Self-employed Canadians who are being asked to repay the Canada Emergency Response Benefit after a Canada Revenue Agency error are scaling up their pressure on the government to allow them to keep the benefit.
On Wednesday, Green Party MP Paul Manly presented a petition to the House of Commons that received more than 7,000 signatures over a month, asking the government to allow self-employed CERB recipients to retroactively use their gross self-employed income instead of net to assess their eligibility for the benefit.
Manly, who sponsored the petition, said in an interview he’s heard from self-employed Canadians across the country who applied for CERB “in good faith” and are now being told they didn’t qualify.
In early December, when 441,000 Canadians received letters telling them they may have to repay the benefit, many self-employed recipients found out for the first time that they were supposed to base their eligibility on net self-employed income — meaning after expenses — and not gross.
But they said this had not been made clear in the eligibility requirements posted online, or by CRA agents themselves.
Manly said the government needs to own up to its error and allow these CERB recipients to keep the benefit, noting that many of them don’t have the means to pay it back.
“The government’s made a huge mistake with this,” he said.
In an emailed statement, the press secretary for Employment Minister Carla Qualtrough said the government is “actively looking at options to respond to the concerns raised by some self-employed Canadians about the eligibility criteria for the Canada Emergency Response Benefit (CERB) and the information they received. We will have more to say very soon.”
The Star reported that some CRA agents themselves were confused about the eligibility requirements for self-employed Canadians, and told numerous applicants over the phone that they should consider their gross self-employed income for eligibility purposes, not net. The Star also reported that the CRA’s website did not mention this distinction until sometime between April 21 and 25, even though applications for the benefit opened April 6 — and despite a CRA spokesperson telling the Star that the “requirement was publicized on Canada.ca since the beginning.”
Later in December, the CRA admitted to iPolitics that “communications on this topic were unclear in the first days after the CERB was launched,” after the union that represents CRA agents confirmed call centre workers were given incorrect information about eligibility for self-employed individuals.
But despite this, and pressure from multiple parties to do so, the government has said it will not waive repayments for self-employed CERB recipients affected by this confusion.
In an emailed statement, a CRA spokesperson said that the CRA “is sensitive to cases of hardship for Canadians still facing the financial impacts of COVID-19.”
“The CRA is also sympathetic to the fact that, for some individuals, repayment of emergency benefits may have financial implications,” said the spokesperson. “The Government of Canada will have more information on this shortly.”
Holistic nutritional clinical practitioner Tammy Seed is one of the CERB recipients who thought she qualified based on her gross self-employment income. She said she called the CRA twice to confirm, and was told by two different agents that she was eligible based on her gross income. Even after she received the letter in December, Seed said when she called the CRA again — multiple times — she was told the same thing.
Almost two months later, Seed said she just wants the government to not only apologize for making a mistake, but to follow that apology by telling self-employed CERB recipients that they can qualify based on the information they were given.
“These people were assured … by CRA agents that they qualified based on gross. They applied in good faith,” said Seed, who received $ 14,000 in CERB benefits.
“These people did nothing wrong.”
In addition to the official government petition, there is a Change.org petition with more than 100,000 signatures asking for the same thing.
Edmonton resident Avery Miller Nawarowska, a yoga teacher and mother, started the petition soon after receiving the letter that hundreds of thousands of others received. She made just over $ 5,000 in 2019 before expenses after taking time off for the birth of her child (as a self-employed person, she doesn’t get maternity or parental leave), and said when she applied for CERB, there was no indication that she didn’t qualify.
“I would have never applied if I thought that I was ineligible, she said.
Miller Nawarowska said she and other self-employed people have been working “day and night” to raise awareness for this issue, and said she’s hopeful their work will pay off. The issue has transcended party lines, she added, gaining support from Green Party, NDP and Conservative MPs.
“We’re not looking for forgiveness, because we never made a mistake,” she said. “We’re looking for justice.”
Manly said it’s clear there’s “huge public support” for the government to forgive self-employed Canadians who received CERB based on incorrect information about their eligibility.
“It’s the right thing to do,” he said, adding that the legislation enacting CERB also does not mention gross income.
NDP MP Daniel Blaikie said it’s “pretty clear” that the mistake is on the part of the government, and not the self-employed CERB recipients, and that the people affected by this issue received the funds because they needed them to get by.
“People can’t pay back money they don’t have,” he said.
This isn’t the only instance of confusion about CERB eligibility. In January, the Globe and Mail reported that artists who received CERB were also being asked to repay the benefit, because grant income — which many artists rely on — did not count as income for eligibility purposes.
Soon after, the Globe and Mail reported that the CRA backtracked on this message, and said it would allow artists to qualify using grant income after all. The agency later clarified to Global News that this would be on a case-by-case basis, depending on how the grant was used.
In an email, a CRA spokesperson said that “despite what was reported the CRA has not changed its position regarding the eligibility of artist grants.”
“From the start of the CERB program, we said that we would take steps at a later time to verify that claimants were eligible to receive payments for any COVID-related economic measures,” said the spokesperson, adding that for many of the people who received the letters about confirming their eligibility, “the solution is to file a 2019 return which will allow the CRA to verify their income.” Some may be found to not qualify for CERB, but “this should not be misconstrued as a change in the CRA’s position or of the eligibility criteria,” they said.
The spokesperson explained that whether grants qualify as income “depends on the artist’s unique situation.”
“The qualifying income from artist grants, for the purpose of CERB eligibility, is based on the amount of the grant less the expenses the grantee has paid or will be paying to other people and businesses. Generally, the grant income will be the fee or subsistence allowance the grantee is paying themselves to undertake the project. In terms of timing, this income is considered ‘earned’ at the time work is performed over the duration of the project, not as a lump-sum payment.”