Prime Minister Justin Trudeau has announced significant rent relief for businesses that are struggling to pay their landlords due to the COVID-19 pandemic.
The rent relief plan will be funded jointly with the provinces, and it will provide non-repayable loans to commercial property owners to cover 50 per cent of rent payments for April, May and June.
The loans will be forgiven if the property owner agrees to cut the rent by at least 75 per cent for those months, while also promising to not evict the tenant. It would be up to the tenant to cover the rest of the rent, which would be up to 25 per cent.
Small businesses that pay less than $50,000 a month in rent qualify for this subsidy if they have seen a drop in revenue of at least 70 per cent from pre-COVID-19 levels, or if they have been forced to close down because of public health restrictions.
Non-profit and charitable organizations are also eligible, while there will be more information coming for larger businesses that need rent support.
“We recognize that COVID-19 is hitting some people harder than others, some areas harder than others, and unfortunately this is something we are grappling with,” said Trudeau, while acknowledging that some businesses will be unable to come up with their portion of the rent.
“We are trying to help as many people as possible.”
While it welcomes the rent relief program, the Canadian Federation of Independent Business (CFIB) warns it may be too complicated and too reliant on landlords to administer.
“As landlords do not have to participate and will be expected to accept some losses under the program, they may choose to ignore it, even if their tenants badly need it,” said CFIB vice-president Laura Jones, in a statement.
The CFIB also criticized the requirement that a qualifying business report a loss of 70 per cent of its revenues, saying that might disqualify some hard-hit businesses.
Trudeau also says applications for the Canada Emergency Wage Subsidy program will begin next week. He notes the government has a calculator on the Canada Revenue Agency website which will help businesses calculate what they are covered for through the Canada Emergency Wage Subsidy.
Applicants will be able to access the wage subsidy starting on Monday, April 27, according to the prime minister.
-With files from The Canadian Press
