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TORONTO – Law C-9, the latest COVID-19 aid law, was passed in the Senate this week, extending federal wage subsidy and introducing a new commercial rental subsidy program, as concerns over companies facing a new round of closures in the midst of a second wave of pandemics.
The legislation was speeded up by the House of Commons in the first week of November and received royal consensus on Thursday after being adopted at a third reading in the Senate.
Here’s what it means for Canadians:
ADDRESSING THE DIFFERENCES IN RENTAL GRANTS FOR BUSINESSES
Canada Emergency Rent Subsidy (ESRB) will provide new rents and mortgage interest support to qualified tenants and property owners until June 2021.
The new ESRB covers up to 65% of eligible expenses for businesses, charities and non-profit organizations that have been affected by the pandemic. This includes rent, property taxes, insurance and corporate mortgage interest through December 19.
The ESRB replaces the former Canada Emergency Commercial Rent Assistance (CECRA) program, which came under harsh criticism from business owners for requiring commercial property owners to apply for loans rather than the businesses themselves.
The new legislation provides funds directly to tenants and property owners, regardless of their owner’s participation.
However, a provision in Act C-9 that would require business owners to pay rent before receiving funding has already drawn criticism from the Canadian Federation of Independent Business (CFIB). The industry group notes that some entrepreneurs would automatically be excluded due to the cash flow difficulties they are already facing.
Deputy Prime Minister and Finance Minister Chrystia Freeland said last week that the feds will present a new law to address the issue once the C-9 law is passed.
NEW SUPPORTS FOR LOCKDOWN
The new Lockdown Support will provide additional funds to organizations that are subject to a lockdown and need to close their doors or significantly restrict their business under the public health order (including orders placed by a municipality or health authority regional under one of those laws).
Companies forced to close their doors will be entitled to a top-up of 25%. Complaints can be submitted retroactively until September 27, 2020.
Combined with the ESRB, this means that companies affected by a blockade could receive up to 90% rent support.
EXTENDED EMERGENCY WAGE GRANT
Bill C-9 also provides for the extension of the Canadian Emergency Wage Subsidy (CEWS) until June 2021, keeping the current maximum subsidy rate at 65% of eligible wages until December 19, 2020.
Under the previous wage subsidy program, eligible employers were subject to a 30% drop in revenue measurement, allowing them a 75% payroll subsidy.
Under the new legislation, any company with a decline in revenue will be eligible. The grant will be proportional to the decline in revenue, up to a maximum of 65% of eligible wages.
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