Restaurants Canada is applauding Friday’s federal announcement of new support measures for workers and businesses impacted by the tariff dispute with the U.S.
The move to open the EI Work-Sharing Program to more workers for longer periods is particularly important, as it will allow affected workers to maintain their connection to their job through any disruptions, it said.
“Helping exporters find new markets, providing favourable loans to businesses facing liquidity issues and shoring up our agri-food sector are all moves in the right direction. Restaurants Canada also commends federal and provincial governments for all of the progress they have made on removing interprovincial trade barriers, in particular the move to allow the sale of alcohol products from other jurisdictions in most provinces,” said Janick Cormier, Vice-President, Atlantic Canada, Restaurants Canada.
“The last few months have thrown Canada’s economy into turmoil, at a time when many restaurants are operating at a loss or just breaking even. The foodservice industry is Canada’s fourth largest private sector employer, with nearly 1.2 million workers, and contributes $120 billion to the economy. Their success props up every community in Canada and tens of other industries, from fishing to tourism to agriculture.”
Restaurants Canada is urging the government to be prepared to do more for workers and businesses if the tariff threat continues.
“The restaurant industry stands with governments in protecting Canada’s interests, but retaliatory tariffs will add pressure to an industry that is in worse shape now than at any time during the pandemic,” said Cormier.
If the government can’t exempt those items, Restaurants Canada said it can soften the blow for the foodservice industry by:
- Removing sales tax from all food, as it did during the GST/HST holiday.
- Providing manufacturing credits to enable food and packaging manufacturers to expand production quickly.
- Loosening regulations around packaging requirements from out of country products that may be substitutes for American-made products.
- Rolling out a wage subsidy program to keep employees connected to their workplaces and prevent job losses.
Provincial governments can also help by deepening alcohol wholesale discounts.
On Friday, the federal government said “we will use every tool at our disposal so Canadian businesses and workers can weather this storm. We will defend Canadian jobs.”
“To support our businesses and ensure they have the liquidity they need through this turbulent time, we will be:
- Launching the Trade Impact Program through Export Development Canada. The program will deploy $5 billion over two years, starting this year, to help exporters reach new markets for Canadian products and help companies navigate the economic challenges imposed by the tariffs, including losses from non-payment, currency fluctuations, lack of access to cash flows, and barriers to expansion.
- Making $500 million in favourably priced loans available through the Business Development Bank of Canada to support impacted businesses in sectors directly targeted by tariffs, as well as companies in their supply chains. Businesses will also benefit from advisory services in areas such as financial management and market diversification.
- Providing $1 billion in new financing through Farm Credit Canada to reduce financial barriers for the Canadian agriculture and food industry. This lending offer will help address cash flow challenges so that businesses can adjust to a new operating environment and continue to supply the high-quality agricultural and food products that Canadians rely on.”
Along with supporting businesses, the government said it is also introducing temporary flexibilities to the EI Work-Sharing Program to increase access and maximum agreement duration.
“The Work-Sharing Program provides EI benefits to employees who agree with their employer to work reduced hours due to a decrease in business activity beyond their employer’s control. This helps employers retain experienced workers and avoid layoffs and helps workers maintain their employment and skills while supplementing the reduced wages with EI benefits,” it said.
“In the weeks and months ahead, additional measures will be brought forward to support businesses and workers as needed. The federal government will continue to work closely with provinces and territories to ensure complementary supports are in place across all jurisdictions.”
“We are deeply committed to supporting Canadian businesses and workers in the face of the unjustified and unreasonable tariffs the United States has imposed on Canadian goods. We have faced economic challenges before, and we know we will overcome this new challenge. The measures announced today as part of our Team Canada response will protect jobs, keep businesses open, and help stabilize Canada’s economy,” said Dominic LeBlanc, Minister of Finance and Intergovernmental Affairs.
Dan Kelly, President and CEO of the Canadian Federation of Independent Business, said it is hard to sort out right now what kind of supports will be most useful for small businesses and workers affected by US tariffs and Canada’s retaliatory tariffs.
“With tariffs themselves changing every five minutes, getting this right will be a challenge. Expanding the EI Work-Sharing Program is a sensible way of allowing small firms to trim payrolls without losing connection to their workers. It has been used in past emergencies and is a proven help. As for the other supports, what I can tell you is that small firms are NOT looking for more debt through loans. While the CEBA program was helpful during the pandemic, what small firms need in emergencies is help meeting payroll and keeping the lights on,” he said.
“One thing that would be very useful is help in defraying shipping costs for small firms that need to reach a new export market or a supplier of imported goods. Business subsidies are bad ideas in normal times, but an SME shipping support program may be very helpful to small firms trying to sell into/buy from other Canadian provinces or countries other than the United States. CFIB data show that shipping costs are one of the chief obstacles to Canadian small firms looking at markets outside of the US.
“Temporary help may help catalyze greater interprovincial trade and utilization of our trade agreements. I welcome thoughts from small business owners on this idea.
“Beyond that, the best thing governments can do is: 1. Recall Parliament to ensure we can respond quickly. 2. Kill the capital gains inclusion rate hike and the April 1 hike in carbon taxes & liquor taxes. 3. Immediately pass the increase in the Lifetime Capital Gains Exemption, the Canada Entrepreneur Incentive and legislation to make the December $2.5B carbon tax rebate tax free. 4. Continue with the significant progress in mutually recognizing all provincial rules to fix interprovincial trade. (good work on this one is happening) 5. Pass emergency tax cuts – like cutting the small business corporate rate to zero for the next year – both federally and provincially.”
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