Economic Update for Small Business – Federal Government

March 19, 2020

Yesterday, the Prime Minister, Justin Trudeau, announced a series of new measures to limit the spread of COVID-19 and to support businesses and workers affected by the global pandemic. These measures include the imminent closure of the Canada – US border to non-essential travel and a fiscal stimulus package of $82 billion to stabilize the economy.

The fiscal stimulus package includes $27 billion in direct supports to individuals and businesses and $55 billion to facilitate business access to liquidity through tax deferrals. Parliament will be recalled in the coming days to vote on the implementation of some of these measures.

These measures largely support those who lost their jobs by enriching the employment insurance program, those with children by increasing the child care benefit, and businesses experiencing cash flow issues by delaying tax remittances.

While this is a positive step in the right direction, it is crucial that the measures are implemented immediately. CCRVC, along with our industry partners, continue to advocate for targeted support directed at the industries directly affected by this unprecedented crisis. We have briefed government leaders on the massive impacts on the RV and Camping Industry. The Minister of Finance has signalled that this is the first phase of the fiscal stimulus and more support will be announced in the coming weeks.

KEY POINTS FROM THE FEDERAL GOVERNMENT STIMULUS PACKAGE FOR CCRVC CAMPGROUNDS

Support for businesses

• 10% wage subsidy for small businesses up to $1,375 per employee, and $25,000 per business. This new benefit is available immediately to businesses for three months, through a reduction of the remittances of income tax withheld on employees’ remuneration.
• CRA will allow businesses to defer income tax payments to September 2020
• The Business Credit Availability Program (BCAP)will allow the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) to provide more than $10 billion of additional support, largely targeted to small and medium-sized businesses (announced last week)
• Credit and liquidity support through financial Crown corporations, Bank of Canada, OSFI, CMHC and commercial lenders (e.g., Domestic Stability Buffer, Insured Mortgage Purchase Program, Banker’s Acceptance Purchase Facility). These measures are effective immediately.

 Support for workers

• Introduction of the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks to support workers. This new benefit would be administered through the CRA and provide income support to:
• Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits.
• Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not qualify for EI sickness benefits.
• Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.
• New emergency support benefit to provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment.
• EI Work Sharing Program
• Tax filing due date deferred to June 1^st from April 30^th
• One-time special payment through the Goods and Services Tax credit (GSTC) for low-income workers