Ottawa hikes wage subsidy to 75% for small and medium-sized businesses
The federal government is hiking its wage subsidy for small and medium-sized businesses from 10 per cent to 75 per cent, a move that business leaders have called for amid the coronavirus outbreak.
Prime Minister Justin Trudeau announced the payroll subsidy, as well several additional measures to support small businesses, on Friday.
“For those of you who’ve already had to lay off workers, we hope you will consider rehiring them given this payroll support.” – Justin Trudeau
Under Ottawa’s original $82 billion support package that was unveiled last week, small businesses could receive a 10 per cent wage subsidy for 90 days, up to a maximum of $1,375 per employee and $25,000 per employer. It is unclear whether the cap will change alongside the subsidy hike, or how long the subsidy will applicable.
Many businesses and industry groups had said the previous subsidy fell significantly short of providing assistance to small businesses that are struggling across the country.
The 75 per cent subsidy will be retroactive, and apply as of Sunday March 15.
The government also announced that it would launch a “Canada Emergency Business Account”, which will allow banks to offer $40,000 loans that are guaranteed by the government to qualifying businesses. The loan will be interest-free for the first year and, if certain conditions are met, $10,000 of that loan will be forgivable.
The government will provide an additional $12.5 billion to Export Development Canada and the Business Development Bank to help SMEs with operational cash flow requirements. GST and HST payments, as well as duties and taxes owed on imports, will be deferred until June.
News Source: www.yahoo.com/news