Employment Minister Carla Qualtrough said today she feels “sorry” for Canadians who have applied for Canada’s Emergency Response Benefit thinking they have met the minimum income requirement, only to learn they might now have to repay thousands of dollars.
But while the minister told CBC News that “nothing is off the table,” the government is not considering letting everyone who applied in good faith off the hook, as the NDP and Green Party have suggested.
“There’s not a conversation happening right now where we would forgive people, where we would not require people who were not eligible to pay it back. No,” she said.
In recent weeks, approximately 441,000 Canadians have received an “educational letter” from the Canada Revenue Agency (CRA) asking for more information to determine if they meet the income eligibility criteria for the CERB payments they get or not.
Many people facing the potential of repaying their CERB benefit argued that the government was not clear about how they defined “income”.
CERB filing requires Canadians attest that they have earned “at least $ 5,000 (before tax) in the past 12 months or in 2019 …”
Some self-employed Canadians said they believe that means all income, as there is no mention of costs. CRA asserts that self-employment income always refers to “net income, before taxes,” or gross income minus expenses.
Qualtrough said the government updated some information when questions were submitted, but there was no change in government policy. She points out that benefits such as GST credit or Child Welfare Canada are also based on the same definition of income.
“I had thought myself I had been pretty clear in my communications,” she said. “But obviously, if people misunderstood, that’s on us. It’s up to us to communicate these programs, as complex as they are.”
The minister said she hopes many Canadians who received letters from the CRA will ultimately find out they don’t have to repay. She said she feels bad for those who do.
“Of course, I feel bad. We all feel bad,” said Qualtrough, noting the CERB program in particular was designed to help those in “horribly difficult and uncertain circumstances” because of the pandemic.
She suggested that the government might find ways to reduce the financial hardship of recouping this benefit.
While the CRA letter advises debtors to be repaid by December 31, the agency says it is for tax purposes and does not mean the due date.
Late repayment may increase taxpayers’ income by 2020 and affect your entitlement to credits and benefits.
The CRA has not been able to recover new loans since the pandemic began. The agency said it will resume collection operations “when it is their responsibility to do so.”
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