difficult for yourself. So you can only imagine the owner of a business that is working 50, 60 hours a week, trying to keep an eye on things.”
Faljata said their revenue is paying high prices as they are paying high prices and the confusion about which products are affected by tariffs, as well as due to costs related to searching for new supply chains, Phalzata said.
The CFIB report states that Ontario has programs to help shore businesses in the automotive sector, but when appreciated, when they talk of supporting small businesses, they are missing the mark.
In its spring budget, the provincial government stated that it was putting $ 85 million in two programs: Ontario Automobile Modernization Program to help suppliers upgrade equipment and Ontario to help research and development for vehicle innovation networks.
“Although these programs have been designed with good intentions, some small businesses plan to use them, and one of them is more disqualified,” CFIB reports.
“Programs focus on R&D innovation and large -scale construction, while the reality disregards that most motor vehicles (small and medium businesses) may not be involved in these processes.”
A new $ 50 million Ontario Trade Fund means that businesses require at least 30 percent revenue loss and require to help businesses to find domestic supply chains, and they need to insert $ 200,000 of their own capital, which the report “a luxury (small and medium business) cannot be called.
The government said that its programs have already helped hundreds of businesses, Ontario Vehicle Innovation Network has supported more than 600 small and medium businesses since its inception in 2019 and Ontario Automotive Modernization Program has supported 215 projects since 2021.
Jennifer Qunalif, a spokesman for Economic Development Minister Vik Fedeli, wrote in a statement, “In front of unprecedented global economic uncertainty, our government is protecting and building progress made to make small businesses champions in the auto sector and in the economy.”
CFIB said that the best way to help small businesses would be to reduce the small trade tax rate to reduce the rate of 3.2 percent. The government reduced the rate by 3.5 percent in 2020.
