Proposed $2,000/month Canada Emergency Response Benefit | General financial discussion | Discussion forum

Bill C-13 received royal assent yesterday.

Final version is at Bill C-13 (Royal Assent). The Canada Emergency Response Benefit Act is in Part 2 of the bill.

Not everyone will get the $2,000/month CERB benefit. The benefit is only intended for workers, as defined in the Act.

Initially, "worker" is defined as follows. Need to have at least $5,000 of certain income:

worker means a person who is at least 15 years of age, who is resident in Canada and who, for 2019 or in the 12-month period preceding the day on which they make an application under section 5, has a total income of at least $5,000 — or, if another amount is fixed by regulation, of at least that amount — from the following sources:

(a) employment;

(b) self-employment;

(c) benefits paid to the person under any of subsections 22(1), 23(1), 152.‍04(1) and 152.‍05(1) of the Employment Insurance Act; and

(d) allowances, money or other benefits paid to the person under a provincial plan because of pregnancy or in respect of the care by the person of one or more of their new-born children or one or more children placed with them for the purpose of adoption.‍ (travailleur)

Bill said
Norman1, does Part 1 section 4 mean the minimum rrif withdrawal amount for 2020 is reduced by 25%? (Doug, I'm not old enough to have a rrif.)

It appears the benefit is taxable, but Part 1 2(1) appears to give you a related additional credit, with some kind of clawback calculation for higher earners, on your income taxes for 2020. Do you agree, Norman1?

Also Part 4 has some reference to CDIC limit changes until October - ?

I think the summary at the beginning of the bill answers those questions:

SUMMARY

Part 1 implements, as part of the response to the coronavirus disease 2019 (COVID-19), certain income tax measures by

(a) introducing a one-time additional payment under the GST/HST tax credit;
(b) providing temporary additional amounts under the Canada Child Benefit;
(c) reducing required minimal withdrawals from registered retirement income funds by 25% for 2020; and
(d) providing eligible small employers a temporary wage subsidy for a period of three months.

Part 2 enacts the Canada Emergency Response Benefit Act to authorize the making of income support payments to workers who suffer a loss of income for reasons related to the coronavirus disease 2019.

…

Part 4 amends the Canada Deposit Insurance Corporation Act to allow the Minister of Finance to increase the deposit insurance coverage limit until September 30, 2020.
…

I think that additional tax credit you saw, Bill, was the additional GST/HST tax credit.

Summary says the amendments to the CDIC Act empowers the Minister of Finance to temporarily boost the CDIC coverage limit without going through Parliament (House of Commons ⟹ Senate ⟹ Royal Assent) again, until end of September. That power has not been exercised yet. So, CDIC limit is still $100,000:

Duty to insure
12 The Corporation shall insure each deposit with a member institution except

(a) a deposit that is not payable in Canada or in Canadian currency;

(b) a deposit in respect of which Her Majesty in right of Canada would be a preferred claimant; and

(c) so much of any one deposit as exceeds one hundred thousand dollars the amount set out in subsection 12.‍01(1).

Amount
12.‍01 (1) The amount referred to in paragraph 12(c) is one hundred thousand dollars, unless the Minister determines a greater amount, in which case the amount referred to in that paragraph is the amount that the Minister determines.

Publication in Canada Gazette
(2) As soon as feasible after making a determination under subsection (1), the Minister shall publish the amount in the Canada Gazette.

My guess is that the power would be used to neutralize any attempts to cause a run on one of the big banks that depositors routinely have over $100,000 deposited in. I'm thinking of those sleazy short sellers who tried to bring down Home Trust by spreading rumours and half-truths.