Toronto, ON — August 28, 2025 — The Better Way Alliance (BWA), a national voice for smarter local business policy, is pleased to submit its recommendations to the Canadian government as part of its official 2025 Pre-Budget Consultations focused on building a stronger economy for Canadian small & medium sized employers (SMEs) and everyday Canadian workers.
The Better Way Alliance (BWA), a network of employers offering Good Jobs to local workers across Canada, agrees that this is a critical moment for the federal government to rapidly unlock stable SME business growth through efficient policies and market-based concepts – and nimbly adapt Canada’s trade and economy in a quickly shifting environment.
The BWA is composed of business leaders across multiple industries – employers that invest above minimum employment standards in all sectors – proving that SMEs are a source of economic resilience and inclusive community growth in Canada.
From new immigrants to Indigenous communities and everyone in between – Canada is a country of bold entrepreneurs. But over 2024, the number of active businesses shrank or was stagnant, every single month. Simply put – the fundamental costs of opening and operating a business have become a major obstacle, if not prohibitive.
We understand the recently elected Canadian government seeks to boost investment and catalyze economic growth. We know through experience that, done right, this benefits business owners, our labour force, and Canada’s national economic security at the same time by:
- Keeping citizens secure with good jobs
- Boosting business starts and improving stability for experienced local entrepreneurs
- Developing strong economic communities from urban to rural across Canada
Better Way businesses help build resilient communities that respond to tariff threats and global economic uncertainty through strong community fabric. But there’s more we can do at home to ensure Canada’s next generation of entrepreneurs have more tools at their fingertips to succeed.
Our recommendations are as follows:
1. Reduce barriers to SME productivity & growth by optimizing the Canada Small Business Financing Program
2. Introduce a Good Wages Tax Credit to Boost Workforce Stability and Productivity in Low-Wage Sectors
3. Create Smart Tax Incentives to Protect Local Jobs on Local Main Streets
4. Stimulate Insurance Market Competition as a Means to Stabilize Rising Business Costs within SMEs
Recommendation 1: Reduce barriers to SME productivity & growth by optimizing the Canada Small Business Financing Program
Barrier:
Canada is facing twin crises that threaten small business viability. First, commercial property costs have far outpaced Canada Small Business Financing Program (CSBFP) financing limits: viable retail properties now surpass $1M in many major and mid-sized markets. Second, 76% of business owners plan to retire in the next decade with business assets worth over $2 trillion at stake, yet fewer than 10% have formal succession plans and current CSBFP terms don’t support business acquisition. Without intervention, these trends will result in widespread business closures and job losses across Canadian communities.
Business owners that want to invest in growth and productivity are stifled by rising rent prices and unsuitable access to capital. The CSBFP is designed to support business investments in productivity and long-term growth, but in reality is leaving out several easily achievable opportunities – while leaving businesses under significant financial strain.
Policy Recommendation:
Increase the maximum CSBFP loan to $5M – enabling property ownership and business acquisition financing that reflects current market conditions while facilitating the largest generational wealth transfer in Canadian history. Read our in-depth recommendations including new limits and eligibility allowances here.
Recommendation 2: Introduce a Good Wages Tax Credit to Boost Workforce Stability and Productivity in Low-Wage Sectors
Barrier:
Rising rents, supply chain disruptions, and tariff volatility are squeezing businesses across the country. Many SME employers want to offer competitive wages but face tough choices between investing in their workforce and keeping their doors open.
Policy Recommendation:
Create a Good Wages Tax Credit that gives businesses the financial flexibility to invest in the workforce strategies that drive long-term success, even when short-term pressures are intense.
The Good Wages Tax Credit offers businesses the breathing room to implement what they already know works in traditionally low-wage sectors (e.g. retail, foodservice, tourism). By offsetting part of the cost when employers pay above minimum wage toward Living Wage levels, the tax credit would help stabilize workforces during uncertain times.
All eligible employers could benefit from this tax credit, regardless of when they began offering higher wages. Unlike training subsidies or student wage programs, this credit would support all workers in traditionally low-wage sectors. It would allow businesses to hire from a wider pool and retain employees longer, shoring up retention in high turnover industries – and encouraging greater workforce investment.
Recommendation 3: Create Smart Tax Incentives to Protect Local Jobs on Local Main Streets
Barrier:
Investments in small-scale commercial spaces are not readily available for everyday individual investors in Canada – missing out on millions of investment dollars that could support spaces for small businesses generating local jobs and local wealth on our main streets.
Policy Recommendation:
Use tax incentives to encourage everyday Canadian investors – that is, Canadians with modest but meaningful amounts to invest – to invest in small-scale community-owned commercial real estate, protecting small main street spaces from revenue-maximizing investors.
Recommendation 4: Stimulate Insurance Market Competition as a Means to Stabilize Rising Business Costs
Barrier:
Private sector investments in wages, innovation and business growth are being hampered by large and unpredictable rent, insurance and utility costs – leaving workers and small business owners with depressed wages and earnings.
Policy Recommendation:
Investigate ways to introduce competition to the insurance industry to lower and stabilize skyrocketing business insurance premiums.
Only three insurance providers serve 60% of Canada’s SMEs, creating insufficient competitive pressure on premiums. This problem is especially acute in sectors like live entertainment, tourism, and hospitality that struggle to get coverage at all. Reducing and stabilizing costs would ignite the SME economic engine across Canada by reducing the need for emergency fixed cost increases – that business owners currently withhold investments to cover.
We thank the Canadian government for the opportunity to provide input in the federal budget and remain open to discussing these recommendations for building a stronger SME economy.
About the Better Way Alliance:
The Better Way Alliance is a national network of business owners advocating for smart policies that invest in people, stabilize local economies, and create lasting economic opportunity. Through research, advocacy, and direct engagement, the Alliance champions real solutions for Canada’s future.
Media Contact
Aaron Binder
Director
Better Way Alliance
416-677-5088
aaron@betterwayalliance.ca
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