The federal government has begun to release its COVID-19 Economic Response Plan that provides support to businesses and Canadians.
Further information about these measures are below.
Support for Businesses:
- Increasing access to Credit
Business Credit Availability Program will allow the BDC and EDC to provide $10 billion of additional support targeting small businesses. This support will allow private sector lenders to coordinate on credit solutions for individual businesses. This program has been expanded to mid-sized companies with larger financing needs. Support for mid-market businesses will include loans of up to $60 million per company, and guarantees of up to $80 million.
This program includes the Canada Emergency Business Account which will provide interest-free loans of up to $40,000 to small businesses and non-profits. To qualify, these organizations will need to demonstrate they paid between 20,000 to $1.5 million in total payroll in 2019. Click here for more information.
Click here for more information.
- Large Employer Emergency Financing Facility (LEEFF)
This will provide bridge-financing to Canada’s largest employers, whose needs are not being met through conventional financing in order to keep their operations going. This support will not be used to resolve insolvencies or restructure firms, nor will it provide financing to companies that otherwise have the capacity to manage through the crisis. Strict parameters have been put in place for businesses who wish to access this program. More details are available here.
- Temporary Wage Subsidy
This 3-month subsidy is equal to 10% of remuneration paid during that period – to a maximum of $1,375 per employee and $25,000 per employer. Non-profit organizations and charities are also eligible. Click here for more information.
- Canada Emergency Wage Subsidy
The federal government has announced additional support for Canadian businesses, non-profits and charities that are able to demonstrate a loss in revenues from a comparable time period. This emergency wage subsidy would apply to 75% of the first $58,700 normally earned by employees – representing a benefit of up to $847 per employee. This program would be in place for a 12-week period from March 15 to June 6.
The application portal can be found here.
- Canada Emergency Commercial Rent Assistance
This program will provide loans (including forgivable loans) to commercial property owners who in turn lower or forgo the rent of small businesses for the months of April (retroactive), May and June. Further details about this program will follow shortly.
- EDC’s Canada Account
Changes will be made to support exporters deemed to be in the national interest – allowing the government to provide additional support to the companies through loans, guarantee or insurance policies.
- Defer payments
CRA will:
- Allow businesses to defer the payment of income tax to September 2020.
- Not initiate any post assessment GST/HST or Income Tax audits for the next 4 weeks.
- Temporarily suspend audit interaction with taxpayers and representatives.
- Regional Support
Flexible arrangements may be made with regional development agency (RDA) in your region – support may be available and is assessed on a case-by-case basis. Click here to find the RDA in your region.
Support for Canadians
- Temporary Income Support
To support Canadian workers and parents, the government will:
- Waive 1-week waiting period to claim EI sickness benefits.
- Introduce the Canada Emergency Response Benefit for workers who lose their income as a result of the COVID-19 pandemic. Its also covers Canadians who are still employed but not receiving income due to work disruptions and provide up to $2,000/month for up to 4 months. Application portal to be open in early April. Click here for more information.
- Implementing EI Work Sharing Program – providing EI benefits to workers who agree to reduce their normal working hours.
- One-time special payment through a GST credit to low- and modest-income families.
- Increase the Canada Child Benefit.
- Delayed tax filing date and deferral of payment of income tax amounts.