Some Federal and Provincial/Territorial Financial Relief Measures Relating to COVID-19

9 April 2020, 8:45 a.m.

(Disponible en français : Quelques mesures de soutien financier des gouvernements fédéral, provinciaux et territoriaux concernant la COVID-19)

The outbreak of the novel coronavirus (COVID-19) is causing financial strain across Canada. This HillNote provides an overview of some measures by federal, provincial and territorial governments to address the financial impact of COVID-19 on individuals, on communities and on businesses.

1. Measures for Individuals and Communities

Table 1 shows the programs that various governments have announced to support individuals and communities during the outbreak.

Table 1 – Measures for Individuals and Communities (as of 8 April 2020)

 

Income Support and
Tax Deferral 

Student Loan
Deferral

Mortgage and Other
Loan Deferrals

Support for Low-Income Households
and Other Identified Groups 

Federal 

X

X

X

X

British Columbia

X

X

X

Alberta

X

X

X

X

Saskatchewan

X

X

X

X

Manitoba

X

Ontario

X

X

X

Quebec

X

X

X

New Brunswick

X

X

X

Nova Scotia

X

X

X

Prince Edward Island

X

X

Newfoundland and Labrador

X

X

Yukon

X

X

Northwest Territories

X

X

X

Nunavut

Source: Table prepared by the authors using the sources linked throughout this document.

1.1. Income Support and Tax Deferral

Several governments across Canada are introducing or expanding sickness benefits for employees who self-isolate or are in quarantine because of COVID-19. This support will be disbursed in paid sick leave or by direct payments. Jurisdictions such as Alberta have changed their labour codes to provide job-leave protection. 

There are new temporary emergency programs for workers, such as federal support for workers who lose income due to the pandemic. Prince Edward Island is offering support for self-employed workers and workers receiving fewer hours.

Several jurisdictions have announced additional income assistance for persons already receiving government support payments, such as the federal Canada Child Benefit. Most of this assistance will be disbursed as a temporary increase to existing programs. Some provinces are providing one-time payments, such as Ontario’s support to offset school and daycare closures.

In addition, the new deadline to file personal income tax returns has been extended to 1 June 2020 across Canada. The deadline for self-employed individuals to file income tax returns remains 15 June 2020. However, in both cases, the deadline for paying amounts due has been extended until after 31 August 2020.

1.2. Loan Payment Deferral

To lessen the impact of COVID-19 on personal finances, the federal government and some provincial and territorial governments have announced measures regarding the repayment of loans. 

A six-month interest-free student loan repayment moratorium has been announced by the federal government and various provinces, including Alberta, British Columbia, Saskatchewan, Ontario, Québec, Nova Scotia and the Northwest Territories

The federal government has announced similar measures for mortgage holders. The COVID-19 Mortgage Payment Deferral program permits the deferral of mortgage payments on Canada Mortgage and Housing Corporation–insured mortgage loans for up to six months. As well, the federal government has urged Canada’s large banks to provide financial assistance to their customers, not only through deferred mortgage payments, but also through relief on other credit products. 

1.3. Low-Income Households and Other Identified Groups

Governments have recognized the unique barriers to certain populations in meeting their basic needs during the outbreak. Many have increased support to low-income households and other identified groups, including Indigenous peoples, seniors, women and children.

These targeted initiatives vary widely. The federal government has increased the amount of its Goods and Services Tax Credit and has announced a new fund to meet Indigenous communities’ immediate needs. Both the federal government and Quebec are easing registered retirement income fund rules to reduce the impact of declining stock values on retirees.

Various jurisdictions, including British Columbia, Alberta, Saskatchewan, Ontario, Quebec and New Brunswick have implemented a utility payment holiday for individuals and/or businesses. Provinces such as British Columbia, Saskatchewan, Manitoba, and Newfoundland and Labrador have also introduced a moratorium on evictions for non-payment of rent. The Northwest Territories is allowing non-government organizations, Indigenous governments and community governments to carry unspent contribution amounts into the next fiscal year.

2. Measures for Businesses

Table 2 shows measures that governments have implemented to support businesses following the outbreak.

Table 2 – Measures for Businesses (as of 8 April 2020)

 

Tax and Contribution
Payment Deferral 

  Loan Payment Deferral,
Access to Credit
and Market Liquidity

Sector-Specific
Measures

Federal 

X

X

X

British Columbia

X

X

Alberta

X

X

Saskatchewan

X

X

Manitoba

X

X

Ontario 

X

X

Quebec

X

X

New Brunswick

X

X

Nova Scotia

X

X

Prince Edward Island

X

X

Newfoundland and Labrador
Yukon

X

X

Northwest Territories

X

X

Nunavut

Source: Table prepared by the authors using the sources linked throughout this document.

2.1. Tax and Contribution Payment Deferral

In response to COVID-19, several governments will improve cash flows for businesses through tax and other deferrals. Programs offered by Alberta, Ontario, New Brunswick, Nova Scotia, the Northwest Territories and Yukon include the deferral and reimbursement of worker safety compensation paid by businesses and interest- and penalty-free deferral for businesses to make payments for provincially administered taxes such as the Employer Health Tax and Tobacco Tax.

The tax filing deadlines for corporations remain unchanged. However, businesses can defer paying amounts due until 30 June 2020 or after 31 August 2020, depending on the type of tax. In Saskatchewan, businesses that are unable to file their taxes can request relief from penalty for the income and provincial sales taxes owing.

2.2. Loan Payment Deferral, Access to Credit and Market Liquidity

To provide access to credit for businesses during the outbreak, various governments have announced financing programs to facilitate lending and loan payment. 

Financial Crown corporations across Canada, including ATB (Alberta), Finance PEI, Island Investment Development Inc., and the PEI Century Fund (Prince Edward Island), and BDIC (the Northwest Territories), are providing loan payment deferral options to small businesses. A three-month moratorium [in french only] has also been put in place for the repayment of loans already granted through Québec’s Fonds local d’investissement. 

Some governments have announced financing programs to provide loans and loan guarantees. The federal Business Credit Availability Program will provide additional financing to businesses. Measures at the provincial and territorial level include Prince Edward Island’s Emergency Working Capital Financing program and Investissement Québec’s Concerted temporary action program for businesses

Moreover, the federal government has announced that it will purchase up to $50 billion in insured mortgage pools through the Canada Mortgage and Housing Corporation. It is also providing eligible small employers with a temporary wage subsidy and extending the Work Share Program to help avoid layoffs. In provinces such as Ontario, new tax exemptions and credits will provide liquidity.

2.3. Sector-Specific Measures

Some governments have introduced measures to address outbreak-related challenges experienced by specific sectors. For example, the federal government has expanded the agri-food industry’s access to loans. Provinces such as British Columbia and Manitoba have announced financial support for childcare providers who face reduced enrolment or have been forced to close. Alberta is supporting the energy industry by paying industries’ annual regulator fees and extending the terms of mineral agreements.

Authors: Ryan van den Berg, Anne-Marie Therrien-Tremblay and Andrew Barton, Library of Parliament