REGINA – The business community has weighed in with reaction to the 2026 Saskatchewan budget, and it includes a range of opinions on how the budget will impact them.
While the business community has welcomed the government keeping its election platform commitments and incentives in place, there is concern being expressed about taxes and the deficit, and the ability of small business to compete.
The Saskatchewan Chamber of Commerce said they were pleased to see the province hold the Small Business Tax Rate at one per cent, provide $125 million in funding for the workplace development program, and continue with the Small and Medium Enterprise Investment Tax Credit. In a statement, they were pleased to see no tax increases or new taxes, as well as advancing its commitment to continued income tax reductions.
But there was concern about the projected $819.4 million deficit, with the Sask Chamber saying that deficit financing must come with a clear timeline and measurable commitments to fiscal recovery.
“Today’s budget makes meaningful investments in key priorities and recognizes that small and medium enterprises and entrepreneurs drive Saskatchewan’s economy,” said Chamber CEO, Prabha Ramaswamy, in a statement. “Protecting core investments in a time of great uncertainty lays the foundation for a more competitive and resilient province for years to come.”
There were similar sentiments from the Regina Chamber of Commerce, who hosted Finance Minister Jim Reiter at a post budget event on Thursday. Regina Chamber CEO Mike Tate outlined to reporters afterwards some of the things their members had wanted to see in the budget.
He said they wanted to see “some stability, and with the exception, predictability always comes up, and I think increased municipal funding and a model that's more consistent.”
Tate made known that he thought the budget achieved those objectives.
“I think given the situation across the globe, I really do. I think our government is controlling what they can control. From an economic standpoint, they're providing locally grown incentives to invest in Saskatchewan businesses with a 45 per cent tax credit. They're keeping the corporate small business tax rate at one per cent. So again, they're doing what it takes to keep that investment in this province and allow our organizations to grow.”
But the SaskPower rate hikes announced earlier this year are a concern.
“Yeah, I mean, they've taken away the carbon tax, but then we're going to be faced with an increase, so it's a bit of left pocket, right pocket side,” Tate said. “I think ultimately the pressures that SaskPower faces in terms of capital infrastructure, it's a difficult province to deliver power to. Let's be honest, there's 1.2 million people. It's a large scale grid over a very small population base in reality, right? So they're faced with a lot of capital pressures.”
The view of the budget was less positive from Brianna Solberg of the Canadian Federation of Independent Business, who said she thought small businesses “will largely feel overlooked by this budget.”
“There seems to be a heavy emphasis on large capital projects and big infrastructure projects, which are important, but small firms matter too. And I think right now they're telling us that they're facing major barriers to invest and grow, rising input costs and significant economic uncertainty. And really, this budget does nothing to acknowledge that for small firms.”
Solberg said there were some measures CFIB had put forward to help small businesses. “First of all, increasing the small business tax rate threshold to $700,000 would help small businesses be able to keep more of their income and reinvest that into their business. And we're also looking at the PST on capital expenditures.
That's something that, you know, in other provinces, businesses are able to write off the PST. And here it's a real barrier for small businesses to be able to afford new capital when they're charged an extra six per cent.”
Solberg said that the cost pressures are “mounting for small businesses,” pointing to the SGI and SaskPower increases, “not to mention all of their input costs are going up due to inflation.”
“And while there's no new added costs in terms of taxes in this budget, I say again, I don't think it went far enough to address some of the concerns for small businesses.”
Gage Haubrich of the Canadian Taxpayers Federation called it a “bad budget for taxpayers.” He particularly pointed to the debt situation.
“You know, the government's wasting more than a billion dollars on debt interest payments this year. That's money that can't be used for essential services. It's just flushed down the drain because of the government's poor financial decisions, you know, and the poor financial decisions continue because the government essentially failed to find savings basically anywhere in this budget because they're increasing spending on almost everything, and that means more debt being added to the pile, more money being wasted on those debt interest payments, and that's going to cost taxpayers.”
Haubrich particularly was concerned with the $819 million deficit forecast, as well as the Q3 numbers showing the deficit as over $1.2 billion.
“Well, both of those numbers are frankly ridiculous,” said Haubrich. “It shows that the government has a huge overspending problem, right? When you're a regular Saskatchewan family, some stuff's happening, you get some unexpected expenses, you've got to cut back on other things that aren't essential. So the government has decided to do the opposite of that and spend more. All that does is increase the debt burden on the taxpayers, and we saw that one billion dollar in debt interest payments number.”
As for government plans to find savings by reducing the public service through attrition, Haubrich did not think that was nearly enough
“It's nowhere near good enough, right? The government's still increasing overall spending by 1.2 billion dollars this year compared to last budget. So anything they're saying they're doing with savings isn't anything real, because overall spending is going up. That's not a saving in any sense of the word.”
Reiter believes business community understands government's objectives
Finance Minister Jim Reiter believes the business community is understanding what the government was trying to achieve with the budget.
“Well, I think it's a case of they understand the fiscal restraints we're under,” said Reiter. He said with the one per cent business tax that “small businesses are pretty happy with that, and I think it's about continuing the work we've been doing. You see the trade missions we've been on, trying to increase trade with other countries because of the tension with the U.S., and I think it's working.That's why those companies, big companies are choosing to invest big dollars in Saskatchewan.”
One thing Reiter was asked about by reporters was the PST and the pressures that put on businesses.
“You know, depending on fiscal situation, things change from year to year and over a period of years. We always sort of review most things every year through budget time, but we have to be realistic too,” said Reiter.
“At the same time, we have an opposition criticizing us for being in a deficit position. To go cut revenues is just going to exacerbate that situation, so we've got to be fiscally prudent too.”
Reiter did point to the incentives in place, including the announcement of the one per cent tax for small business, “which I think is well received, but again, nobody wants to pay tax.”
“This government's been about trying to reduce tax wherever possible, but the money for health care and education has to come from somewhere.”
The opposition New Democrats, meanwhile, continue to say the budget is bad for business.
“I just don't understand the fictional world that the finance minister is living in here in Saskatchewan, compared to what people are thinking,” said Sally Housser, NDP critic for energy and resources. “The out-of-touchness that you've never had it so good in this province, when every metric is to the contrary here. We have a budget that is going to hurt people, that is going to make things more expensive, does nothing to fix our crumbling education, our crumbling health care system, address the affordability crisis.”
She also questioned the effectiveness of the affordability measures.
“Yeah, well, you know, tax time and you've got tax credits, tax credit, tax credit. In order to get a tax credit, you got to spend the money first. People don't have that money to put out right now,” said Housser.
She repeated the NDP’s call for the fuel tax to be suspended, something she said was particularly hurting small businesses including in her own riding of Regina University.
“What we're asking, and it's not forever, but while the government is taking a windfall from this unfortunate conflict, disastrous conflict in the Middle East, they're getting the money in and the people of Saskatchewan are paying the price at the pumps. So whether it's for a few weeks or a month — we're asking for a month right now — give people a break right now. It doesn't have to be forever, but this is what we need. They can't wait around until tax time. That doesn't put the $20 in your wallet that you need to feed your kids or fill up at the pump right now.”
