The Federal government has announced new measures to support small- and medium-sized businesses (SMBs), including a $2.5 billion Canada Carbon Rebate and reduced credit card transaction fees.
Deputy Prime Minister and Minister of Finance Chrystia Freeland, Minister of Small Business Rechie Valdez, and Minister of Public Services Jean-Yves Duclos announced these measures, which are designed to address the financial pressures SMBs face and provide relief in key areas such as fuel costs and credit card fees.
The Canada Carbon Rebate for Small Businesses will provide over $2.5 billion to approximately 600,000 businesses by the end of the year. This rebate is a refundable tax credit that returns a portion of the federal fuel charge proceeds from 2019 to 2024 to eligible businesses. Companies that filed their 2023 tax returns by the deadline in July can expect to receive payments by December. The rebate amounts vary by region, with businesses in Ontario, Alberta, Saskatchewan, and other provinces receiving different amounts based on the size of the business and the region’s fuel charges.
The Canadian Federation of Independent Business (CFIB) welcomed the announcement. "CFIB is relieved to learn the federal government will return the $2.5 billion small business share of carbon tax revenue that has been stuck in Ottawa for the past five years," said Dan Kelly, CFIB president. "It's good news that this money will be returned to small businesses by direct deposit or cheque before the end of the year.
The government has also proposed extending the tax return filing deadline to December 31. Pending legislative approval, late filers will receive their rebates at a later date.
Additionally, the government introduced a revised Code of Conduct for the Payment Card Industry, which aims to protect more than one million businesses that accept credit and debit card payments. The updated code, effective October 30, is expected to improve transparency by allowing businesses to compare pricing from different payment processors more easily. The revisions also shorten the complaint handling time from 100 business days to 20.
Starting October 19, reduced credit card transaction fees will take effect. The fee reductions, negotiated with Visa and Mastercard, are expected to save SMBs up to $1 billion over the next five years, with fee cuts of up to 27 percent.
“By reducing the cost of accepting credit card payments, and returning more money to small businesses, Canadian entrepreneurs will be able to put more of their money towards growing their business and creating good-paying jobs,” said Minister Freeland. Minister Valdez echoed this sentiment, highlighting that the new measures will provide tangible support to small business owners, who are essential to the strength of local economies.