Everyone remembers Michael Corleone’s famous line in The Godfather, Part III: “Just when I thought I was out, they pull me back in.”
And that, says IIAC president and CEO Ian Russell, is what seems to be happening to Canada’s economic recovery: right when it appears to be picking up, the rug gets pulled from under the rebound.
Russell says small business is critical to turning this around. It’s “the engine of growth, key to job creation and economic diversification, and a key source of innovation and technology.”
The problem is getting access to much-needed capital. “The dearth of financing activity is evident right across the small business marketplace as the lack of public market access for capital has made angel networks and venture capital funds reluctant to fund early stage and emerging businesses,” he says.
He adds the recent federal budget missed a perfect opportunity to assist small business growth, and suggests the national cooperative securities regulator could play a role in boosting those firms.
Russell calls for direct tax incentives to help small business raise equity capital:
- A preferred capital gains tax rate for treasury offerings and secondary market transactions for the shares of small business; or
- A tax-free capital gains rollover provision for purchases of eligible small company shares.
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