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Entrepreneurs are still digesting all of the information in the latest federal budget, but so far they have reason to like what they see. The government’s election-friendly budget sent a clear message to owners of Canada’s more than one million small and medium-sized businesses: we’re here to help. Tax cuts, incentives to invest in manufacturing and innovation, and a reduction in bureaucratic red tape were just some of the entrepreneur-friendly highlights Finance Minister Joe Oliver trumpeted on the floor of the House of Commons.

This balanced budget with its projected surpluses is packed with pre-election goodies and entrepreneurs are clearly one of the major targets of the Conservative government’s fiscal generosity. But the big question is the degree to which these measures will help spur growth, innovation or even the personal financial success of the entrepreneurs they’re intended to help. On that, it could be argued that Canada’s SME owners are clear winners in this budget—but perhaps less than they might initially think.

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Take the lowering of the small business tax rate to 9% from the current 11%. While the reduction will undoubtedly be welcome news to most that own qualifying businesses, the savings will be slow to arrive. The small business tax rate will be phased in by 50 basis points a year between 2016 and 2019 for total tax savings of $2.7 billion, according to government estimates. The gross-up factor—the calculation used to determine tax payable on non-eligible dividends—will also be gradually lowered to 15% from the current 18% over the same period.

Both measures are decidedly SME-friendly, but delays in their introduction will mitigate the immediate benefits for business owners. Still, it will likely be perceived as a step in the right direction by the bottom line-focused business community.

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In addition, the lifetime capital gains exemption on farm or fishing property will be increased to $1 million, while the accelerated capital cost allowance is being extended to the end of 2025. The allowance, which was set to expire this year, provides tax breaks to manufacturers that invest in new equipment. Think of it as an accelerated tax credit designed to spur machinery upgrades, innovation and improved productivity—and one the government hopes will provide a boost to factories in manufacturing-heavy provinces such as Ontario and Quebec. That will be coupled with up to $100 million investment over five years to support automotive technology and product development.

To ease the financial burden of hiring more employees, SME owners will see their employment insurance premiums frozen for three years, just as the government takes steps to ease tax-reporting red tape. Most new employers currently required to remit tax paperwork monthly will instead be able to report on a quarterly basis, while reporting requirements for foreign assets will also be relaxed.

The budget offers plenty of incentives for targeted groups, as well. As previously announced, young entrepreneurs will receive $14 million in financing and mentoring support over two years through the Futurpreneur Canada fund, and women entrepreneurs will also receive tax breaks and enhanced access to financing. Research and development will also get a $1.3 billion boost over six years.

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A less obvious benefit to SME owners is the decision to increase in annual Tax-free Savings Account (TFSA) contribution allowances to $10,000 from $5,500, as well as the plan to relax rules around minimum withdrawals for Registered Retirement Income Funds. Both are significant changes for entrepreneurs, the vast majority of whom lack pensions. In theory, a business owner in a top tax bracket who maximizes her annual Registered Retirement Savings Plan contributions will be able to shelter part of her refund in a TFSA, thereby bolstering her retirement savings and avoiding additional capital gains taxes on investments.

In short, this is a win-win budget for SME owners, but not in the short term. Relief in the form of tax cuts, credits and support programs will be felt, but only over time. In other words, this isn’t a budget that’s bound to transform your business over night. But as an entrepreneur, I’m sure you’ll at least appreciate the tax savings when they eventually arrive.

Armando Iannuzzi is a tax partner at Kestenberg Rabinowicz Partners LLP, a Markham Ont.-based firm that provides strategic tax, accounting and finance services to entrepreneurs.

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