Industry associations representing thousands of Canadian businesses, including the Canadian Federation of Independent Business (CFIB), are urging Deputy Prime Minister Chrystia Freeland to extend the Canada Emergency Business Account (CEBA) repayment deadline.
Tima Miroshnichenko
Here is the full letter:
Dear Minister Freeland:
Industry associations representing hundreds of thousands of businesses across Canada are urging you to extend the current Canada Emergency Business Account (CEBA) repayment deadline by two years to the end of 2025, or at least by one year, while maintaining access to the forgivable portion.
Almost 900,000 CEBA loans were approved across Canada. Many businesses had no choice but to take on this loan due to circumstances beyond their control. This includes businesses in some of the hardest hit industries such as the retail industry and tourism sector. Mandatory business closures and other government health restrictions left businesses with severe income losses and cash flow issues.
Despite their best efforts, high interest rates, inflation and increased labour costs are making it difficult for small-and-medium size businesses to keep their heads above water, let alone make any dent in the debt many had to take on to survive pandemic restrictions. A recent analysis of over 15,000 Canadian businesses found that inflation, input costs, and interest/debt costs are the three most acute obstacles faced by business (at 56%, 40% and 38%, respectively), and the smaller the firm, the more constrained they are by debt.
Moreover, recent surveys focussed on CEBA loan-holder companies reveal that:
- 49% of small businesses are still making below normal revenues;
- 50% of Canadian foodservice operators are currently operating at a loss or breaking even compared to 12% pre-pandemic; and,
- 45% of Canada’s tourism businesses are likely or somewhat likely to close within the next three years without government intervention into their mounting debt load.
Unless the federal government acts quickly to postpone the CEBA repayment deadline, businesses that are unable to repay their CEBA loan in time will lose access to the forgivable portion of up to $20,000, thus further increasing their debt load. Extending the repayment timeline for the CEBA loan without losing access to the forgivable portion would give many small-and-medium size businesses the stability and certainty they need to get back on their feet on a path to prosperity.
We urge you to quickly address this important matter.
The complete list of businesses signing the letter can be found here.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list)
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