COVID-19 Updates – CTA Members
COVID-19 Federal Emergency Relief
Federal Support for Businesses
- The federal government has released its economic stimulus plan to support Canadians and business through the COVID-19 crisis.
- The package includes $27 billion in direct support to individuals, families, and businesses, plus an additional $55 billion in liquidity measures for the economy via deferred tax revenue.
- There are a range of measures CTA members will want to consider in support of their business operations, such as:
- A new Canada Emergency Business Account which provides interest-free loans (Details below).
- A 10% and 75% wage subsidy programs for employers; and
- deferral of tax payments until August 31, 2020.
- Additional information is outlined below. All the measures included in the federal COVID-19 Economic Response Plan can be found here.
Canada Emergency Business Account
- As of April 9, companies can apply for the Canada Emergency Business Account (CEBA) through their banking institution.
- The new CEBA will provide interest-free loans to small businesses and not-for-profits, to help cover their operating costs.
- The CEBA will provide qualifying businesses with access to a $40,000 line of credit at 0% interest until December 31, 2022. There are no monthly principle payments and a $10,000 loan forgiveness will be applied so long as the outstanding balance is fully paid on or before December 31, 2022.
- To qualify, businesses will need to demonstrate they paid between $50,000 to $1 million in total payroll in 2019.
Federal Wage Subsidy Program
- Small business have been granted immediate relief f with a 10% wage subsidy for the next 90 days, up to a maximum of $1,375 per employee and $25,000 per employer. Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. Employers benefiting from this measure will include corporations eligible for the small business deduction;
- Employers applying for the new 75% wage subsidy will have to demonstrate a 15% reduction in revenue in March 2020 rather than the original 30% original set out. However, eligible employers will still have to show a 30% reduction of revenue for the months of April and May 2020 to claim the subsidy.
- Employers will also be permitted to choose an average of revenue for January and February 2020 to compare for March, April, and May. This change is intended to help new or growing business that may have been unable to qualify based on the original terms.
- The subsidy amount for a given employee on eligible remuneration paid for the period between March 15 and June 6, 2020 would be the greater of:
- 75% of remuneration paid, up to a maximum benefit of $847 per week; OR,
- The lesser of either the amount of remuneration paid, up to a maximum benefit of $847 per week or 75% of the employee’s pre-crisis weekly remuneration.
- Additional detail of the 75% Emergency Wage Subsidy Program can be found here and here
- Employers eligible for the Wage Subsidy will also be entitled to receive a full refund for certain employer-paid contributions to Employment Insurance, the Canadian Pension Plan, the Quebec Pension Plan, and the Quebec Parental Insurance Plan.
- Eligible employers would be able to apply for the Wage Subsidy Program through CRA’s My Business Account portal as well as a web-based application. More details about the application process are expected be made available shortly.
Updates on U.S.-Canada Border & Trade
Status of Canada-U.S. Border
- Efforts to control and mitigate the spread of the virus have resulted in travel restrictions and temporary border restrictions between Canada and the U.S.
- In coordination with the U.S. government the Canadian federal government is now restricting all non-essential travel between Canadian and the U.S. "Non-essential" travel includes travel that is considered tourism or recreational in nature.
- New border measures went into effect on March 21 and will remain in place for at least 30 days, at which point they will be reviewed by both governments. It is understood there are discussion occurring between Canada and U.S. to extend the restrictions.
- While commercial trade is still able to continue, businesses should keep an eye on the Canada Border Services Agency (CBSA) and, in some areas, brace for certain shipment delays.
- CTA recommends members experiencing an issue along the U.S.-Canada border, should call the CBSA Enhanced Border Protection line 1.800.461.9999.
- CTA is advising members who are in need of export or import support due to the COVID crisis to contact Global Affairs Canada officials via email: Commerce@international.gc.ca or email the Trade Commissioner Office in the specific country responsible for the market interests – additional details here.
GST/HST & Import Duties Extension
- The government is now deferring all GST/HST and import duties.
- CRA has released guidance on the payment extensions. The guidance provides additional context on how businesses can process their returns and the payment of refunds.
CBSA issues customs notice on CUSMA/USMCA implementation
- The Canadian Border Services Agency published Customs Notice 20-14 (see here) in order to provide further guidance to importers with the pending transition from NAFTA to CUSMA.
- CBSA officials have stated that regulatory amendments and new regulations made under the Customs Act will be announced in a separate custom notice in the future.
Additional Recommended Resources:
Int. Health Sources:
Canada & U.S. Government Sources:
Third Party Trade Sources: