TORONTO, April 8, 2020 /CNW/ - The Canadian Federation of Independent Business (CFIB) is pleased to learn the government is planning important changes to the Canada Emergency Wage Subsidy. CFIB shared the results of a major survey of its members which showed many small firms were concerned with the requirement for businesses to demonstrate a 30 per cent reduction in gross revenues before they would be able to access the subsidy.
Based on our initial review, it appears government will make three big fixes that will help many more SMEs access the program.
To access the subsidy in March, April and May 2020, a firm will be able to compare their sales to the same month last year OR January and February, 2020. This will help new and growing firms who may not have qualified based on a comparison to 2019.
CFIB heard concerns from many who would not qualify for a subsidy in March because they wouldn't be able to show a 30 per cent reduction as the first half of March was not yet deeply affected by the economic effects of COVID-19. The federal government will now require firms to demonstrate only a 15 per cent reduction in gross revenues for March. A 30 per cent reduction will still be required to receive the subsidy in April and May.
Some business reported that their regular accrual accounting method would mean their books would not show a loss of 30 per cent, despite a deep effect on cash flow. Now government is proposing to allow an option to use cash accounting.
To be clear, these changes will still not help all small firms in need of help to gain access to the subsidy. CFIB's preferred option remains that government drop the 30 per cent test altogether for small and medium-sized firms. The Federation will continue to lobby all parties for such a change. The changes will also not address the concerns of many who cannot afford to wait 3 to 6 weeks before receiving any support for their wage bills.
But based on our early review of these changes, we believe that thousands of additional small businesses will be able to access this program. CFIB urges all parties to quickly review and approve the legislation to ensure businesses can have confidence this much needed support measure will be in place as soon as possible.
- Dan Kelly, President, Canadian Federation of Independent Business (CFIB)
The Canadian Federation of Independent Business (CFIB) is Canada's largest association of small and medium-sized businesses with 110,000 members across every industry and region. CFIB is dedicated to increasing business owners' chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.
SOURCE Canadian Federation of Independent Business
For further information: For media enquiries or interviews, please contact: Milena Stanoeva, CFIB, 647-464-2814, [email protected]