The following text may have been generated by Optical Character Recognition, with varying degrees of accuracy. Reader beware!

6 The Canadian Statesman, Bowmanville, Wednesday, August 3,1994 Section Two Cutting Red Tape and Helping Small Business Dear Editor: A recent edition of The Canadian Statesman carried quite a large headline headline and story under the by-line, "Durham MP hopes to reduce Government Government Red Tape." I have attached to this letter, not a HOPE to reduce government red tape, but a plan by our government to cut red tape and help small business in Ontario. I hope you will find it interesting, and that you will give it the print and place in your newspaper it deserves. Sincerely, Gordon L. Mills, M.P.P. Durham East Clearing the path Small businesses are the backbone of Ontario's economy. As we emerge from this recession, small businesses are the largest creators of jobs. It's important for government to help small business by reducing the time they spend on paperwork so they can devote.more effort to growing growing and creating jobs. "Clearing The Path" is one such initiative. It is about building partnerships partnerships to streamline and simplify the relationship between business and government. We've been working with an advisory committee of business business representatives on ways to reduce reduce the paper burden on small business. business. We have developed a long-term plan to streamline and simplify the filing and regulatory processes for establishing establishing new businesses. We're starting this September by setting up 10 to 15 one-stop registration registration sites across Ontario at our Business Business Self-Help Offices. This service will ease the burden considerably for the average 90,000 new businesses that currently must deal with up to 10 provincial ministries. As we move into the second phase in 1995, we will implement a single business registration number. As well, .we will institute a system of unified reporting for various government government requirements. This will allow businesses to use a single form to remit remit Retail Sales Tax, Corporate Income Income Tax and the Employer Health Tax. This measure will significantly reduce reduce the paper burden faced by businesses businesses in Ontario. This will lead to the introduction of electronic, on-line access, which will further reduce the number of government forms with which businesses must deal. Working with other levels of government to streamline services Small business owners often have to deal with several different levels of government when seeking information information on business-related programs and services. The Ontario government government wants to improve customer service service and reduce overlap and duplication duplication for small businesses. That's why we're currently negotiating negotiating with the federal government to establish a joint Canada-Ontario Dear Mr. James: Re: Editorial--"One Small Step for..." (July 27,1994) When I look back at the moon landing of 25 years ago, I recall being being puzzled by the (hu)man (con)quest of frontiers. It was nice that a person was on the moon, but it had nothing to do with the reality of a little girl in grade 5 trying to understand understand the simpler aspects of life...such as why wars happens, why world leaders are murdered and why poverty and famine wipe out the weak and helpless like flies unwelcome unwelcome at the technological picnic. Twenty-five years later I am still trying to understand why wars happen, happen, why world leaders are murdered, why famine and poverty wipe out the weak and helpless and why genocide is a common word in my vocabulary. I am still trying to understand why so many are fooled by the idea of (con)quest of frontiers as a noble pursuit, as the grandest of human accomplishment, accomplishment, but, which appears to have more to do with feeding the human human spirit a superficial diet of excitement excitement and challenge. On the edge of conned quests, many of us are trying to understand why we mourn women and children who are mutilated and/or murdered by husbands, fathers and lovers. And, I am trying to understand why the memory of our grief - the plaque placed at the Visual Arts Centre - is fair game for conquest. Indeed, landing on the moon was one small step. If we were honest about the noble goal, however, (of any conquest) we would remember that it has more to do with the quest for greater power and glory than for greater human spirit and integrity. I disagree with your editorial. If it was a fact that equal effort and dollars dollars was invested in the human 'condition', 'condition', as in the pursuit of power and glory, then you have something of an argument. Furthermore, if it is 'challenge' 'challenge' that the human spirit yeams...the real challenge lies in the conquest of war, starvation, and genocide, genocide, and in the elimination of violence violence against all species and the planet. planet. The challenge in our community lies in stopping the violence in our neighbourhoods... and that inflicted upon the memorials to our dead. One small step... Sincerely, Helen MacDonald, Newtonville INDEPENDENT FINANCIAL