Bill C-9 (Historical)

An Act to amend the Income Tax Act (Canada Emergency Rent Subsidy and Canada Emergency Wage Subsidy)

This enactment amends the Income Tax Act to revise the eligibility criteria, as well as the level of subsidization, under the Canada Emergency Wage Subsidy (CEWS) as part of the response to the coronavirus disease 2019. It also extends the CEWS to June 30, 2021. The enactment further amends the Income Tax Act to introduce the Canada Emergency Rent Subsidy (CERS) in order to support those hardest hit by the coronavirus disease 2019. This subsidy provides relief in respect of rent and interest on debt obligations incurred to acquire real property used by businesses, charities and not-for-profit organizations in the course of their businesses or other activities. The rent subsidy is effective as of September 27, 2020.

Income Tax Act

[Pierre Poilievre, Conservative, Carleton, ON]

Madam Speaker, the low levels of unemployment across the OECD in the pre-pandemic period are entirely the result of a large share of the workforce retiring, and therefore the unemployment rate dropped everywhere. Across the OECD almost every country in the world had record low unemployment up until the COVID crisis. Before the COVID crisis, Canada's unemployment was still higher than the U.S., the U.K., Japan and Germany. It was higher than those countries and only lower than socialist France and Italy, and it has worsened, moving behind Italy since that time, so now we only have Italy with higher unemployment than Canada in the G7.

So, the member finally says that we have recovered a larger share of our lost jobs than the Americans, but that is because we had a higher unemployment rate than the Americans going into the crisis. If a nation has a weak job market and a weak economy going into a crisis, obviously it is going to be weaker throughout that crisis, and we are seeing that happen now.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I would ask for the consent of the House to share my time with my esteemed colleague from Abitibi—Témiscamingue.

[The Assistant Deputy Speaker, NDP, Carol Hughes]

This being a hybrid sitting of the House, for the sake of clarity, I will ask for only those who are opposed to the request to express their disagreement. Accordingly, all those opposed to the hon. member moving the motion will please say nay.

Unanimous consent has been given.

The hon. member for Joliette.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, Bill C-9 would extend the Canada emergency wage subsidy until next summer and provide real commercial rent support. The Bloc Québécois has been pressing for both of these measures for some time, so I am glad I can finally congratulate the government on introducing them. That is why the Bloc supports this bill and would like to see it passed quickly, as set out in the motion moved earlier.

The most important economic factor for businesses is predictability. In the spring and summer, I repeatedly asked Mr. Morneau to make an effort to announce his intentions for a longer period of time. Businesses have tough choices to make and cannot make the best decisions when they do not know how long measures like the CERB and the wage subsidy are going to last. We know this because we were getting calls and having conversations with entrepreneurs in our ridings. Unfortunately, every measure was announced and extended at the last minute for a month at a time. It was month to month. Businesses were complaining.

Bill C-9 will fix the problem for the wage subsidy. I congratulate the Minister of Finance on being so responsive. It makes a big difference.

The same is true for commercial rent support.

The previous program, the Canada emergency commercial rent assistance program, was a joke. It was very poorly designed, too restrictive and did not provide enough assistance, not to mention that landlords could simply say no. That program did not cover SMEs that own their premises. It was not working, and money was not getting out the door. The government had planned to invest $3 billion in the program, but barely $1.3 billion was spent. That is not even half of what was intended. It was a dismal but predictable failure. The program was designed in such a way that it was not used to cover needs, which were unfortunately very real.

The new rent subsidy is much better designed. The participation of commercial landlords is no longer required. Support is more accessible and more flexible, so it is better adapted to the various situations that SMEs might be up against. Six months after promising it, the government is finally coming through with a program to support businesses and their fixed costs, something the Bloc Québécois was calling for.

I would like to give a brief chronology of events.

On April 11, 2020, after the Bloc Québécois threatened to stop co-operating with the government, it promised to bring in programs to cover the fixed costs of SMEs hit hard by the pandemic.

Two weeks later, on April 29, the government announced the Canada emergency commercial rent assistance program, which was implemented in May. As I said, that program was an absolute joke. It did not really cover the fixed costs for SMEs. The commercial rent assistance program ended in September, as did the wage subsidy.

It took until October 9 for the government to finally announce that it was brining in a program to cover the fixed costs of businesses hard hit by the crisis. That includes rent, mortgages, insurance, and property tax. The government also announced it was extending the wage subsidy.

Nearly a month later, on November 2, the government introduced Bill C-9, and on November 4, we finally started debating it. It was about time, so thank goodness we did. That does not change the fact that the SMEs needed better measures to cover their fixed costs in the spring and summer, but better late than never.

