Here is a look at the programs including the issues facing the stimulus.

1. Pandemic and
Government Response –
Government Stimulus -
Canada
Paul Young CPA CGA
April 4, 2020

2. Paul Young - Bio
• CPA, CGA
• Academia (PF1, FA4 and MS2)
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Financial Solutions
• SME – Business Process Change
• SME – Supply Chain Management
Contact information:
Paul_Young_CGA@Hotmail.com

3. Agenda
 Overview
 Wages subsidy
 Issues facing businesses
 Government stimulus for small and medium size business.
 Chamber of Commerce
 CFIB
 RBC Report
 Other issues

4. Introductory
 No time in modern day history has Canada seen major shutdowns of key
segments of its economy.
 The fallout of oil and other commodities is having an impact on government
taxation - https://finance.yahoo.com/news/whiting-failed-comeback-pushes-
shale-141156710.html
 Cash flow is key aspect to business. Without cash flow many businesses will
not be able to meet their many obligations. Employees are only one piece of
the operations.
 There is disparity as government workers continue getting paid while many
people in the private sector have been forced to EI -
https://www.slideshare.net/paulyoungcga/2019-election-public-sector-
efficiency-canada-july-2019

5. Wage Subsidy
Source – RBC, Government of Canada and ScotiaBank
Issues and concerns
- Startup and fast-growing companies -
https://business.financialpost.com/technolo
gy/wage-subsidy-rules-leave-startups-and-
fast-growing-companies-out-in-the-cold
- CRA will want proof there is decline of 30%.
CRA already has limited resources. There as
no contingency plan to use CPA firms -
https://www.investmentexecutive.com/new
s/industry-news/details-released-on-federal-
wage-subsidy-program/
- The program is the right idea, but like many
liberal programs will be the liberals ability to
provide oversight -
https://www.slideshare.net/paulyoungcga/h
as-justin-trudeau-been-open-and-
transparent
- Timing of the payments Emergency Benefits,
especially if those people have not filed tax
returns and/or Record of employment. All
Service Canada locations have been closed.

6. Small Business Scenario
Expense line Scenario #1 Scenario#2 Scenario#3
Complete Close down Partial Shutdown Operational (fully)
Employees Laid off everyone Partial Everyone Minimal layoffs
EI Employees: 55% of their
wages
Employees: 55% of their
wages
Employees: 55% of their
wages
Sales Drop 100% <100% Business as usual
Hydro
Rent/mortgage payments
Raw Materials
Wages
Purchased Finished goods
Vehicles
Other Expenses

7. What drives a business
 Sales and Cash flow
 Partial shutdown
 Loss revenue – Business can operate but could see a dramatic drop in sales
 Business will have limited access to operational cash flow due to loss of sales
 Staff still gets paid, but may see a reduction in hours
 Operational costs must be paid
 Complete shutdowns
 Loss of revenue
 Operational costs still must be paid
 All employees on EI
 Cash flow problems (not being able to meet obligations)

8. Private Sector Wage Subsidy
 Government proposed to subsidies:
 75%
 10%
Source - https://thoughtleadership.rbc.com/bold-and-broad-federal-government-announces-details-
Issues/Concerns
1. Cash Flow – Businesses run on cashflow
based on sales. No sales means no cash for
their overall cost burden
2. 10% wage support will have little or no
effect. A business will not be able to pay
90% of the wages if their sales and
cashflow had been reduced.
3. 30% sales justification is based on a month
over month. This means there is a delay
because you must wait until sales hit this
threshold. Businesses need operational
grants to support their costs structure
4. Partial shutdowns
1. Businesses would have limited staff,
but still have all their operational
expenses
2. Partial businesses also need
operational grants

9. Chamber of Commerce and Wage Subsidy
Source - http://www.chamber.ca/media/news-releases/200401-emergency-wage-subsidy/

10. CFIB
Source - https://www.cfib-fcei.ca/en/media/news-releases/cfib-statement-canada-emergency-wage-subsidy-details

11. RBC Report
Source - https://thoughtleadership.rbc.com/bold-and-broad-federal-government-
announces-details-for-wage-
subsidy/?utm_medium=email&utm_source=salesforce&utm_campaign=special+reports

12. RBC Report
Source - https://thoughtleadership.rbc.com/bold-and-broad-federal-government-
announces-details-for-wage-
subsidy/?utm_medium=email&utm_source=salesforce&utm_campaign=special+reports

13. Justin Trudeau Small Business Tax cheats
Justin Trudeau and Bill Morneau have trust
funds that design in a way to shelter tax. Yet
Trudeau says small business are tax avoidance
schemes
Bill Morneau was told that his small business
reforms where a tax grab
1. Income Sprinkling
2. Passive Income changes
Source -
https://www.slideshare.net/paulyoungcga/what-
party-would-be-better-for-small-business-in-
canada

14. Training and Development
 If you like to learn more
about trade and/or other
subjects as part of your
professional learning and
development then feel
free to review my
material on
https://www.udemy.com/
(search Paul Young CPA
CGA)
 These subjects address
how to fixed issues with
housing and/or systemic
issues related to economy
including government
policies

15. Summary
 Government has closed all Service Canada location. The wait time can be hours to file the Record of Employment
 Hussen is over Service Canada. Hussen was a disaster with the immigration file -
https://nationalpost.com/news/politics/canadas-rigid-asylum-system-unable-to-respond-to-spikes-in-refugee-claims-
auditor-general-finds. Liberals seldom if ever implement any suggestion by either PBO or Auditor General
 Private sector needs funds now and not in 6 weeks
 Not all private sector companies are either structure the same or have been impacted by COVID-19 the same
way. There needs to be more focus on the needs of businesses. During 2009 recession the government support
many large corporations. There should have been better programs for small to medium businesses.
 Federals should have work with provinces to see what was best to support businesses
 Trudeau has habit of pushing things out without proper business cases including working with all stakeholders -
https://www.slideshare.net/paulyoungcga/what-is-going-on-with-canadas-competitiveness
 Liberals are moving forward with carbon taxation – 50% increase
 Source - https://www.slideshare.net/paulyoungcga/truth-about-emissions-and-carbon-pricing
 Liberals record on open, transparent and accountable government have been a disaster -
https://www.slideshare.net/paulyoungcga/has-justin-trudeau-been-open-and-transparent
 The Liberal plan has too many holes in terms of subsidies
 CRA must review the Private Sector Sales report (CRA already has limited resources)
 Businesses run on cash flow including collection of invoices. The government does not the recognize any cash flow issues