The federal Liberals are listening to Canadians and want to come up with tax reforms that help – not hurt – small businesses and farmers, Minister of Small Business and Tourism Bardish Chagger says.

The government announced on July 18 it will "improve the fairness" of the tax system "by closing tax loopholes and amending existing rules" with a focus on tax planning using private corporations. The argument is that wealthy Canadians use the system to avoid paying higher personal income tax.

But there has been pushback on the changes. Conservative Leader Andrew Scheer has said the changes will hit middle-class Canadians – including small business owners and farmers – the hardest, rather than the rich.

In an interview on CBC K-W's The Morning Edition, Chagger, who is the MP for Waterloo, said the government is listening to those who will be affected by the changes.

"We've had many conversations. [Finance] Minister [Bill] Morneau has travelled the country having roundtables. I have done the same," she said.

"There's people who know the tax system, who are professionals, who are experts ... they're able to contribute in a way to ensure we don't have unintended consequences," she said, noting the consultations will end on Oct. 2 and there are no plans to extend them.

"The longer we're talking about this, the more people are concerned that they will be impacted, which is really raising a fear and not allowing people to be as productive as possible."

Listen to the full interview with Minister of Small Business and Tourism Bardish Chagger:

Prime Minister Justin Trudeau defends his government's proposed tax changes for incorporated small businesses, saying the reforms are about "levelling the playing field" between the middle class and wealthy Canadians. 4:06

'High and dry'

On Sept. 23, the Canadian Chamber of Commerce said the tax reforms could have "crippling effects" on small and medium-sized businesses.

"It is the farmers, mom and pop shops, and entrepreneurs who invested everything into their businesses who are most scared of the government's proposed tax changes," chamber president and CEO Perrin Beatty said after meeting with Morneau in Fredericton that day.

"The government has not answered their concerns today. It has left them high and dry, wondering how they will survive if the weather or the economy takes a turn for the worse."

Conservative finance critic Pierre Poilievre used a pizza to show how an Ottawa pizza shop owner would turn over three-quarters of his investment income to the federal government.

Waterloo, Ont., financial planner Dan Burjoski said clients are already telling him they're worried about their future, including farmers who worry the changes will affect plans to pass farms to the next generation, as well as small business owners who are concerned they won't be able to keep the doors open.

"We're pushing a breaking point on small business," he said. "You are going to see job losses. It's inevitable."

Finance Minister Bill Morneau (centre) meets with business leaders in Gatineau on Sept. 20. (THE CANADIAN PRESS/Fred Chartrand)

Call for more consultations

Paul Nicolaes owns and operates Lush Woodcraft in Kitchener, Ont., and is "appalled" by the proposed tax reforms that he said will negatively affect his business.

It's just another thing on his plate, he said. High hydro rates in the province has hurt him as will the increase in the minimum wage to $15 as of Jan. 1, 2019.

"Small businesses do so much for this province and this country, and then they go and slap you in the face with stuff like this," he said, noting the tax reforms will still hurt people who aren't taking advantage of the current system.

"As if most small businesses are taking these huge advantages and taking these huge pay cuts for themselves. It couldn't be further from the truth."

Nicolaes called on the government to extend public consultations.

"Give these people a chance to voice their opinions and then actually listen to them," he said.

Want fair tax system

Chagger said 75 days for public consultations on proposed tax reforms is the right amount of time to get proper feedback on the changes.

"People who want to contribute to make sure the government that gets it right – that there are no unintended consequences – are working very closely with us. There are many conversations taking place," she said.

People who think they may be affected by the reforms need to take part in consultations, she said.

"We want to ensure the tax system is fair and works for the very people who need it," Chagger said. "We are listening."