Currently, nine out of 10 Quebeckers live in a red zone. SMEs throughout Quebec need help covering their costs. We applaud the generosity of Bill C-9 for businesses, especially those in a red zone. Bill C-9 is good news. It is well suited to the commercial sector, but it does not solve everything.

A number of sectors have been hit very hard by the crisis and need targeted programs. I am thinking in particular about air transportation, including airports; aerospace; inter-regional transportation; hotel complexes in urban areas; the cultural and entertainment sector, including festivals; summer camps, sugar shacks and reception halls, which lost their entire 2020 season and are on the brink of bankruptcy. This is no joke.

The Bloc Québécois is starting to lose patience and is reiterating its demands to the government. We support Bill C-9, but we want sectoral programs. Time is of the essence. For example, we must absolutely support the aerospace industry. The situation is critical, and Quebec cannot lose this industry.

Providing hundreds of millions of dollars to Ontario's auto industry while snubbing the aerospace industry is an unbelievable injustice for this sector and Quebec's economy. That is just wrong.

There is an aspect of Bill C-9 that is more than problematic. In my opinion, it does not address a deep injustice. As drafted, it seems that Bill C-9 maintains the eligibility of political parties for the wage subsidy and also provides them with rent support. Do our constituents agree with this? Must Quebec and Canadian taxpayers pay to support rich political parties like the Liberal Party through their taxes and collective debt? I think not.

So far this year the Liberal Party has raised more than $8 million. It received at least $800,000 through the wage subsidy. Is it going to keep applying for the wage subsidy until next summer? Will it apply for the rent subsidy or will it pay it back? If yes, when?

What about my Conservative friends? So far this year the party has collected $13 million. Have they paid back the wage subsidy as their leader promised? This deserves a clear answer. Will they put a stop to this serious ethical breach of applying for the wage subsidy, which is funded by taxes and taxpayers' debt?

For the Bloc Québécois, it was clear from the start. It is not up to taxpayers to fund our parties though the wage or rent subsidies. That is unacceptable. Can the Liberals say as much? Is this millionaire party able to take its hands out of the cookie jar for once?

Bill C-9 is a good bill and it should be passed quickly. Our SMEs are struggling and time is of the essence. The government also needs to hurry up and put measures in place for targeted sectors, such as the aerospace industry.

Can the Liberal Party stop scheming about how to get rich at the expense of citizens? Can it stop applying for the wage subsidy, pay that money back and not apply for the rent subsidy?

We are in the midst of the second wave of the COVID-19 pandemic. It is time to help people and support the economy, not time to step up to the trough while doing so. I am asking the Liberal Party to raise its ethical standards by committing to act in an exemplary manner, serve the public and stop serving itself though its own programs. Enough with the gluttony.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the President of the Queen’s Privy Council for Canada and to the Leader of the Government in the House of Commons]

Madam Speaker, these programs, whether it is the wage subsidy or the rent subsidy, were developed and brought forward to help all Canadians and to help small businesses in particular. The legislation before us is as simple as that.

What we are debating today clearly demonstrates the government has recognized that, even though this new program was developed in the last eight months, there is a need to make modifications. Some of those modifications will be retroactive in order to, once again, protect businesses.

Does the member not agree that it is a good thing that virtually from the creation of the program only eight months ago, we have been able to successfully make modifications that will continue to support small businesses and the people of Canada?

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I wholeheartedly agree. When the pandemic hit, we told the government that a wage subsidy would be a good thing. Denmark and other countries had it, so why not follow suit? We were pleased when it was implemented. The program is working well.

We repeatedly asked the Minister of Finance to extend the subsidy for a longer period of time. Businesses have been telling us that they do not know where they stand because they do not know if the subsidy is going to be extended or not. That makes it hard for them to make decisions.

We are pleased with the measures introduced today, and we support them. We want this bill to be passed faster than usual.

However, I think it is unacceptable that the Liberal Party, which has raised $8 million so far this year, is using the wage subsidy to pay itself. The Liberal Party must pledge to stop using subsidies and repay the money it has received.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Madam Speaker, I thank my colleague for his presentation.

We know that the first version of the rent relief program for SMEs was poorly designed, since the vast majority of SMEs could not even access it. Following pressure from us as well as SMEs, a new version is now being proposed.

Does the member agree with the NDP that this assistance should be retroactive to well before September 27? We think all businesses that could not access the first version because it was so poorly designed should be able to access the new version retroactively so they can continue to operate, contribute to their communities and provide employment opportunities.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam Speaker, I thank my colleague from New Westminster—Burnaby for his question.

I agree that the rent relief program was not working. The federal finance minister said that it was a provincial jurisdiction, but Quebec's finance minister, Mr. Girard, said that the way the program was formulated meant it was not a provincial jurisdiction and that it had been designed that way by the federal government.

