BUSINESS RELIEF OVERVIEW
Employer Health Tax
The government is cutting taxes by $355 million for about 57,000 employers by proposing a temporary increase to the Employer Health Tax (EHT) exemption from $490,000 to $1 million for 2020. With this plan, more than 90 per cent of private-sector employers would not pay EHT in 2020.
Eligible private-sector employers with annual payrolls up to $5 million would be exempt from EHT on the first $1 million of total Ontario remuneration in 2020.
- The maximum EHT relief from the exemption would increase by $9,945 to $19,500 for 2020 for eligible employers.
About 57,000 private-sector employers would pay less EHT, including about 30,000 who would not pay any EHT for 2020, effectively eliminating EHT for these employers for one year. The exemption would return to its current level of $490,000 on January 1, 2021.
Support for People and Businesses to Improve Cash Flow
Ontario is making $10 billion available to improve cash flows for people and businesses through tax and other deferrals over the coming months to provide relief during this challenging economic time, in coordination with the federal government.
$6 Billion in Tax Deferrals
To help support Ontario businesses when they need it most, the government is providing a five-month interest and penalty-free period for businesses to make payments for the majority of provincially administered taxes.
Beginning April 1, 2020, the Province is providing flexibility to about 100,000 businesses in Ontario to help manage their cash flows during this challenging time. This will continue for a period of five months, up until August 31, 2020, and is expected to make available $6 billion to improve the cash flows of Ontario businesses.
For this period, the Province will not apply any penalty or interest on any late-filed returns or incomplete or late tax payments under select provincially administered taxes, such as the Employer Health Tax, Tobacco Tax and Gas Tax.
The initiative and relief period complement the relief from interest and penalties from not remitting Corporate Income Tax owing that was announced by the federal government on March 18, 2020.
$1.8 Billion in Education Property Tax Deferrals
The Province recognizes that many residents and businesses are facing challenges in making their scheduled property tax payments. The government is working closely with municipalities as they introduce measures to provide property tax relief, for example, by allowing taxpayers to defer property tax payments.
To encourage these actions, the government is deferring the property tax payments municipalities make to school boards by 90 days.
In addition to collecting municipal property taxes, municipalities collect and remit education property taxes to school boards on a quarterly basis. Deferring the June 30 quarterly remittance to school boards by 90 days will provide municipalities with the flexibility to, in turn, provide over $1.8 billion in property tax deferrals to residents and businesses.
To ensure this does not have a financial impact on school boards, the Province will adjust payments to school boards to offset the deferral.
$1.9 Billion in Workplace Safety Expenses
Working in conjunction with the government of Ontario, the Workplace Safety and Insurance Board (WSIB) will allow employers to defer payments for a period of six months. This will provide employers with $1.9 billion in financial relief.
All employers covered by the WSIB’s workplace insurance are automatically eligible for the financial relief package. Schedule 1 employers with premiums owed to the WSIB will be allowed to defer reporting and payments until August 31, 2020. The deferral will also apply to Schedule 2 businesses that pay WSIB for the cost related to their workplace injury and illness claims. In addition, no interest will be accrued on outstanding premium payments and no penalties will be charged during this six-month deferral period.
Supporting People and Jobs
People across Ontario are responding to the evolving COVID‑19 outbreak by taking additional precautions to keep themselves, their families and their communities safe.
They should not be penalized for acting responsibly and doing the right thing by following the advice of public health officials. Building on coordinated actions with the federal government, Ontario is taking immediate steps to support people and families by planning to invest $3.7 billion in supports for people and jobs in response to the COVID‑19 outbreak.
The Province is providing immediate financial support of an additional $75 million to 194,000 vulnerable seniors, who may need more help to cover essential expenses during the COVID‑19 outbreak, by proposing to double the Guaranteed Annual Income System (GAINS) maximum payment for low-income seniors, for six months starting in April 2020. This would increase the maximum payment to $166 per month for individuals and $332 per month for couples.
The government is also helping seniors by providing $5 million to support the coordination of subsidized deliveries of meals, medicines and other essentials, by working with local businesses and charities as well as existing health services.
To help parents pay for the extra costs associated with the closure of schools and daycares during the COVID‑19 outbreak, the government is providing a one-time payment of $200 per child up to 12 years of age, and $250 for those with special needs, including kids enrolled in private schools.
As part of the government’s efforts to contain the COVID‑19 outbreak, Ontario is also providing emergency child care options to enable parents who are front-line workers to report for work, such as health care workers, police officers, fire fighters and correctional officers.
The government is temporarily suspending Ontario Student Assistance Program (OSAP) loan repayments between March 30, 2020 and September 30, 2020, during which time borrowers will not be required to make any loan or interest payments. In coordination with the federal government’s measures, this will immediately leave more money in the pockets of student borrowers during these challenging economic times.
The government is taking further measures to support Ontario workers, with initiatives including:
- Quickly passing legislation to provide job-protected leave to employees in isolation or quarantine, or those who need to be away from work to care for children because of school or daycare closures due to the COVID‑19 outbreak;
- Committing $100 million in funding through Employment Ontario for skills training programs for workers affected by the COVID‑19 outbreak; and
- Working with the federal government to find ways to support apprentices and enable businesses to continue to retain these skilled trades workers during the COVID‑19 outbreak.
Indigenous Peoples and Communities
The government is providing supports of $26 million for Indigenous peoples and communities, including emergency assistance for urban Indigenous people in financial need and costs for health care professionals and critical supplies to reach remote First Nations.
During the COVID‑19 crisis, it is particularly important to support vulnerable people, including those who are homeless, unemployed or living in poverty. That is why the government is:
- Investing $52 million to expand access to the emergency assistance program administered by Ontario Works to provide financial support to people facing economic hardship and help them with basic needs, such as food and rent during this public health emergency;
- Enhancing funding for charitable and non-profit social services organizations, for example food banks, homeless shelters, churches and emergency services such as the Red Cross, to improve their ability to respond to the COVID‑19 outbreak. The government is doing this by providing $148 million directly to Consolidated Municipal Service Managers and District Social Service Administration Boards who would allocate this funding based on local needs; and
- Equipping essential first responders and front-line staff in the justice sector with the necessary personal protective equipment and other critical supplies required to ensure the safety and security of all people in Ontario during the COVID‑19 outbreak.
The government is supporting people and businesses with the costs of electricity during the COVID‑19 outbreak. That is why the government is:
- Providing $9 million in direct support to families for their energy bills by expanding eligibility for the Low‑income Energy Assistance Program (LEAP) and by ensuring that their electricity and natural gas services are not disconnected for nonpayment during the COVID‑19 outbreak; and
- Supporting more affordable electricity bills for eligible residential, farm and small business consumers, by providing approximately $5.6 billion for electricity cost relief programs in 2020–21. This is an increase of approximately $1.5 billion compared to the 2019 Budget plan. The Province is also setting electricity prices for residential, farm and small business time-of-use customers at the lowest rate, known as the off-peak price, 24 hours a day for 45 days to support ratepayers in their increased daytime electricity usage as they respond to the COVID‑19 outbreak, addressing concerns about time-of-use metering.”