CEWS and CERS extended for capacity limits
Regulations Amending the Income Tax Regulations (COVID-19 — Twenty-sixth Qualifying Period): SOR/2022-68
Regulations extend the Local Lockdown Program so businesses subject to public health orders that cut capacity by 50% or more can claim the Canada Emergency Wage Subsidy (CEWS) and Canada Emergency Rent Subsidy (CERS) for the qualifying period February 13, 2022 to March 12, 2022. The change also lowers the required current-month revenue decline to 25% for affected entities and maintains subsidy rates up to 75%; the regulations came into force on registration (2022-03-28).
- Published
- April 13, 2022
- Department
- Unavailable
- Section
- Regulations Amending the Income Tax Regulations (COVID-19 — Twenty-sixth Qualifying Period)
- Comment deadline
- Unavailable
- Effective date
- March 28, 2022
- Publication part
- Part II
Summary
Summary#
The final rule called Regulations Amending the Income Tax Regulations (COVID-19 — Twenty-sixth Qualifying Period) extends temporary help for businesses hit by COVID-19 public health rules. It lets more businesses claim the Canada Emergency Wage Subsidy (CEWS) and Canada Emergency Rent Subsidy (CERS) for the period February 13, 2022 to March 12, 2022. These regulations came into force on registration (March 28, 2022).
What it does#
- Extends the temporary expansion of the Local Lockdown Program (LLP) for the twenty-sixth qualifying period (February 13, 2022 to March 12, 2022).
- Allows an eligible location to qualify if a public health order reduces its capacity by 50% or more.
- Lowers the required current-month revenue decline to 25% (for entities affected by these capacity-limiting orders).
- Keeps the subsidy scale so that:
- entities with a revenue decline of 75% and above get 75% subsidy,
- entities with 25%–75% revenue decline get a subsidy equal to their revenue decline (for example, 60% decline = 60% subsidy),
- entities with 0%–24% decline get 0% subsidy.
- Applies to claims for both wage support (CEWS) and rent/mortgage support (CERS).
Who's affected#
- Businesses and organizations with locations subject to partial public health restrictions that cut capacity by 50% or more.
- Employers that experienced a current-month revenue drop of at least 25% during the qualifying period.
- Sectors most likely to notice this include retail, accommodation and food services, arts, entertainment and recreation, and some personal care and other service businesses.
- The measure could help about 30,000 employers, according to the government’s estimate.
- The Canada Revenue Agency administers the applications and payments.
Why it matters#
- It gives short-term wage and rent relief for firms hit by capacity limits during the Omicron wave. That helps employers keep paying staff and cover rent or mortgage costs.
- The support aims to preserve jobs and reduce permanent business closures while public health rules are in place.
- The government estimates the cost of this extension at about $441.6 million for the period covered.
Key topics
Source: Canada Gazette