What to Know
The number of COVID-19 cases in Canada continues to grow. Canada is reporting 612 cases, though only 23 new cases in Ontario today which is well below the 33% increase seen in other countries.
This morning WestJet announced that passengers on 14 of its flights had COVID-19 and provided the flight numbers and rows. Six of those flights either originated or terminated in Toronto. More information about specific flights here.
Canada’s six largest banks announced plans last night to provide financial relief to Canadians impacted by the economic consequences of COVID-19. Effective immediately the banks will work with personal and small business banking customers to provide flexible solutions to help them manage through challenges such as pay disruption due to COVID-19; childcare disruption due to school closures; or those facing illness from COVID-19. This support will include up to a six-month payment deferral for mortgages, and the opportunity for relief on other credit products. Canadians and businesses should contact their bank directly.
At today’s news conference the Prime Minister announced Canada and the US have finalized a plan to temporarily restrict the border to non-essential travel, but it will remain open to trade and commerce. Essential travel will continue to ensure supply chains including fuel, food and medicine will not be affected by this measure.
The Prime Minister also announced up to $27-billion in aid to help Canadians and Canadian businesses weather COVID-19 disruptions. The government also announced $55-billion in tax deferrals to meet the liquidity needs of Canadian businesses and households. This represents 3% of Canada’s GDP.
The Prime Minister said that all party leaders in the house and senate are working collaboratively to quickly ensure all Canadians get the help they need.
Some of the measures announced today by the Prime Minister include:
- Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks. This flat-payment Benefit would be administered through the Canada Revenue Agency and provide income support to:
- Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits.
- Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not quality for EI sickness benefits.
- Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.
- Canada Revenue Agency will defer the filing due date for the 2019 tax returns of individuals until June 1, 2020. All taxpayers can defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020. This relief would apply to tax balances due, as well as instalments. No interest or penalties will accumulate on these amounts during this period.
- Individuals who expect to receive benefits under the GSTC or the Canada Child Benefit are encouraged not to delay the filing of their return to ensure their entitlements for the 2020-21 benefit year are properly determined.
- To support businesses that are facing revenue losses and to help prevent lay-offs, the government is proposing to provide eligible small employers a temporary wage subsidy for a period of three months. The subsidy will be equal to 10% of the remuneration paid during that period, up to a maximum subsidy of $1,375 per employee and $25,000 per employer.
- Businesses will be able to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020. This relief would apply to tax balances due, as well as instalments. No interest or penalties will accumulate on these amounts during this period.
- The Business Credit Availability Program will allow the BDC and EDC to provide more than $10 billion of additional support, largely targeted to SMEs. This is to help viable Canadian businesses remain resilient. BDC and EDC are cooperating with private-sector lenders to coordinate on credit solutions for individual businesses, including in sectors such as oil and gas, air transportation and tourism.
Yves Giroux, Canada’s Parliamentary Budget Officer, was largely positive about the measures announced.
Premier Ford thanked the Prime Minister for the measures outlined earlier today and Finance Minister Phillips also applauded the plan. Queen’s Park will sit tomorrow to pass two COVID-19 bills and then adjourn until March 25. The measures are to provide job protective leave for workers with symptoms of COVID-19 and support for parents who have taken time off due to daycare closures.
The Premier announced that testing capacity is up to 2,000 tests per day, but the Premier is still aiming to ramp-up to 5,000 tests per day.
- The number of COVID-19 cases in the United States continues to grow with 7,553 cases reported. Experts still believe there is significant underreporting.
- Currently there are 80,894 cases in China. The number of new cases in China continues to flatline.
- India’s number of COVID-19 cases has grown to 151.
- Japan’s COVID-19 cases are flatlining as well, now up to 899.
- European cases continue to grow by the hour. Switzerland is reporting 3,070 cases, while Spanish cases continue to grow rapidly now reporting more than 13,910 cases while Italy has 35,713 cases.
- The UK government has unveiled a package of financial measures including £330bn in loans, £20bn in other aid, a business rates holiday, and grants for retailers and pubs. Help for airlines is also being considered.
The United States plans to send direct cash payments to families, consumers and small businesses in the coming weeks. The overall price tag for this package could be $1 trillion. The administration is also considering legislation to include support for small businesses and aid for the airline industry, in addition to a range of other measures.
The Japanese government and ruling parties are considering handing out more than 12,000 yen per citizen in cash as part of an emergency economic stimulus package. The ruling party plans to put together recommendations for economic stimulus measures centering around cash handouts as early as the end of March. The government intends to formally map out measures possibly in early April based on the Liberal Democratic Party (LDP) proposals after the passage of the fiscal 2020 budget.
The Australian government unveiled its $17.6 billion stimulus package targeting mostly businesses and welfare recipients, including pensioners. The government unveiled a A$$715 million aid package for airlines, including waivers on domestic air traffic control fees.
What to Watch
In a news conference following the Prime Minister, Minister Morneau indicated that the packaged announced is a first step. The Finance Minister also stated that he was ready to work with Alberta and Newfoundland and Labrador address the economic issues arising from the crash in oil prices.
Bank of Canada governor Stephen Poloz said that Canada is in a better position today than it was in 2008. As a result of the strength of our banking system the country has the ability to be nimble in response to the COVID-19 economic turmoil. He stressed that the bank needed to conduct significant assessments of what is happening in the economy before deciding if other moves, such as an emergency rate cut or quantitative easing, would be necessary. The next scheduled announcement date for a change to rates is April 15.
Additional measures are expected to be announced by Finance Minister Rod Phillips next week. It may come on March 25 when the province’s scaled-back mini budget is to be released.