Business leaders have mixed feelings on budget

Everton McLean
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The provincial budget got a lukewarm reaction from business representatives Thursday, many of whom were happy with the potential spinoffs of the $900-million infrastructure investment, but disappointed with smaller-than-desired tax cuts.

Bradley George, the provincial representative for the Canadian Federation of Independent Business, said the budget did little to spur small businesses, despite some programs aimed directly at them.

The provincial budget got a lukewarm reaction from business representatives Thursday, many of whom were happy with the potential spinoffs of the $900-million infrastructure investment, but disappointed with smaller-than-desired tax cuts.

Bradley George, the provincial representative for the Canadian Federation of Independent Business, said the budget did little to spur small businesses, despite some programs aimed directly at them.

"It's not a bad budget, but it's not really a small business budget either," he said.

He said his members were looking for more tax relief. The extra tax credits in the budget only move the small business corporate tax threshold up to $500,000 from $400,000, a small percentage from his perspective.

Richard Alexander of the Newfoundland and Labrador Employers' Council agreed. While he acknowledged the stimulus package should help recruit and maintain skilled labour in the province, he had hoped to see more tax reductions, in particular, lowering the payroll tax for employers.

"Basically, it means the more people you employ, the higher the tax you have to pay," he said. "We're still the only province in Atlantic Canada with a payroll tax."

But Bill Stirling, vice-president of the provincial division of the Canadian Manufacturers and Exporters' Association, said the budget has some money directed at his members, but "the big thing for us is the infrastructure money."

He said the $900-million fund will generate a lot of activity among local producers of building materials such as windows, doors or lumber. He also praised the province for being dedicated to buying products made in Newfoundland and Labrador.

Bruce Templeton, president of the St. John's Board of Trade, also said the reduction of the debt to $7.9 billion is a positive step, as are the corporate tax incentives.

Asked whether there is any weight to accusations the provincial government isn't doing enough to diversify the economy, Templeton downplayed the notion.

"There's lot of opportunities. Research and R & D will open up all kinds of areas, and the areas around labour and attracting labour are all very, very positive," he said.

Kennedy took a similar tack when asked what the province was doing to diversify. "We created the research and development council, oceans technology and we're looking at other innovation strategies," he said.

"Let's not forget that we have on the horizon three major projects. We have the Vale Inco project which is started now but will ramp up in 2010. We have the Hebron and we also have the Lower Churchill, where we're in the environmental assessment process. These are big projects other provinces don't have.

"We're quite comfortable where we are."

emclean@thetelegram.com

Organizations: Canadian Federation of Independent Business, Canadian Manufacturers, St. John's Board of Trade R & D

Geographic location: Newfoundland and Labrador, Atlantic Canada, Hebron

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