Government extends the Canada Emergency Wage Subsidy
“The COVID-19 pandemic has had a profound impact on Canadians in all communities and in all sectors of the economy. We have been listening to concerns raised by employers of all kinds, and we know that extending the duration of the wage subsidy and broadening eligibility will help more workers and will better position Canada for economic recovery. This will allow more businesses and organizations to retain or rehire employees in order to be better positioned when the economy rebounds.”
- Bill Morneau, Minister of Finance
The government has taken action to support Canadian businesses through the outbreak of COVID-19, with targeted new initiatives that:
- Extend the maximum duration of the Work-Sharing program, from 38 weeks to 76 weeks, for workers who agree to reduce their normal working hours because of developments beyond the control of their employers.
- Introduce, in the second half of May, the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses to provide a forgivable loan to eligible commercial property owners, who in turn give a rent reduction of at least 75 per cent for April (retroactive), May, and June to impacted small business tenants who have experienced at least a 70 per cent drop in pre-COVID-19 revenues.
- Launch the Canada Emergency Wage Subsidy calculator to support employers as they prepare to apply for the CEWS. On April 27, 2020, the Canada Revenue Agency launched the application process for the CEWS.
- Provide support to businesses through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) under the Business Credit Availability Program (BCAP). As part of this program, EDC and BDC will provide direct lending and other types of financial support at market rates to otherwise viable businesses and organizations whose access to financing would otherwise be restricted. By working in close cooperation with financial institutions, this program is filling gaps in market access and leveraging additional lending by private sector institutions. Employers with a total payroll of $20,000 to $1.5 million in 2019 will also be eligible to access the Canada Emergency Business Account, which will provide interest-free, partially forgivable loans of up to $40,000 to small businesses, including not-for-profits.
- Allow businesses, including self-employed individuals, to defer all Goods and Services Tax/Harmonized Sales Tax (GST/HST) payments, as well as customs duty payments owed for imports, until June. This measure is the equivalent of providing up to $30 billion in interest-free loans to Canadian businesses. It will help businesses so they can continue to pay their employees and their bills, and help ease cash-flow challenges across the country.
- Defer the payment of income taxes. The government is allowing taxpayers to defer, until after August 31, 2020, the payment of income tax amounts that become owing on or after March 18 and before September 2020. This relief, amounting to $55 billion in liquidity support, would apply to new balances due, as well as instalments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.
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- Additional Support for Canadian Businesses from the Economic Impacts of COVID-19
- Canada’s COVID-19 Economic Response Plan: Support for Canadians and businesses
- Prime Minister announces more support for workers and businesses through Canada’s COVID-19 Economic Response Plan
Media may contact:
Office of the Minister of Finance
Department of Finance Canada
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