The Trudeau government has proposed an $82 billion support package to help Canadians deal with the economic effects of the Corona outbreak. To understand this in perspective, it is equal to almost a quarter of the federal budget and over 3% of our GDP. $27 billion will be in direct support of Canadian workers and businesses. $55 billion is provided to meet liquidity needs of Canadian businesses and households through tax deferrals. The Prime Minister said that as “significant” as this package is, “...the government is prepared to do more.”
Illness benefits beyond EI
For Canadians without paid sick leave or access to Employment Insurance sickness benefits, the government is introducing a new Emergency Care Benefit that will provide up to $900 bi-weekly for up to 15 weeks. The benefit, which the government estimates could cost up to $10 billion, is for workers who must self-isolate, those who are caring for a family member sick with COVID-19 and parents who are unable to earn income while schools are closed as a result of childcare duties.Applications for the benefit will be available in April.
Unemployment benefits beyond EI
The Canada Revenue Agency will provide up to $5 billion for unemployed workers without access to EI through a new Emergency Support Benefit. Ottawa will also be extending income supports to workers who lose their jobs or see their hours reduced as a result of the pandemic.
To help prevent lay-offs, the government is also considering a measure that would provide businesses struggling with the economic impact of COVID-19 with a subsidy equal to 10 per cent of employee wages, up to $1,375 per employees and $25,000 per employer.
The Prime Minister said Ottawa will also temporarily boost the Canada Child Benefit (CBB) over the coming months. The government is proposing to boost the maximum annual CBB payment amounts by $300 per child for the 2019-2020 benefit year.
Families receiving the CBB will get an extra $300 per child as part of their May payment, the government said.
Ottawa will also double the maximum annual Goods and Services Tax Credit (GSTC), providing an average income boost of $400 for low-income income individuals and close to $600 for couples. Finance Minister Morneau said single parents could be eligible for up to $1,500 in support from the two measures combined.
Tax deadline postponed
Ottawa is moving the tax-filing deadline from April 30 to June 1 for individuals as Premier Legault did in Quebec earlier this week. And Canadians who owe taxes will be allowed to postpone payment until August 31.
Moratorium on student loan payments
The government has also proposed a six-month, interest-free moratorium on the repayment of federal student loans.
Help for businesses
Ottawa will allow businesses to defer payments of income tax amounts until after Aug. 31. No interest or penalties will accumulate. The government will also increase the tax credits available to small, medium and large businesses. The new Business Credit Availability Program will provide more than $10 billion in additional support to businesses through the Business Development Bank of Canada and Export Development Canada.
The government will also launch an Insured Mortgage Protection Program to purchase up to $50 billion of insured mortgage pools through CMHC. The Government will do this by raising CMHC’s legislative limits to guarantee securities and insure mortgages by $150 billion each.
The government is expected to recall Parliament the week of the 24th to pass this program.