Canada’s Government Assistance Programs for SMBs Compared to Foreign Governments

COVID-19 fallout could force 1 in 4 small businesses to close doors permanently.

Ottawa has responded with a stimulus package that included a wage subsidy, tax deferrals and billions in credit to keep SMBs afloat during this massive cashflow crisis.

Please read the CLA’s Open Letter to Government, which outlines further actions that can be taken in order to support Canadian SMBs.

Below is a breakdown of Canada’s SMB stimulus package. We compare each measure to a similar one implemented by a foreign government.

Wage subsidy: 75% wage subsidy for qualifying businesses, for up to 3 months, retroactive to March 15, 2020.

  • Denmark: gov will cover 75% of the wages up to about $5,000 a month.
  • New Zealand: gov will cover $585 / week / full time employee for 12 weeks.
  • UK: gov will cover 80% of wages up to £2,500 a month cap – initially for the next 3 months, but for longer if needed.

Emergency benefit: Taxable benefit of $2,000 a month for up to 4 months for staff who must stay home due to illness, childcare, nursing sick family members for up to 15 weeks

  • New Zealand: $585.80 / week for full-time and $350 / week for part-time workers.

Interest-free loans: Up to $40,000 in interest-free loans to small businesses and not-for-profit companies.

Defer tax filing: Businesses can defer the payment of any income tax amounts that become owing on or after today and before September 2020. The government will defer GST, HST, and customs duties until June 30, 2020.

Small Business Loan: Low-interest loans up to $2 million if your business has been generating revenues for at least 24 months.

  • USA: Low-interest loans up to $2 million through the Small Business Administration (SBA).
  • Japan: 100% guarantee on loans if year-over-year sales decrease by more than 20%, and 80% if year-over-year sales decrease by 5%.
  • UK: loan guarantee program via BBB which will be facilitated by fintech lenders.
  • Hong Kong: Low-interest loan up to $2 million with a 100% government guarantee for enterprises, which will be open for application for 6 months.

Purchase order financing: Cover up to 90% of the purchase order amount to ease cash flow to your suppliers.

 

Please read the CLA’s Open Letter to Government, which outlines further actions that can be taken in order to support Canadian SMBs.

This page will be updated as more details on Canadian and foreign aid packages are announced.