43 per cent of Canadian business community give budget a "B" or higher: survey

TORONTO -- A survey conducted by the accounting firm Ernst & Young has found that 43 per cent of Canadian business people graded last week's federal budget a "B" or higher. Overall, respondents were generally split down the middle on the specific measures it entailed, the firm found.

"Not unlike the Canadian political scene itself, the response to the budget was somewhat polarized," says Gary Zed, Tax Markets Leader, Ernst & Young.

"The business community seems particularly divided on whether this budget will stimulate jobs and growth or the economy overall — which we know was a major focus for the government this time around."

For example, 44 per cent said they believe the budget would stimulate jobs and growth moderately, with a further 1 per cent saying they believed it would provide a strong stimulus. That's a contrast to the 46 per cent who did not think the measures introduced would drive results in these still-struggling areas.

Respondents were similarly split on whether the budget struck the right balance between stimulating the economy and reducing government expenditures. Thirty-six percent of the respondents agreed that it did, 38 per cent disagreed, and 13 per cent strongly disagreed.

"That divergence in opinion was clear on the business investment front, too," added Fred O'Riordan, National Tax Advisor who also heads up Ernst & Young's economic analysis and analytical services practice.

"Forty-five per cent of respondents said the budget would stimulate business investment from their company's perspective, while an almost equal 46 per cent said it would not."

In contrast, respondents were much more aligned in their views on whether the federal budget deficit will be eliminated by 2015, as projected in this budget. While 32 per cent thought it likely or highly likely, a whopping 67 per cent thought it unlikely, or highly unlikely.

Also, 54 per cent agreed targeted tax relief and economic incentives to support specific industries were good economic policy while 40 per cent disagreed. The Ernst & Young National Survey polled individuals, primarily from the business community, between March 21 and March 25.