On July 24, the Canadian Chamber of Commerce and the Milton Chamber of Commerce, along with over 280 industry associations, sent an open letter addressed to Minister Freeland, urging the government to extend the Canada Emergency Business Account (CEBA) repayment deadline.
Read the full letter below.
Sent via email.
The Honourable Chrystia Freeland
Deputy Prime Minister
Minister of Finance
Member of Parliament, University—Rosedale, Ontario
Department of Finance Canada
90 Elgin Street
Ottawa, Ontario
K1A 0G5
Subject: Industry Associations Call for More Time to Repay CEBA loans
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 focused 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.
With each passing day, entrepreneurs who collectively maintain a very considerable workforce, face increasingly daunting financial pressure.
Ottawa needs to act now to extend the CEBA repayment deadline.
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.
