In response to the COVID-19 global pandemic, the federal government rolled out a number of support programs over the last 18 months such as the Canada Emergency Wage Subsidy (CEWS), Canada Emergency Rent Subsidy (CERS), Lockdown Support and Canada Recovery Hiring Program (CRHP). All programs except for the CRHP were due to expire on October 23, 2021.
In an announcement on October 21, 2021, the federal government committed to extending the current CHRP to until May 7, 2022, and to providing more targeted assistance with two new programs:
- The Tourism and Hospitality Recovery Program
- The Hardest-Hit Business Recovery Program.
The Tourism and Hospitality Recovery Program
Under this new program, hotels, festivals, restaurants, bars, tour operators and travel agencies are all examples of organizations that will be eligible for support. A detailed list of eligible organizations is forthcoming.
To qualify for support, organizations must meet both of the following criteria:
- Current month revenue loss of at least 40%; and
- An average revenue reduction of at least 40% over the first 13 qualifying periods for the CEWS (March 2020 to February 2021).
Revenue decline is calculated in the same manner that is currently used for the CEWS program.
Under this program, the maximum subsidy rate for wage and rent subsidies will be set at 75% from October 24, 2021 to March 12, 2022 (claim periods 22 to 26). The rent and subsidy rates will then be reduced by half from March 13 to May 7, 2022 (claim periods 27 and 28). The table below shows the subsidy rate structure:
| Current-Month Revenue Decline | Subsidy Rate October 24, 2021 – March 12, 2022 (Claim Periods 22-26) | Subsidy Rate March 13 – May 7, 2022 (Claim Periods 27-28) |
| 75% and over | 75% | 37.5% |
| 40-74% | Revenue decline (e.g., 60% revenue decline = 60% subsidy rate) | Revenue decline ÷ 2 (e.g., 60% revenue decline ÷ 2 = 30% subsidy rate) |
Hardest-Hit Business Recovery Program
For businesses that are struggling because of the pandemic, but don’t qualify for the tourism and hospitality recovery program could qualify for rent and wage subsidy support under the Hardest-Hit Business Recovery Program.
To qualify for support, organizations must meet both of the following criteria:
- A current month revenue loss of at least 50%; and
- An average monthly revenue reduction of at least 50% over the first 13 qualifying periods for the CEWS (March 2020 to February 2021).
Revenue decline is calculated in the same manner that is currently used for the CEWS program.
Under this program, the maximum subsidy rate for wage and rent subsidies will be set at 50% for eligible organizations for the period October 24, 2021 to March 12, 2022 (claim periods 22 to 26.) The rent and subsidy rates will then be reduced by half from March 13 to May 7, 2022 (claim periods 27 and 28). The table below shows the subsidy rate structure:
| Current-Month Revenue Decline | Subsidy Rate October 24, 2021 – March 12, 2022 (Claim Periods 22-26) | Subsidy Rate March 13 – May 7, 2022 |
| 75% and over | 50% | 25% |
| 50-74% | 10% + (revenue decline – 50%) x 1.6 (e.g., 10% + (60% revenue decline – 50%) x 1.6 = 26% subsidy rate) | 5% + (revenue decline – 50%) x 0.8 (e.g., 5% + (60% revenue decline – 50%) x 0.8 = 13% subsidy rate) |
Public Health Lockdown Assistance
In recognition of the challenges that occur because of public health restrictions placed on organizations, the government announced that businesses would be eligible for support at the subsidy rates calculated in the tourism and hospitality recovery program, irrespective of sector. To qualify, the health restrictions that are in place must cause the business to cease activities that accounted for at least 25% of total revenues during the prior reference period.
Changes to CERS
Under current rules in place for the CERS, there is a monthly cap on eligible expenses of $75,000 per location and $300,000 in total for all locations. The government is proposing to increase the aggregate monthly cap on eligible expenses that can be claimed from $300,000 to $1,000,000 for businesses that qualify for the rent subsidy under the Tourism and Hospitality Recovery Program and Hardest-Hit Business Recovery Program.
CRHP Extended and Subsidy Rate Increased
The CRHP was set to expire on November 20, 2021, but the government is proposing to extend this program until May 7, 2022. Beginning October 24, 2021, they also plan to increase the subsidy rate from 20%, as it currently stands, to 50%.
Please contact us if you would like more information or to discuss your situation.