We knew all along that it would not work. We got calls from many small businesses saying they were not eligible for the rent relief. Some business owners told us that they owned their premises but were not eligible for rent relief because they had a mortgage. Others said that their landlord did not want to apply. It was not working.

The program being proposed today is much better. It is retroactive to September 27. Should it be retroactive to the beginning of the crisis? That is an interesting question and I raised it with the government, but it does not seem open to that idea. It is looking ahead, because all of these programs are expensive. However, this is certainly something that we should study carefully, since many businesses are facing bankruptcy because their fixed costs were not covered during the summer.

[Claude DeBellefeuille, Bloc, Salaberry—Suroît, QC]

Madam Speaker, the Bloc Québécois has always been proactive in proposing solutions for SMEs. Incidentally, we want to thank the economic partners in our ridings, such as the Haut-Saint-Laurent RCM, the Beauharnois-Salaberry RCM and CLD, the Vaudreuil-Soulanges RCM and the Suroît-Sud CFDC.

Can my colleague explain the impact on these organizations? The time lag between the announcement of a program and its implementation—

[The Assistant Deputy Speaker, NDP, Carol Hughes]

The hon. member for Joliette for a brief answer.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Madam President, I thank my colleague from Salaberry—Suroît for the question.

Our job is to be a liaison between all these organizations on the ground that represent SMEs and the government. We repeat what we hear and propose what might work.

On April 11, we asked that fixed costs be covered. However, this measure will be retroactive only to September 27. The time lag between our request and the announcement is a bit too long.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Madam Speaker, Quebec recently announced that businesses in the red zone will remain closed until November 23.

As we enter the second month of the second wave, entire sectors of Quebec's economy are still waiting for adequate assistance from Ottawa.

With many businesses closer to bankruptcy than ever before, our business owners are emphasizing that the simplest, most effective and most transparent solution, both for them and for the government, would be to implement a program to help offset fixed costs.

Could we start discussing this and addressing the real needs of business owners, who are the backbone of our economy?

That is the take-away from the September 30 survey of 1,700 SMEs conducted by the Canadian Federation of Independent Business. It also shows that 50% of Quebec businesses, or one in two, believe they would not easily survive a second wave of restrictions.

This same survey showed that 27% of SMEs will survive less than a year with the revenue they are currently taking in. Quebec's SMEs are saying that they need an average of $25,000 to cover their fixed costs until December 2020. That is huge. The numbers speak for themselves. We need to act. We need to act intelligently and quickly, because our economic vitality is precisely what will helps us pay down some of the debt we are currently accumulating. The future of our SMEs is at stake.

With Bill C-9, the government decided to extend the Canada emergency wage subsidy until the summer of 2021. That is a very good thing. When a federal measure or program is worth mentioning, the Bloc Québécois is not afraid to say it.

It is all well and good to extend the program until June 2021, but what will the parameters be as of January 2021? We know what they are until December 31, 2020, but we do not know what they will be from January to June. We do not know anything, even though, as my colleague from Joliette said, predictability is essential for our entrepreneurs.

I would also like to remind the Liberals that the wage subsidy is for businesses and organizations, not political parties. I will also remind the Conservatives of that. Quebeckers are still waiting for the Liberal Party and the Conservative Party to pay back the subsidy, which they used for political purposes. That is shameful.

I will get back to the subject of Quebec SMEs. Quebec has nearly 250,000 small and medium businesses that account for 93% of private-sector jobs, or 2.3 million workers who will contribute to rebuilding Quebec's economy and their families' quality of life. Would the government risk cutting that in half? SMEs are vital to Quebec's economy.

We know that the Government of Canada missed its opportunity to help our SMEs pay their rent during the first wave with the program that ended on September 30. Yes, the proposed wage subsidy in Bill C-9 is a good program, and the commercial rent subsidy is much better now, but it is not enough. When will the government come to the House with a substantive program that will actually help Quebec SMEs with their fixed costs?

Quebec has already taken steps to help SMEs with their fixed costs. Establishments in red zones are entitled to a refund of the bulk of their fixed costs for a maximum of $15,000 for the month of October. Eligible costs include commercial rent, municipal and school taxes, interest on mortgages, utilities, insurance, telecommunications, permits, and association dues. Some 13,000 businesses are eligible to receive this help. Why did Canada not offer such effective help for fixed costs for our SMEs in Quebec?

The first version of the commercial rent assistance program was a failure. Whether a business survived or failed was in the landlord's hands because they could refuse to participate in the program and let the renters head for bankruptcy. Obviously we all got phone calls about this in our respective ridings.

In Bill C-9, with the new proposed version of the Canada emergency rent subsidy, the financial assistance will be offered directly to the renter. That is essential. It is also simpler.

However, it is terrible to see that it took the Liberals seven months to understand that this is what needed to be done. It was a waste of time, an unnecessary stress for people, the landlords and renters. It created conflict.

