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Federal Government Expands Eligibility for the Local Lockdown Program to Businesses
The government’s new regulations will expand the Local Lockdown Program to:
- Include employers subject to capacity-limiting restrictions of 50% or more; and
- Reduce the current-month revenue decline threshold requirement from 40% to 25%.
Eligible employers will receive wage and rent subsidies from 25% up to a maximum of 75%, depending on their degree of revenue loss. Employers would continue to need to demonstrate current-month losses only, without the requirement for a historical 12-month revenue decline.
The rate would start at 25% for eligible organizations with a 25% current-month revenue decline, increasing in proportion to current-month revenue loss up to a maximum rate of 75% for those with a current-month revenue decline of 75% or higher.
The updated regulations will apply from December 19, 2021, to February 12, 2022, during which time it is expected that public health authorities will continue to implement “circuit-breaker” restrictions that limit the spread of the Omicron variant of COVID-19 across Canada.
More details on the expansion of these support measures are available on the Department of Finance website.
Ontario Government Announces New Supports for Businesses Impacted by Omicron-Related Public Health Measures
The Ontario government is introducing new supports for many of the businesses that are most impacted by public health measures in response to the Omicron variant. These supports include a new Ontario Business Costs Rebate Program and a six-month interest- and penalty-free period to make payments for most provincially administered taxes.
Through the new Ontario Business Costs Rebate Program, eligible businesses will receive rebate payments equivalent to 50 per cent of the property tax and energy costs they incur while subject to the current capacity limits. This will provide support to businesses that are expected to be most impacted financially by the requirement to reduce capacity to 50 per cent. Examples of businesses that will be eligible for the Ontario Business Costs Rebate Program include restaurants, smaller retail stores and gyms. A full list of eligible business types will be made available through a program guide in mid-January 2022.
Online applications for this program will open in mid-January 2022, with payments to eligible businesses provided retroactive to December 19, 2021. Businesses will be required to submit property tax and energy bills as part of the application process.
The province is also providing additional support to help improve cash flows for Ontario businesses by providing a six-month interest- and penalty-free period to make payments for most provincially administered taxes, supporting businesses in the immediate term while capacity restrictions are in place while providing the flexibility Ontario businesses will need for long-term planning. The six-month period will begin January 1, 2022 and end July 1, 2022.
Examples of Ontario taxes businesses can delay payments on to free up cash flow include:
- Beer, Wine & Spirits Taxes
- Tobacco Tax
- Insurance Premium Tax
- Fuel Tax
- International Fuel Tax Agreement
- Gas Tax
- Retail Sales Tax on Insurance Contracts & Benefit Plans
- Mining Tax
- Race Tracks Tax
More details on this new support for businesses are available on the Ontario Government website.
Quebec Government Announces Extension of Financial Assistance and Moratorium on Repayment Plans
Businesses subject to a closure order starting from December 20, 2021 to protect the health of the population in the context of the COVID-19 pandemic can again submit a financial assistance application under the Assistance for Businesses in Regions on Maximum Alert (AERAM) section of the Emergency Assistance Program for Small and Medium-Sized Businesses (PAUPME).
Applications for financial assistance under the AERAM section must be received no later than four weeks after the resumption of the operations of the businesses subject to a closure order.
Moreover, the moratorium on the repayment of principal and interest related to the financial assistance granted under the PAUPME can be extended until March 31, 2022.
More details on this new support for businesses are available on the Quebec Government website.
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