October 13, 2020 Update: Economic Response for Second Wave
Canada’s COVID-19 Economic Response for the Second Wave
On October 9, 2020, the federal government announced further economic support to help businesses and other organizations that have been significantly impacted by COVID-19.
Canada Emergency Rent Subsidy
The Canada Emergency Rent Subsidy will cover up to 65% of rent or mortgage interest for businesses that have experienced a revenue decline of 70% or more. For businesses that have experienced a revenue decline of less than 70%, the rent subsidy will be scaled back based on the amount of the revenue decline.
This subsidy will be available retroactively for the period that began September 27, 2020 and ends October 24, 2020 and will be available until June 2021. This program will replace the Canada Emergency Commercial Rent Assistance program that expired in September.
The government also introduced a top-up Canada Emergency Rent Subsidy that will cover 25% of an organizations eligible rent if they are required to temporarily shut down due to a mandatory public health order and have a revenue shortfall.
The government will be introducing legislation that will implement the Canada Emergency Rent Subsidy soon.
Canada Emergency Wage Subsidy (CEWS)
The government announced that it will be extending the CEWS to June 2021. The government also announced that the maximum subsidy amount will be frozen at 65% of eligible wages until December 19, 2020. The maximum subsidy amount was scheduled to decrease to 45% of eligible wages on October 25, 2020. The government plans to introduce legislation to implement the changes soon.
Canada Emergency Business Account (CEBA)
The CEBA is being expanded to allow businesses who have already qualified for the $40,000 CEBA loan to access an additional $20,000 based on needs. $10,000 of the additional $20,000 loan will be forgivable if the loan is repaid by December 31, 2022. The application deadline for CEBA loans is also being extended to December 31, 2020.
To qualify, business will have to attest to revenue declines due to COVID-19. The government will be providing more details on when and how to access the additional CEBA in the coming days.