I have thought this as well. Why not leave small business alone and let everyone file joint returns (like the Carter commission recommended last time Canada had a tax system review and like they do in the US). Additionally, I would say that everyone, business owner or not, should be allowed to save as much as possible for retirement and this should be tax deferred until the funds are taken out. Remove caps on RRSP contribution and leave small corporations alone. This would be much more fair and possibly less contentious. But alas, this is not about fairness, it is about government revenue.