ADVICE! MYTH - All Mutual Funds invest in the stock market. WRONG - Stocks, Bonds, T-Bills, Mortgages, Foreign Equities, etc. With over 700 Mutual Funds on the market where would you to go find the one that suits you? REGAL CAPITAL PLANNERS LTD. Call Steve Scatterty Financial Advisor, Bowmanville 623-1936 © Business Service Centre (COBSC). This partnership would merge two business services already in existence in Ontario: the Ontario Small Business Business Hotline, a general inquiry ser-. vice for business start-ups; and Indus-, try Canada's Business Service Centre. We want to build on that success by continuing to help them overcome barriers to growth and to create new jobs. Greater access to capital Small businesses often have difficulty difficulty getting access to capital from traditional financial institutions, especially especially for start-up. The Ontario government understands understands this problem. We also recognize recognize the important role small businesses businesses play in helping renew our economy and in creating jobs. That's why we are taking action in provincial provincial jurisdiction to address this concern. concern. Last year, we launched the Ontario Ontario Lead Investment Fund to provide a new source of equity capital to innovative innovative growth firms. It is a $70 million partnership fund between the Ontario government and four major banks. It will lever over $200 million of investments in innovative growth firms in Ontario. ( . We've also introduced Community Community Investment Share Corporations, which help provide equity capital to smaller, community-based businesses. businesses. The province will guarantee die principal of investments in the CISCs, which in turn will provide up to 500,000 in equity financing for .local .local business start-ups and expansions. As well, we passed legislation to support labour-sponsored investment funds, in order to unleash the job creation potential of these pools of capital. Thanks to a provincial tax credit, labour-sponsored investment funds now have a pool of over $250 million to invest in Ontario growth firms. In addition,, we are working with provincially-regulated financial institutions institutions to track lending activities and help us analyze which companies are. having trouble getting capital. This information will help us determine which sectors of the economy and the types of small businesses are having difficulty getting access to capital. We hope dus information helps us to work in partnership with business and financial institutions to improve the way we finance economic growth. We have called on the federal government and the banks they regulate regulate to follow our example and help small businesses and other sectors get the financial help they need. Helping small business create jobs through lower taxes Small business is the biggest generator generator of new jobs in our economy. And Ontario's number one priority is putting Ontarians back to work by helping to create new jobs. We recognize recognize that payroll taxes have an impact on small business hiring because they represent a higher proportion of their costs. As a result of this partnership, small businesses would have timely and accurate access to information on programs and services offered by both the federal and provincial levels of government. Through a one-stop shopping initiative, businesses could call one phone number to get information information on programs and services offered offered by both levels of government. This call centre would handle 70 to 80% of all general inquiries on business programs and target key clients clients for additional service, while being being more cost-effective. A broader approach to helping small businesses grow The Canada-Ontario Business Service Service Centre may be a new initiative, but it is part of the Ontario government's government's broader approach to help small businesses grow. Government is an important source of information. It collects and maintains extensive data bases which can also be a valuable resource to the business community. For example, the government maintains databases that can be used to identify business opportunities such as government procurement, investment, trade, research research and development. The Ontario government is developing developing Businet, an electronic bulletin board to provide access to information information maintained by government to assist assist business in its decision-making process. The goal is to provide the greatest possible access to commercial commercial information and generate revenue revenue from information that has commercial commercial value to business. Innovative Growth Firms We're also helping firms that have a unique product or service to upgrade upgrade their operations and overcome barriers to growth through a new program program called the Ontario Innovation and Productivity Service (OIPS). This program recognizes the need to invest in new and innovative firms that will create the jobs of the future. OIPs provides conditional grants to cover 75 per cent of the cost of a company's Strategic Business Assessment Assessment and Action Plan, to a maximum maximum