The following press release was issued on behalf of the Canadian Chamber of Commerce re the March 4th, 2010 Federal Budget

Budget 2010 Analysis - issued by the Canadian Chamber of Commerce, Thursday March 4, 2010

The Canadian Chamber welcomes the federal government’s strategy to stay the course on the
recovery plan, its approach to balancing the books over the medium term, and its emphasis on laying
the foundation for a more innovative and competitive economy. The government recognizes that the
substantial program spending increases over the last decade are not sustainable. It plans to limit
increases in program expenses to 0.8% per year over the 2010-11 to 2014-15 period. This will not be
easy. Since fiscal 2000-01, growth in program expenses has been averaging a little more than 6% per
year. The Canadian Chamber will watch closely to ensure Ottawa lives up to its commitment to rein
in spending and improve efficiency in the government sector

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Revenues are projected to increase approximately 6.5% per year over the forecast period. With
nominal growth in the economy expected to average about 4-5 % per annum, growing our way out of
deficits will be challenging.

In the final analysis, we need to get our fiscal house in order so we can provide the economic
flexibility needed to prepare for the jobs of tomorrow and meet the challenges posed by an aging
population.

Going forward, it is crucial that the government refrain from increasing taxes that hinder job creation,
entrepreneurship and investment. We can't afford to erase the hard-earned progress we have made
in improving our international tax competitiveness. While Budget 2010 explicitly stipulates that “the
government will not raise taxes,” the projections in the Budget suggest Employment Insurance (EI)
premiums will rise significantly (the maximum of 15 cents) over the 2011-2014 period to recover the
deficits incurred by the EI program during the recession. Thereafter, premiums will be set at the
break-even level. Increasing payroll taxes will discourage employers from hiring just as the economic
recovery matures. Over the long-term, these costs are ultimately passed on to employees in the form
of lower wages, taking a bite out of personal income. The Canadian Chamber urges the government
to keep rate increases at manageable levels by devising a workable financing scheme for EI – i.e.
amend the present rate-setting formula with a view of balancing the EI Account over the business
cycle of up to ten years – to help smooth out increases in premiums.

Lastly, small and medium-sized businesses are the backbone of our economy, accounting for about
98% of all businesses in Canada and employing more than 5 million people. Advances in
communications and information technologies, the accelerating pace of global economic integration
and intensifying competitive pressures are creating ongoing adjustment pressures and challenges
especially for small- and medium-sized businesses. We applaud the government’s focus in Budget
2010 to support innovation in Canada’s small business sector, reduce the regulatory burden, improve
credit availability, and continue to reduce the tax compliance and administrative burden facing
businesses. These initiatives will result in higher performing businesses and higher paying jobs for
Canadians.

We also welcome the government’s focus on advancing the digital economy which will help raise
business productivity, and contribute to a more prosperous and competitive Canada. Canadian
businesses lag their international competitors in the development and adoption of innovative ICT. In
the knowledge-based economy, Canada must be a world leader, not a laggard.

The Throne Speech contained important additional commitments in areas such as strengthening
intellectual property rights. The Canadian Chamber analysis of the Throne Speech can be viewed at
chamber.ca.

March 5, 2010

While there are a number of changes and modifications introduced in the budget the three things impacting businesses and individuals the most are listed below.

Highlights of the March 4, 2010 Federal Budget

Business:

• EI premiums will be kept stable in 2010 at $1.73 per $100 of insurable earnings.
•  No Tax increases
•  Work-Sharing plan will be extended by an additional 26 weeks to a maximum of 78 weeks, with greater flexibility in the qualifying criteria for new work-share agreements.

Personal:

• An ecoENERGY retrofit program has been introduced replacing the home renovation tax credit which expired at the end of January.
• No Tax increases
• New incentives for youth with an investment of $108 million over the next three years in a variety of areas, including internships, support for young entrepreneurs and youth at risk.