A pedestrian walks past a closed storefront on St. Catherine street as the COVID-19 pandemic continues to take its toll on local businesses, Thursday, Oct. 8, 2020 in Montreal. THE CANADIAN PRESS/Ryan Remiorz

A pedestrian walks past a closed storefront on St. Catherine street as the COVID-19 pandemic continues to take its toll on local businesses, Thursday, Oct. 8, 2020 in Montreal. THE CANADIAN PRESS/Ryan Remiorz

High-income earners in Canada collected CERB, pandemic-related data shows

Tax policy experts note that many higher-income earners saw their workplaces closed

A key benefit for workers replaced lost earnings for thousands of higher-income Canadians, providing a new glimpse at the scope of federal aid during the COVID-19 pandemic.

The $2,000-a-month Canada Emergency Response Benefit was a key part of the aid package the Liberals rolled out since March, paying out just over $81.6 billion in benefits to 8.9 million people until it ended at the start of October.

It was predominantly used by people who earned under $47,630 in 2019, figures from the Canada Revenue Agency show, but those higher up the income ladder also applied for the benefit program.

The CRA numbers show at least 114,620 people who earned between about $100,000 and $200,000 last year applied for the CERB. Another 14,070 people who had made more than $210,000 applied for the benefit.

Lindsay Tedds, a tax policy expert at the University of Calgary, noted that many higher-income earners saw their workplaces closed and self-employed workers had contracts suddenly cancelled, or invoices left unpaid.

“The point was to replace income that was lost due to the pandemic, lost because of government regulations shuttering the economy to control the virus,” Tedds wrote in an email.

The CERB was available to anyone who had made at least $5,000 in the preceding 12 months, and whose income crashed because of the pandemic, either from a drop in hours or being unable to work.

Filing a tax return wasn’t part of eligibility rules.

The issue earned a spot in the daily question period when the Conservatives asked about 823,580 recipients for whom the tax agency didn’t have 2019 income information at the time it compiled the data.

The figures, in response to a written question, were as of Sept. 23, one week before the tax filing deadline of Sept. 30.

Conservative finance critic Pierre Poilievre said everyone who lost their jobs because of COVID-19-related shutdowns should have received the CERB, but he decried payment to what he called suspected fraud cases.

He asked what the government was doing to ensure “the money didn’t go to people who didn’t earn the right to receive it.”

Finance Minister Chrystia Freeland responded by saying any fraud would be “completely unacceptable.”

“The hardworking public servants in the CRA are doing an outstanding job and they are going to make sure that all claims are legitimate,” she said.

The CRA said in a statement Thursday that “it would be erroneous to conclude” that CERB payments to those without a 2019 tax return were being paid to “fraudsters or to non-eligible individuals.”

It added that officials will be checking claims against upcoming tax returns and payroll records to find any cases of wrongful payments.

People can still apply for back payments of the CERB until Dec. 2.

The latest figures on its replacement, the Canada Recovery Benefit, show the amount in benefits paid has risen to over $2.72 billion given to more than 1.1 million people since it became available in late September.

A wage subsidy program, which has so far paid out $48 billion, and an emergency loan program round out some of the measures the Liberals took to keep employees on payrolls, and companies from going under.

The Senate passed the government’s latest measures for businesses on Thursday, paving the way for a new commercial rent-relief program, extra help to companies subject to lockdowns, and an extension of the wage subsidy program to next summer.

Royal assent was expected later Thursday.

Data from the national statistics agency on Thursday showed companies that used the business loan program in the spring often put the money toward paying wages and suppliers.

Over half of businesses polled by Statistics Canada that received loans early on in the pandemic said the money was key to them keeping their doors open.

In all, 756,115 loans have been approved, valued at $30.24 billion, according to other figures tabled in the House of Commons this week.

The figures are up to Sept. 23, and show construction and retail companies in the top two spots for where the loans have gone by industry. About $9.8 billion in loans went to small businesses with earnings under $65,000.

Jordan Press, The Canadian Press

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