Budget 2021 investments will create jobs and growth by supporting small business

From: Department of Finance Canada

Throughout the pandemic many small businesses have been shut down by necessary public health restrictions or deeply limited in what they can do. We need them to get back on their feet. They are the backbone of our economy, our main streets, and our communities.

The economic situation remains uneven and Budget 2021 is making targeted investments in Canada’s small businesses so they can come roaring back, hire workers, innovate, and ensure resilient long-term growth.

To help Canadian businesses, including small and medium-sized businesses, bridge through to recovery, Budget 2021 proposes to extend the Canada Emergency Wage Subsidy, the Canada Emergency Rent Subsidy, and Lockdown Support past June, to give businesses certainty in the months ahead. This will continue to protect millions of jobs and help businesses stay well positioned for a robust recovery. Budget 2021 also introduces the new Canada Recovery Hiring Program to help eligible employers offset a portion of the extra costs they take on as they reopen and increase workers’ wages or hours worked, or hire more people.

To help small businesses and entrepreneurs access the capital they need to recover, innovate, and grow in the long-term, Budget 2021 has a plan to enhance the Canada Small Business Financing Program by increasing annual funding so that it can support thousands more small businesses.

Budget 2021 also has a plan to lower the cost of doing business by reducing credit card transaction fees. Canada’s small and medium-sized businesses incur some of the highest fees in the world. The government will engage with key stakeholders to lower the average overall cost of fees, ensure small businesses pay a price similar to large businesses, and protect consumers’ rewards points.

More and more, business is happening online. To help small businesses adapt, recover, and stay competitive, Budget 2021 introduces the Canada Digital Adoption Program, which will create thousands of jobs for young Canadians and help as many as 160,000 small and medium-sized businesses adopt new digital technologies.

Quotes

“Small businesses are the bustling, thriving heart of our economy. They are the spine of Main Street in every city, town and village in Canada. And while many big, multinational companies have actually prospered during this low-interest rate COVID year, our small businesses have been battered. Healing the wounds of COVID-19 requires a rescue plan for them.”

The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance

Quick facts

  • Budget 2021’s proposed investments will make targeted investments in Canada’s businesses so they can come back stronger than ever before. Key measures include:

    • Extending the Canada Emergency Wage Subsidy, the Canada Emergency Rent Subsidy, and Lockdown Support until September 25, 2021. It also proposes to gradually decrease the rates for the wage subsidy and rent subsidy, beginning July 4, 2021, in order to ensure an orderly phase-out of the programs as vaccination progress continues and the economy reopens. The government will also seek the legislative authority to have the ability to further extend the wage subsidy program through regulations until November 20, 2021, should the economic and public health situation require it beyond September 2021.
    • Extending the application deadline for similar support to the Canada Emergency Business Account under the Regional Relief and Recovery Fund and the Indigenous Business Initiative until June 30, 2021. This includes:
      • Providing up to $80 million in 2021-22, on a cash basis, for the Community Futures Network of Canada and regional development agencies, and shifting remaining funds under the Indigenous Business Initiative into 2021-22, to support the extended application deadlines. This would support small businesses in rural communities.
    • Introducing the new Canada Recovery Hiring Program for eligible employers that continue to experience qualifying declines in revenues relative to before the pandemic. This support would only be available for active employees and will be available from June 6 to November 20, 2021. Eligible employers would claim the higher of the Canada Emergency Wage Subsidy or the new proposed subsidy. The aim is to make it as easy as possible for businesses to hire new workers as the economy reopens.
    • Improving the Canada Small Business Financing Program through amendments to the Canada Small Business Financing Act and its regulations. These proposed amendments are projected to increase annual financing by $560 million, supporting approximately 2,900 additional small businesses.
    • Allowing the immediate expensing of $1.5 million of eligible investments by Canadian-controlled private corporations, to help Canadians businesses invest in new technologies and move forward with capital projects, accelerating Canada’s recovery and helping free up capital that businesses can use to create good jobs.
    • Providing $700 million over three years, starting in 2021-22, for the regional development agencies to support business financing. This would position local economies for long-term growth by transitioning to a green economy, fostering an inclusive recovery, enhancing competitiveness, and creating jobs in every corner of the country.
    • Creating a new agency for British Columbia and to provide $553.1 million over five years, starting in 2021-22, and $110.6 million ongoing, to support the new agency and ensure businesses in B.C. can grow and create good jobs for British Columbians.
    • Allocating $21 million over three years to support the removal of barriers to trade between provinces and territories, which will help build a more prosperous economy-creating jobs, fueling business expansion, expanding consumer choice of Canadian goods and services, and helping regional economies grow.
    • Providing an addition $1 billion over six years to the Universal Broadband Fund so that households and small businesses in rural communities have faster, more reliable internet connections.
    • Investing $500 million over two years for community infrastructure projects on main streets, in farmers’ markets, and other gathering places that underpin local economies.
    • Revitalizing Canada’s tourism sector, which is made up of many small businesses, through $1 billion to help tourism businesses recover and support festivals and cultural events that provide jobs and growth in many of our cities and communities.

/Public Release. This material comes from the originating organization and may be of a point-in-time nature, edited for clarity, style and length. View in full here.