The proposed new version of the emergency commercial rent assistance seems a bit more flexible and open. That is an improvement, because some assistance was added to help businesses that own their buildings cover fixed costs like insurance, property taxes and mortgage interest.

Why not go further, though?

Bill C-9 does not reflect reality. It does not acknowledge that sectors are diverse and that businesses in our regions, such as hotels, cultural businesses and organizations, and even summer camps, have specific realities.

Tourism and cultural industries in Quebec are a crucial part of our regions and our culture. Tourism and cultural businesses have not been doing well for months now. These businesses do the majority of their business during the summer, but they posted huge revenue losses this year. Quebec's tourism and cultural industry experienced a drastic 60% drop in sales and a loss of $3.4 billion in revenue, not to mention the countless businesses that were shut down.

Fixed costs represent 25% of expenses in the tourism industry. Could we look at creating a fixed-cost tax credit, on top of the commercial rent assistance program for small businesses in general, to give them a chance to get back on their feet during the next normal tourism season?

Fixed costs, once again, are commercial rent, municipal and school taxes, mortgage interest, electricity and gas bills, insurance, telecommunications costs, permits and association fees. At least, those are the fixed costs Quebec recognizes. Canada will need to do the same.

In our various interventions over the past few months, the Bloc Québécois has repeatedly insisted—and we continue to insist—on the importance of the recovery, which must of course be a green recovery and take the environment into account. We need to think about the future, and I mean beyond the next election.

One thing that really concerns me is the development of our regions. Recognized for their vitality on so many levels, our regions contribute massively to the natural and intellectual wealth of our urban centres. Their creative strength and innovative spirit open the door to new and effective avenues for community development.

I must insist on the need to stop pondering the idea of a regional development and recovery fund geared toward processing natural resources where they are found. A territorial innovation support program by and for the regions would also be welcome.

The Bloc Québécois firmly believes that any existing and future programs must be flexible and that we must be able to adapt the way they are administered to the regions' different realities. That is key. As we have seen with the issue of immigration, a one-size-fits-all approach too often does not work for the regions.

Because we want to establish a vision for the future and because our organizations and SMEs make an important contribution to the recovery, it seems clear to me that the CFDCs, for example, are well placed to help the various local and regional entities. This will help address the real needs of our communities and identify the priorities for recovery and the target industries.

The regional relief and recovery fund responded to the need for support that existed before the program was put in place and to the need to quickly get the funding out to our businesses. I would like to point out that this was a success in Abitibi-Témiscamingue.

What is more, the communities themselves are in the best position to target the appropriate innovation zones for their area. Since the pandemic began and even before, it is the communities themselves and their residents who have identified the most pressing needs and the business development opportunities.

Simply put, Quebec and its regions know what is best for Quebec. In conclusion, six months after making that promise, the Government of Canada has finally come up with the fixed cost support program the Bloc Québécois pushed for. That is why, even though the program is not perfect, the Bloc Québécois and I would like to see Bill C-9 passed quickly.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the President of the Queen’s Privy Council for Canada and to the Leader of the Government in the House of Commons]

Madam Speaker, one of the issues, of course, is working with different levels of government. In the province of Manitoba, the provincial government has decided to get more engaged in terms of helping small businesses. I am wondering if my colleague could provide his thoughts regarding the role that different levels of government also have in terms of supporting small businesses in our many different communities.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Madam Speaker, I thank the member for Winnipeg North for his question.

As an MP, I observed something troubling during the first six months of the pandemic. I did not realize that there was excellent collaboration among various levels of government despite what we were hearing during question period. For one thing, I did not get the impression that there was any dialogue happening with the Government of Quebec. I especially did not get the impression that there was any support for our SMEs, including support for fixed costs and rent.

I sincerely hope that Bill C-9 will be passed quickly so the money can get out the door and into people's bank accounts fast. I encourage the federal government to sit down with the provinces and be as generous as possible with our SMEs, which make up the economic fabric of Quebec and its regions.

[Don Davies, NDP, Vancouver Kingsway, BC]

Madam Speaker, too many businesses in my riding are being excluded from the emergency business account, the CEBA, because contracts after March 1 are not included in the $40,000 expenses required to access the loan. One constituent recently pointed out to me that many businesses did not begin feeling the effects of COVID-19 until well after March 1. In fact, the Liberal government did not even create a committee to begin studying the possible effects of COVID-19 until March 4, 2020. Business owners in my constituency and across Canada who have sacrificed so much during COVID-19 should be supported by their government. There are others across this country in similar situations.

I am wondering if my hon. colleague would agree with me that we need a change in the CEBA eligibility to allow expenses beyond the current March 1, 2020, deadline to help these small businesses who are struggling so hard.