As the COVID-19 (coronavirus) pandemic has brought much of Canada’s economy to a halt, provincial governments are looking to support businesses and regional economies. Some are providing tax extensions, others will provide new lines of credit and compensation for employees.
At the federal level, Prime Minister Justin Trudeau also announced $82 billion as part of the federal government’s COVID-19 Economic Response Plan, including small subsidies and BDC loans. Regional Development Agencies, such as FedDev Ontario, are applying a three-month deferral for companies in repayment, which takes effect on April 1.
Trudeau is scheduled to speak with premiers and territorial leaders on Monday evening about measures to curb the spread of the virus.
Here’s what Canada’s provinces are currently doing to help business communities weather the impact of the pandemic. The article will be updated as more information comes in.
The Ontario government has launched Ontario Together, a new website aimed to help businesses and their employees work with the province to meet the challenges of COVID-19. Ontario Together will examine supply challenges in the province and request ideas and advice from Ontario’s business and manufacturing communities on how the government can work to meet the demand.
Through the Ontario Together initiative, the government plans to partner with business community members in Canada and around the world, in order to redirect resources and explore new ways of doing business.
The province has also introduced legislation aimed to protect the jobs of employees that are in isolation or quarantine, or those who need to care for children or other relatives. Ontario’s government is expected to announce business supports in its spring economic update on March 25.
On March 23, Ontario Premier Doug Ford announced that the province will take enforcement action to keep non-essential workplaces closed. A specific list of workplaces that must close is set to be released on March 24.
In place of its 2020 budget, Ontario announced $17 billion over the next year in its economic and fiscal update. The measures include $10 billion in tax and deferrals for individuals and businesses.
Quebec is earmarking at least $2.5 billion to help companies impacted by the pandemic. All industries are eligible for the emergency program, and businesses must demonstrate that they will be able to turn a profit after the outbreak.
Low-interest loans and loan guarantees of at least $50,000 will be offered to businesses as part of this plan. The government said it is open to providing more, based on the needs of businesses.
On Thursday, Investissement Québec was in the process of evaluating more than 600 requests for financial assistance. The government agency will also loosen terms for existing borrowers. Quebec is also extending the deadline for individuals and businesses to pay any tax balance due and tax installments to September 1, which is expected to inject $8.3 billion into the province’s economy.
On March 23, Quebec Premier Francois Legault ordered all businesses to close by the evening of March 24, for three weeks, with essential services remaining open.
Behind many of its fellow provinces, the Government of British Columbia announced a relief plan for businesses and residents on March 23.
The BC government will provide $5 billion, including a $2.8 billion financial relief package for residents and $2.2 billion for businesses. The plan also includes a one-time, tax-free $1,000 payment to residents whose employment is affected by the pandemic. The payment will be provided to individuals who receive federal Employment Insurance, or the new federal Emergency Care Benefit or Emergency Support Benefit.
Businesses with a payroll over $500,000 can now defer employer health tax payments until September 30, 2020 (businesses with a payroll under this threshold are already exempt). British Columbia is also extending tax filing and payment deadlines, including for PST, until the same date. The scheduled April 1 increase to the provincial carbon tax, as well as the new PST registration requirements on e-commerce, will be delayed and reviewed.
BC Finance Minister Carole James called the relief plan a starting point, with more updates expected over time.
In the meantime, the British Columbia Economic Development Association, a professional association of economic development practitioners in the province, has been providing informational resources to local, Indigenous, and regional governments as well as businesses. Some of the resources include a planning guide for businesses, workplaces, and employers, as well as a toolkit for economic preparedness in British Columbia.
Small Business BC, an organization that provides business advisory services and resources, has forwarded recommendations to the provincial government, including extending the April 30 tax deadline.
The province is also working with banks, credit unions, and other lenders, such as Community Futures, an agency that helps entrepreneurs start and expand their businesses with financing, to offer more credit options.
