Forestry strike-impacted businesses face loss of CEWS eligibility
Port McNeill, B.C. July 29, 2020 - The Port McNeill Chamber of Commerce is exploring avenues of advocacy in our continuing efforts to help coastal BC businesses collaterally impacted by the forest sector strike of 2019 and COVID-19 in 2020. We have reached out to our local leadership and to our MP Honourable Rachel Blaney and MLA Honourable Claire Trevena for assistance in this matter. The PMCC will keep all members impacted by this situation informed.
2019 Coastal Forestry Strike collateral impact: the loss of business access to 2020 Canadian Emergency Wage Subsidy program
FOR IMMEDIATE RELEASE: Port McNeill, B.C. July 29, 2020
BACKGROUND & SITUATION SUMMARY:
In order for businesses to qualify for the Canadian Emergency Wage Subsidy (CEWS) program, a business needs to prove:
A revenue decrease of 15% or more for March 2020, and 30% or more for April 2020 to December 2020.
An employer may demonstrate the drop in qualifying revenue by comparing revenue in an eligible period to one of the following reference periods:
A year-over-year comparator (i.e. comparing March 2020 to March 2019, April 2020 to April 2019, and May 2020 to May 2019); or
An average of revenue earned in January and February 2020.
For more information on CEWS please see: https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html
POLICY IMPACT ON BUSINESSES ALREADY FACING HARDSHIP:
Surveys of businesses directly and collaterally impacted by the July 1st 2019 to February 15th 2020 labour action between Western Forest Products and United Steelworkers Union 1-1937 indicate losses in revenue in the magnitude of 50% or more compared year-over-year to 2018/2017/2016. These businesses include but are not limed to: forestry businesses, accommodation providers, trade service providers, business service, parts suppliers, retailers, childcare providers, and fuel suppliers. (FIR, 2019) (PMCC, 2020)
COVID-19 has caused further losses to strike impacted businesses, yet due to the year-over-year comparator parameters listed above for eligibility, the most vulnerable coastal businesses have now entered a comparative financial period where CEWS support is no longer available - because COVID-19 losses cannot be proven against the already staggering losses. It is a one-two punch for rural coastal economy, and an example where due to policy, a program cannot support those who need it most.
THE PORT MCNEILL CHAMBER OF COMMERCE RECOMMENDS AND RESPECTFULLY REQUESTS:
Our Government and political representatives advocate for and support legislation which allows for strike and hardship-impacted businesses to participate in the extension of and full duration of the CEWS program (Deloitte 2020); OR; Businesses impacted by 2019 labour action or other hardship may use a year-over-year comparator of revenue from 2018 “a normal operating year” to determine eligibility;
That our political representatives immediately help establish who in the system, be it Ministerial Offices, Canadian Revenue Agency or otherwise, is responsible and able to support a policy exception or legislation appropriate to ensure coastal B.C. businesses participation in the full duration of this program;
That our political representatives sees this request through to formal conclusion and maintains consistent dialogue with us on behalf of the business community.
Port McNeill Chamber of Commerce
*Canadian tax alert (Deloitte, July 23, 2020)
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