COVID-19 Tax Update: Government Extends CEWS until December 2020 and Revamps Eligibility Criteria
On July 17, 2020, the Department of Finance released draft legislative proposals (link) providing further relief related to COVID-19. Included were extensive revisions to the CEWS rules to, among other things:
- extend the CEWS program until at least November 21, 2020;
- extend the application deadline from September 30, 2020 to January 31, 2021;
- ease the revenue reduction percentage required to access the program (with the subsidy amount calculated on a sliding scale);
- gradually phase-out the maximum subsidy rate;
- add continuity rules regarding mid-year business acquisitions and amalgamations;
- introduce rules for “payroll service providers”; and
- going forward, remove the requirement that eligible employees not be without remuneration for 14 consecutive days.
The proposed amendments are highly complex and represent a substantial revamp of the CEWS program. We are preparing a blog post with additional details regarding the proposals. In the meantime, read our earlier in-depth blog on the CEWS here.
Finally, the draft legislative proposals also resurrect the provisions originally contained in Bill C-17 providing for the suspension or extension of certain time limits under, among other statutes, the Income Tax Act (Canada) – see our earlier blog including a discussion of those measures here.