BC announced March 26 that it is establishing a new provincial supply chain coordination unit to coordinate distribution, and plans to take a more active role in coordinating essential goods and services movement by land, air, marine, and rail. The province will also suspend any bylaws that restrict goods delivery, allowing for delivery at any time of day.
The government is also banning the secondary resale of food, medical supplies, personal protective equipment, cleaning, and other essential supplies, and is restricting quantities of items purchased at point of sale. Local governments are also being directed to develop business continuity plans.
As part of its COVID-19 Action Plan, the BC government announced a total of $5 billion in income support, tax relief, and direct funding for people, businesses, and services. Businesses will have access to $2.2 billion earmarked to support recovery after the outbreak. The provincial government is partnering with business and labour leaders to build an economic stimulus plan. The province has allocated $1.5 billion for economic recovery.
The Alberta government is providing a postponement of corporate income tax balances and installment payments to August 31. Small commercial customers can also postpone electricity and natural gas payments for the next 90 days.
The province is making changes to its Employment Standards Code to allow full and part-time employees to take two weeks of job-protected leave if they must self-isolate or are caring for a dependent that is required to self-isolate.
Small businesses can apply for a deferral on loans and lines of credit for up to six months and can access additional working capital through ATB Financial. Businesses of all sizes can access one-on-one support from ATB Financial. Further solutions are also being considered by the province.
On March 23, Alberta’s government reversed the increase to the education property tax introduced in the 2020 budget, a move that is meant to help business owners save $32 million. The province will also defer its portion of six months worth of taxes on non-residential properties, delaying those taxes until October 2020. Alberta Premier Jason Kenney also announced changes to Workers Compensation Board premiums for businesses of all sizes, with private-sector business payments deferred until the end of this year.
Small and medium-sized businesses will only have to pay half of their 2020 premiums, with the government covering the other half. The government noted that employers who have already paid some of their premiums can request refunds or can have a credit put on their account.
Small and medium-sized businesses in Nova Scotia will have access to $161 million to help them overcome the impacts of COVID-19. The government is also deferring government loans and business-related fees until the end of June, as well as payments and interest on loans under the Jobs Fund, Housing Nova Scotia, and Municipal Finance Corporation.
Businesses will also not be required to pay workers compensation premiums until July. Loan payment deadlines under the Small Business Loan Guarantee Program administered through the Nova Scotia credit unions will be postponed until June 30. The province is also allowing businesses to apply for up to $500,000 through the Small Business Loan Guarantee program.
On March 19, the New Brunswick provincial government declared a state of emergency, essentially closing the majority of non-essential businesses.
Business property taxes are required to be paid by May 31, but the province will review late penalties on a case-by-case basis to determine whether the penalty can be waived for financial challenges caused by business closures during COVID-19. Banks are also working with small businesses to manage unexpected challenges, which could include relief to other credit programs offered by the provincial government.
The Saskatchewan government’s financial support plan includes a program that will offer residents not already covered by the federal government’s employment insurance programs, with $450 a week for up to two weeks.
The province’s plan also includes a three-month provincial sales tax remittance postponement and audit suspension. Businesses in the province that are not able to pay their PST due to cash flow issues will not have to pay any penalties or interest charges.
Businesses that cannot file their provincial tax returns on time can request relief, and the province’s audit program and compliance activities have been temporarily paused. The plan also includes a utility deferral program, which waives interest on late payments for up to six months.
The Manitoba government is providing businesses with the ability to defer payment of payroll taxes and provincial PST remittance up to $10,000 for 60 days. The province will work with businesses of all sizes regarding flexible repayment options above the $10,000 cap.
Prince Edward Island
Prince Edward Island has established a $25 million contingency fund to support resident workers impacted by COVID-19. The government has also established a toll-free support line for Island businesses: 1-866-222-1751.
Newfoundland & Labrador
On March 18, the province’s Minister of Health and Community Services declared COVID-19 a public health emergency under the Public Health Protection and Promotion Act. Across the region, businesses like bars, gyms, arenas, and libraries have closed.
No business supports have been announced by the province.
Image source Unsplash. Photo by Cris DiNoto.