of between $15,000 and $25,000, depending on the size of the company. Action Plans developed through OIPS identify barriers to growth and propose Strategic Projects Projects to overcome them. Strategic Projects are eligible for assistance covering up to 50% of the costs. For example, assistance can be used to hire marketing personnel to help a company strengthen its marketing activities. activities. In the last year, OIPS has helped more than 200 firms. On average, the first group of firms through the program program have created about 10 jobs each. These firms project that they will each hire an additional 33 people over the next three years, creating more than 8,000 jobs. by Brian Costello MUTUAL FUND LPs EXTENDED There's great news for higher income investors and especially those who are nearing retirement or those who anticipate an income reduction in a few years. Revenue Canada has given you a nice break. Revenue Canada had been threatening to end the use of mutual fund limited partnerships as a tax saving vehicle. Instead, they've only made slight alterations to the way we use them. We can expect them to last a while longer. But, you had better learn how to use them as soon as possible because what's around will be snapped up quickly and the ones issued in the next year will be better than the new version. The people who will get the most benefit from these plans are those in high tax brackets and those who expect their income levels to fall in coming years. Back in the "old days" most mutual funds had a front end commission. Canadians balked at the idea. To eliminate front end loads the mutual fund industry invented the rear end toad. Investors who hang on tong enough, usually six or seven years, don't have to pay any commission at all. However, to compensate the salespeople the industry sold something called a mutual fund limited partnership. It pays out commissions to the salespeople and passes those costs on to investors as a tax deductible business expense. In return the limited partnership receives any rear end commissions paid by investors if they sell too early and also shares in the management fees earned by the mutual fund company. As a result, investors get a tax deduction in the early years but then earns a nice income for a number of years. And, that's the way you should took at these things. You aren't buying a mutual fund. You are buying three years worth of tax deductions plus future years income. The tax deductions used to be huge; Originally you could write off your entire investment cost in the first years. Presently, you get 50% in the first year and two more years at 25% each. Beginning June 1995 the rules will be changed to three years at 33 1/3% each year. It may sound like a small change but that extra tax relief in the first year can pay off handsomely. It's natural to say that those in the high tax brackets should buy mutual fund LPs but there are many others who can benefit as well. The higher income types don't really save that much tax. It's more of a tax deferral. They save a ton of tax in the first few years but the income earned will be added to their other forms of income in future years. Where they really win though is in the ability to move substantial amounts of income ahead a year or two so they have the time to rearrange their affairs properly. These things are a fantastic time maker for those who all of a sudden realize they have a high tax burden. They also work fantastically for taxpayers who are nearing retirement. You expect your income is higher now than it will be in retirement. As a result, you take the tax relief now but you have a higher income in the future when you need it and when you won't be hit with as much tax. Many seniors use them when they can no longer contribute to a registered retirement savings plan. In fact, I've seen many people turn 71 who objected to having to take an income via an annuity or a RRIF. They purchased mutual fund LPs to offset the tax on that income. Some people have a fluctuating income. Salespeople, the real estate industry, home builders and many others would find these a natural part of their financial planning strategies. Load up in the hot years to save tax, receive an income in the slower periods. It's almost like the old Income Averaging Annuities that we used to be able to buy to spread the income and the tax burden forward. In fact, I spoke to a couple of player agents who tell me that athletes love mutual fund LPs because their careers are relatively short. There is one use that will be especially valuable this year. This is the last year we can claim tax free capital gains. Even though they will be tax free they may wipe out social benefits because of this one time spike upward in Net Income. Mutual fund LPs are deducted before the Net Income calculation. As a result, you can get your tax free capital gains plus keep your social benefits. We can utter a little "whew" that Revenue Canada has extended these plans. But, don't expect them to be here forever. In addition, remember that just like any investment it pays to deal with somebody who can shop the market and get access to any or all of .the different company's offerings.