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Charlie Herrera Vacaflor, Employment Law & HR Content Senior Consultant
(Last updated )
Charlie Herrera Vacaflor, Employment Law & HR Content Senior Consultant
(Last updated )
In response to the escalating trade tensions with the United States, on April 7, 2025, the Ontario government has unveiled an $11 billion support plan aimed at shielding workers and businesses from the fallout of U.S. tariffs. This comprehensive package aims to alleviate financial pressures for small and medium-sized enterprises (SMEs) across the province, providing crucial support for employee management and financial stability in the face of ongoing commercial uncertainty.
The cornerstone of this relief program is a $9 billion tax deferral initiative, allowing businesses to postpone payments on key provincially administered taxes for six months. This measure would apply to approximately over 80,000 Ontario businesses and covers taxes such as the Employer Health Tax, Fuel Tax, Mining Tax, and Beer/Wine/Spirits Tax. This Tax Deferral will apply retroactively from April 1, 2025, to October 1, 2025. Thus, all taxes owed must be paid by October 1, 2025.
For SMEs, this translates into improved cash flow during a critical period, enabling them to maintain operations, retain employees, and navigate the economic uncertainty caused by the trade escalation.
In addition to the tax deferrals, Ontario is offering an additional $2 billion rebate for eligible businesses through the Workplace Safety and Insurance Board (WSIB), building on the $2.5 billion rebate announced in November 2024 This rebate is designed to incentivize businesses to maintain and hire workers by providing direct cash relief for safe employers. It will help businesses offset operating costs, ensuring they can keep workers employed while navigating the economic challenges triggered by global trade tensions.
These relief measures are designed to provide immediate support for businesses that are feeling the pinch from ongoing trade tensions and tariffs. The tax deferral gives companies more flexibility, allowing them to free up cash flow to cover operational costs, retain workers, and plan for future growth.
The tariff relief program indirectly supports employee management in several ways:
In addition to the Ontario program, Ontario organizations may benefit from this federal initiative designed to help Canadian businesses navigate the economic challenges posed by the recent U.S. tariffs. Launched in March 2025, this program allocates $5 billion over two years to support Canadian exporters facing trade disruptions.
To qualify for the Trade Impact Program, your small or medium-sized enterprise must:
All other forms of business relationships and structures are not eligible. This includes:
Effective March 7, 2025 through March 6, 2026, the federal government has implemented significant temporary special measures to the Employment Insurance Work-Sharing Program in response to the economic challenges posed by U.S. tariffs. These measures aim to help businesses avoid layoffs while maintaining their workforce during this period of trade uncertainty.
To access the Work-Sharing Program benefits, employers must submit the following documentation:
The Employment Insurance (EI) Work-Sharing Program helps Canadian employers mitigate the economic impact of tariffs escalation with the U.S. in several important ways. Mainly, it assists in preserving skilled workforce. Businesses are better able to retain skilled employees who might otherwise be temporary laid off or terminated. It also maintains institutional knowledge and reduces future rehiring and retaining costs. From a financial standpoint, the changes introduces to this federal program reduces payroll costs while maintaining employment relationships; that is, employees receive EI benefits for the hours they’re not working, supplementing their reduced income. Thus, it helps businesses manage cash flow during period of reduced revenue.
The WSIB rebate offers direct financial support for Schedule 1 businesses that prioritize workplace safety, allowing eligible companies to receive money back on their premiums. This helps them continue operating smoothly and efficiently, even amid economic uncertainty. For businesses in industries like trucking, where maintaining a clean CVOR record is essential for operational success, these measures can ease financial pressures and help maintain compliance with regulatory requirements.
As the Ontario and Federal governments steps in to provide critical financial relief, it’s important for businesses to make the most of these support initiatives. At Peninsula, we offer expert guidance on how to leverage these measures effectively. Whether you’re looking to manage your workplace safety program, stay compliant with tax regulations, or optimize your CVOR record to avoid penalties, we’re here to help.
Contact Peninsula today at (1) 833 247-3652 to discuss how we can assist you in navigating these changes and securing your business’s financial health during this challenging period.
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