New Government Support for Businesses affected by U.S. Tariffs

March 24, 2025

Sector:

Canadian Federal Government Announces Major Support Measures for Businesses Impacted by U.S. Tariffs

As a Canadian Chartered Accountant, it is my responsibility to keep businesses informed about the evolving economic landscape and the government programs designed to support you. The Federal Government has unveiled strategic new initiatives, including the expansion of the Employment Insurance (EI) Work-Sharing Program and a robust $6.5 billion aid package. These measures are specifically targeted to help Canadian businesses mitigate the adverse impacts of recent U.S. tariffs while ensuring workforce stability and promoting long-term growth.

For personalized guidance on how these programs may affect your business, please contact Kreston GTA.

H2: Overview of Federal Support Programs for Businesses Impacted by U.S. Tariffs

In response to the recent escalation of U.S. tariffs, the federal government has rolled out comprehensive assistance measures. Below is a technical breakdown of the available support, eligibility criteria, and the potential benefits for Canadian businesses.

H3: Expansion of the Employment Insurance Work-Sharing Program (2025–2026)

Work-Sharing Programs are essential tools for businesses facing temporary reductions in business activity. Rather than resorting to layoffs, employers can reduce employees’ working hours, allowing them to share available work while Employment Insurance provides supplemental income.

Key Features of the Expanded Work-Sharing Program:

• Eligibility Period: March 7, 2025, to March 6, 2026
• Business Types: Now includes non-profit organizations and charities, as well as for-profit businesses
• Employee Criteria: At least two EI-eligible employees willing to reduce their working hours and share available work
• Seasonal Workers: Expanded to include both seasonal and year-round employees
• Agreement Duration: Up to 76 weeks with no required cooling-off period between agreements
• Flexible Usage: Available to employers with at least a 10% decrease in business activity over the past six months, with utilization possible below 60% work reduction

For more detailed guidance on work-sharing eligibility, visit our Canadian Payroll Services page for professional support.

H3: $6.5 Billion Federal Aid Package for Impacted Businesses

To further support Canadian businesses navigating the complications of U.S. tariffs, the government has introduced a $6.5 billion financial assistance package via three key Crown corporations:

• Export Development Canada (EDC): $5 billion over two years to help exporters adapt and remain competitive
• Business Development Bank of Canada (BDC): $500 million in loans and deferrals geared towards small and medium-sized enterprises (SMEs)
• Farm Credit Canada (FCC): $1 billion in additional credit to support agricultural and food businesses

This capital infusion aims to maintain liquidity, safeguard jobs, and drive innovation across multiple sectors.

H3: Quebec-Specific Support Measures

Quebec businesses impacted by U.S. tariffs can access a variety of unique support programs, which include:

1. Investissement Québec’s FRONTIÈRE Program

• Purpose: Provides up to $50 million per company in liquidity loans for manufacturers and primary sector exporters directly affected by tariffs
• Terms: 7-year loan term with a 24-month principal deferment

2. The ESSOR Program & Productivity Component

• Purpose: Offers interest-free loans and non-repayable contributions to projects over $10 million, targeting productivity and market diversification

3. Panorama Financing and Support Program

• Purpose: $200 million initiative providing working capital for Canadian and international sales expansion (excluding the U.S.), with loans from $250,000 to $1 million

4. Grand V Initiative

• Purpose: Focuses on accelerating innovation with flexible financing and up to 1,000 hours of technical support

5. CPMT ‘Formation pour la résilience et la compétitivité en emploi’

• Purpose: Skills development for employees to boost resilience and competitiveness in response to tariffs

6. CDPQ’s Program for Québec Businesses

• Purpose: Supports new projects in productivity, automation, and market entry, with flexible financing and support for technological transformation

For further reading on government business support in Quebec, review our Quebec Tax Advisory page.

H3: Technical Considerations and Strategic Recommendations

Leveraging Federal and Provincial Support

With the expansion of these federal and provincial programs, businesses should:

• Assess Eligibility Rigorously: Confirm that your business meets all criteria for each support measure, including duration of operations, employee eligibility, and sector-specific requirements.
• Maintain Robust Documentation: Accurate financial records and employment data are essential for a successful application and future audits.
• Integrate Strategic Planning: Use available funding to invest in automation, R&D, market diversification, and employee upskilling to future-proof your operations.

Maximizing the Impact of Support Programs

Working with a skilled advisory team, such as Kreston GTA’s experts, can ensure that your business not only accesses these support programs but also leverages them for sustainable growth and competitiveness.

Frequently Asked Questions (FAQ)

1. Who is eligible for the expanded Employment Insurance Work-Sharing Program?
Businesses (including non-profits and charities) with at least two EI-eligible employees who agree to reduced hours are eligible. Seasonal and year-round employees are included.

2. What financial support is available for SMEs affected by U.S. tariffs?
The BDC is offering $500 million in loans and payment deferrals, while EDC and FCC provide additional resources for exporters and agricultural businesses, respectively.

3. Are there special programs for Quebec businesses?
Yes. Quebec offers multiple programs through Investissement Québec and CDPQ, including liquidity loans, productivity funding, and strategic market diversification support.

4. How can businesses apply for these federal support programs?
Applications are typically submitted through Service Canada, EDC, BDC, or FCC. Thorough documentation and eligibility confirmation are crucial.

5. Where can I get expert help to navigate these programs?
Reach out to Kreston GTA for tailored advice and assistance in maximizing the benefits of these support measures.