The Canadian government will give a new tax break to small businesses and entrepreneurs who put people to work, the Canadian Broadcasting Corp. reported Sunday.
The CBC said it learned that the Hiring Credit for Small Business will be announced Tuesday. The program will give small-business owners a tax cut equivalent to the additional Employment Insurance premiums associated with hiring a new worker, up to $1,000, a memo sent to the Conservative caucus and obtained by the CBC said.
"Every time a small business hires an additional worker, it results in additional costs -- everything from training to EI premiums," the memo said, noting that with the tax credit, "a small business could hire an additional worker at a salary of up to $40,000 or two part-time workers at a salary of up to $20,000 each and they would not have to pay additional EI premiums."
Up to 525,000 small businesses and entrepreneurs in Canada might be tempted to take advantage of the program, the CBC said.
Canada, which had a jobless rate of 7.3 percent in August, has created 600,000 net new jobs since July 2009, the memo said.
The new program is "an important part of our low-tax plan to complete the economic recovery," the memo said.