More than half of BC businesses are still in pandemic debt
Business bankruptcies in British Columbia are on the rise.
That’s according to the Canadian Federation of Independent Business (CFIB).
Jairo Yunis, senior provincial policy analyst, said Vista Radio rising operating costs coupled with a lack of demand and rising interest rates are pushing more businesses to the brink.
“17% of small businesses are actively considering filing for bankruptcy or ending their business. Only a few business owners would use the bankruptcy mechanism if they closed their doors permanently.
Yunis added that more entrepreneurs than ever before are facing a difficult climb just to stay afloat.
“90% of them struggle to meet the cost of gas, insurance and inputs, while 85% of them struggle to meet government costs such as higher payroll taxes and WorkSafeBC bonuses. »
Recent data shows that more than half (51%) of business owners in British Columbia have yet to return to normal pre-pandemic levels, while 56% of businesses in the province are still in debt in pandemic case.
“British Columbia’s average debt is very high compared to other provinces. The average small business in BC took out almost $200,000 in loans,” Yunis said.
Also, while entrepreneurs are doing all they can to keep the doors open, Yunis said they can’t do it alone.
CFIB said the provincial government has the tools to help small businesses further by refunding the $3.4 billion WorkSafeBC surplus and providing school tax relief.
“British Columbia businesses are very resilient. They want to resort to the last mechanism they can use to stay afloat, but they are also waiting for the government to step in and ensure that the efforts of the past two years are not wasted.
CFIB urges the federal government to help keep small businesses viable and reduce their operating costs.
- Increase the repayable portion of the Canada Emergency Business Account (CEBA) loan to at least 50%
- Extend the repayment period for CEBA loans to benefit from a partial loan forgiveness until December 2024
- Small business deduction increased to $600,000 (currently $500,000)
- Freeze planned federal tax increases, including the 2022 increase in CPP, EI, carbon and alcohol taxes, and reduce the burden of provincial payroll taxes
- Immediately implement the promised reduction in credit card fees for small merchants