On July 30, 2021, the Government of Canada proposed the following changes to its COVID-19 programs:

• Extensions of the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Rent Subsidy (CERS) and Lockdown Support until October 23, 2021, and increasing the rate of support for employers and organizations during the period between August 29 and September 25, 2021.
• The maximum rate for wage and rent subsidies would be set at 40% in Period 20 (August 29 to September 25) instead of being reduced to 20% as announced in Budget 2021.
• The programs would be extended by one additional period, with a maximum rate of 20% in Period 21 (September 26 to October 23).
• The Lockdown Support would also be extended until October 23, 2021, at its rate of 25%.
• Eligible employers would still be able to apply for the new Canada Recovery Hiring Program (which is available from June 6, 2021 until November 20, 2021) instead of the wage subsidy if they so choose.
• Only employers with a decline in revenues of more than 10% are eligible for the support for Period 19 (August 1 to August 28), Period 20 (August 29 to September 25), and Period 21 (September 26 to October 23).
• An eligible organization could elect to use the alternative approach to calculate its revenue decline for Periods 14 to 17 (March 14 to July 3, 2021) if it was not carrying on a business or otherwise carrying on ordinary activities on March 1, 2019.
• The wage subsidy for furloughed employees would continue to be available to eligible employers that qualify for the CEWS for active employees for the relevant period until August 28, 2021.

Please contact Gergely Hegedus for more questions regarding these proposed changes or other tax policies that may affect your organization.