Quebec to dole out $2.5B in businesses loans, Montreal delays tax deadline in efforts to boost economy

The provincial government and the City of Montreal rolled out more financial aid Thursday for businesses and individuals dealing with an economy that's stalling under public health measures to prevent the spread of COVID-19.

Quebec announced it's making $2.5 billion available for businesses, much of that to be delivered in the form of loans and loan guarantees, Economy Minister Pierre Fitzgibbon said.

He said in order to qualify for the loans, businesses will have to demonstrate their sales are hurting because of the pandemic. Fitzgibbon also raised the possibility of the government easing conditions on pre-existing business loans.

The announcement came as one the province's marquee businesses, Cirque du Soleil, laid off nearly everyone in its head office. In all, the company has had to lay off 4,500 employees, about 95 per cent of its payroll.

Economists in the U.S. are already starting to declare the global economy is in a recession because of the COVID-19 outbreak. The Toronto Stock Exchange, meanwhile, has lost about a third of its value in the last three weeks.

But on Thursday, Quebec's finance minister, Eric Grirard, offered what was, by comparison, an optimistic view of what the provincial economy is experiencing.

"What we're seeing is disruption, interruption. It's not destruction," Girard said in Quebec City. "So yes, there is a pause. Some sectors from the economy are struggling, and we're there to help."

Premier François Legault said Quebec consumers could play a role, too, in helping the economy offset coronavirus losses. 

"Please, in the following weeks, the following months, it's more important than ever to buy products made in Quebec," Legault said. "That includes purchases online. More than ever, we have to be able to encourage Quebec businesses."

Property tax deadline extended

In Montreal, the local administration is pushing back the next property tax deadline, delaying the collection of roughly $2 billion in city revenues. Similar deferrals have already been offered for provincial and federal tax deadlines.     

Mayor Valérie Plante said pushing back the June 1 deadline by one month is as much as the city can afford to do before having to cut services to the public.

"This extension is valid for all Montreal property owners, both residential and commercial," Plante said Thursday, calling it an "unprecedented financial effort" by the city.

Plante also announced a six-month moratorium on capital and interest payments for certain municipal loan programs.

She estimated the measure would free up $6 million in cash flow for nearly 700 small- to medium-sized businesses. Montreal will absorb interest payments worth $1.3 million.

Montreal is also investing $5 million in socio-economic, creative, tourism and cultural industries. In addition, $1 million will be invested in local initiatives that could help limit the spread of COVID-19, such as helping small businesses to offer delivery options.