Finance Minister Bill Morneau released details Wednesday about the federal government’s wage subsidy program for large and small businesses, including its roughly $71-billion price tag.
The benefit will pay 75% of the first $58,700 normally earned by employees, up to $847 per week. The subsidy is expected to last for three months — retroactive from March 15 to June 6.
The funds will start to flow in about six weeks, Morneau said. There is no overall limit on the subsidy amount that an eligible employer may claim.
Employers who can show their revenues have fallen by at least 30% in March, April or May compared to the same month last year will be eligible.
Morneau said the government will continue to reassess the situation as the crisis unfolds and is open to adding new measures as necessary.
The Canadian Federation of Independent Business (CFIB) said Wednesday that many businesses won’t be able to demonstrate that their monthly revenue has declined by 30% year over year.
“New businesses, seasonal businesses and those who experienced a major event last year at this time would find it challenging or impossible to demonstrate the 30% decline figure,” the CFIB said in a statement.
The CFIB also said a 30% threshold is too high for firms with “very tight profit margins.”
The organization added that making businesses wait another six weeks for relief is too long, since many businesses are “facing cash flow emergencies now.”
The benefit program would exclude revenues from extraordinary items and amounts on account of capital, a department backgrounder said. Eligible remuneration does not include severance pay or other items such as stock option benefits or the personal use of a corporate vehicle.
Employers can apply for the benefit through the Canada Revenue Agency’s My Business Account portal. Read the full departmental backgrounder here.