OTTAWA — Last Wednesday, Chrystia Freeland, Deputy Prime Minister and Minister of Finance, announced the following changes to the federal government’s Canada Emergency Business Account (CEBA) program:
- Extending the re-payment deadline for CEBA loans to qualify for partial forgiveness from Dec. 31, 2022 to Dec. 31, 2023.
- Re-payment on or before the new deadline of Dec. 31, 2023 will result in loan forgiveness of up to a third of the loan value (up to $20,000).
- Outstanding loans would subsequently convert to two-year term loans with interest of five per cent per annum starting Jan. 1, 2024. Loans will be fully due by Dec. 31, 2025.
- Extending the re-payment deadline for partial forgiveness for CEBA-equivalent lending through the Regional Relief and Recovery Fund to Dec. 31, 2023.
“Restaurants Canada welcomes this change in policy, as it responds to one of our key recommendations to the federal government to help hard-hit foodservice businesses survive and recover from the ongoing COVID-19 crisis,” says Restaurants Canada in a statement. “With most restaurants across the country now taking on even further debt in the face of the Omicron wave, ensuring they will have enough cash flow to continue their operations will become increasingly critical.”
“TIAO welcomes this announcement and thanks the government for its continued support and dedication to small businesses, specifically tourism businesses. The extension is a long-term TIAO advocacy ask,” says the Tourism Industry Association of Ontario (TIAO) in a statement. “However, since the start of the pandemic, about seven in 10 Ontario tourism businesses have taken on debt that will take at least two to three years to resolve. This month, almost half of the province’s tourism businesses reported a pessimistic outlook for the future of their business and that of the tourism industry. As such, while this extension will provide some relief, it will not be enough.
Tourism-and-hospitality business will continue to advocate for additional measures, such as:
- Permanently extending the current temporary amendments to the eligibility requirements for the rent and wage subsidies under the Local-Lockdown Program.
- Expanding the eligibility threshold for funds through the Tourism and Hospitality Recovery Program for businesses not subject to lockdown or capacity restrictions (starting at 10 per cent, instead of 40 per cent revenue decline, with a wage subsidy rate of up to 75 per cent).
- Tax credits or other sources of funding to cover costs associated with the COVID-19 pandemic.