Talent Canada: CFIB calls on Ottawa to freeze higher EI, CPP premiums planned for new year
by Talent Canada
As employers face employment insurance (EI) and Canada Pension Plan (CPP) hikes of up to 6.7 per cent, many will struggle to meet even their existing payroll budgets, it warns.
Payroll taxes planned for 2023 mean every Canadian worker will see up to $305 less in take-home pay starting Jan. 1 — unless their employer is able to make up the difference, according to the Canadian Federation of Independent Business (CFIB).
And as employers face employment insurance (EI) and Canada Pension Plan (CPP) hikes of up to 6.7 per cent, many will struggle to meet even their existing payroll budgets, it warns.
As of Jan. 1, 2023, CPP premiums will rise by up to 7.3 per cent due to an increase in both the CPP rate and the Yearly Maximum Pensionable Earnings (YMPE), costing workers and employers up to $255 more in contributions per employee, it said. On the same date, EI premiums for employers are set to increase by as much as 5.2 per cent per employee.
“The maximum additional amount that an employee will pay in EI and CPP contributions is $304.71. It may not seem like a lot, but $300 can cost one family a trip to the grocery store or pay for their transportation or utility bills. Payroll tax increases will hit Canadians at a time when most are already seeing their cost of living quickly increase,” said Dan Kelly, president at CFIB. “The hikes will also affect small businesses. With rising input costs, staggering labour shortages and a potential recession, the economy is already in a bad shape. At minimum, government should be pressing pause until inflation is under control.”