The federal government does not have the back of new business owners
Toronto, May 18, 2021 – Tomorrow will mark a year since Prime Minister Trudeau publicly promised new businesses will have access to federal support, yet they remain shut out of all current programs, says the Canadian Federation of Independent Business (CFIB). CFIB is calling on the federal government to deliver on its promise, as tens of thousands of businesses that began formal operations after March 2020 continue to face a grueling stretch of new restrictions and lockdowns without any of the support available to other firms.
“Starting a business usually requires months, if not years, of planning, including major investments in a location, equipment and training staff,” said Dan Kelly, CFIB president. “After sinking their life’s savings into a business, the pandemic delayed many owners from opening their doors and when they finally did, they found themselves shut out of the wage subsidy, rent subsidy and CEBA loan program.”
On May 19, 2020, Prime Minister Trudeau promised to work on a potential solution for businesses that had not yet filed a tax return, such as newly created businesses.
“A full year after the Prime Minister promised small firms government would fix the problem for new business owners, they have not been able to receive a nickel of support. Some have been fully shut down by provincial orders for more than 300 days. As several provincial governments have found solutions to allow newer firms to access their more limited support programs, it is ridiculous that the federal government hasn’t delivered on its promise.”
New firms have been able to access support programs in many provinces, but that money is not enough to get them through the pandemic.
CFIB has outlined several approaches the federal government can take to provide support to new businesses in a letter to Deputy Prime Minister Chrystia Freeland, including:
- Waive the requirement for an active CRA Business Number (BN) on the first day of each COVID-19 relief program or allow a business to apply for one.
- As new firms are not able to determine their revenue loss compared to the same month in 2019 or January/February 2020, allow them to use provincial average revenue loss numbers by sector OR determine revenue comparisons based on an average sales revenue over a few recent months, as Saskatchewan has implemented.
- Allow new businesses that opened after March 1, 2020, to demonstrate a month-over-month revenue reduction when comparing a month between April 2020 and April 2021 to any month between November 2020 and April 2021.
- Allow new businesses to compare month-over-month revenues to the previous month (prior to increased restrictions).
“New businesses will be vital to Canada’s economic recovery, as they create new jobs and replace the businesses that we have lost. They face the same lockdowns as other businesses, and are often more fragile because they don’t yet have a list of loyal customers or any reserves after starting operations. We urge the federal government to deliver on the promise made a year ago and provide new businesses with the support they need,” concluded Kelly.
Small business owners can now sign CFIB’s petition calling on the government to provide support to new firms.
For media enquiries or interviews, please contact:
Milena Stanoeva, CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 95,000 members across every industry and region. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.