A recent report from the Canadian Federation of Independent Business (CFIB) highlights a sharp decline in investment in machinery and equipment in Saskatchewan. CFIB argues that reversing this trend could boost productivity and help businesses produce goods and services more efficiently and at a lower cost.
CFIB Senior Policy Analyst for Western Canada Bradlee Whidden urged the provincial government to remove the provincial sales tax (PST) on investments in machinery and equipment. He noted that most provinces have already exempted PST on such investments, making Saskatchewan one of the few provinces that still tax them.
The CFIB report shows that business investment in machinery and equipment has fallen sharply over the past decade. A decade ago, the average Saskatchewan private sector worker invested about £20,000 per year. By 2023, that figure had fallen to just under £12,000. Machinery and equipment covers a wide range, from basic tools to large tractors.
Whidden warned that the decline in investment is exacerbating Canada’s productivity challenges. Canada’s productivity already lags behind most G7 countries, and Whidden believes this trend could have serious consequences. “Canada risks falling behind globally if we don’t boost productivity and make it easier for businesses to equip workers with the tools they need to be efficient,” he said. “This could result in a loss of entrepreneurs to other countries and lower living standards for all Canadians.”
The Canadian Federation of Independent Business’ call to action emphasizes the need for policy changes to support businesses and strengthen the economy. They argue that eliminating the PST on machinery and equipment is a key step toward achieving those goals.
