Government's Initial Response to U.S. Tariffs Targets Manufacturing, Agriculture, and Exports

The federal government announced its initial set of support measures in response to the recently imposed U.S. tariffs. At this time, these measures focus specifically on industries directly affected by the tariffs, like manufacturing and agriculture.

Finance Minister Dominic LeBlanc, alongside several cabinet colleagues, unveiled a $6.5 billion support package focused primarily on exporters, manufacturers, and agricultural producers directly impacted by the tariffs.

Travel Industry Not Included in Initial Tariff Support Measures

ACTA notes that as service providers rather than manufacturers, exporters, or agricultural producers, most travel businesses will not qualify for many of the “tariff focussed” funding programs announced today.

The travel industry, which is still recovering from pandemic-related disruptions, faces potential secondary impacts from these tariffs, including reduced cross-border travel and tourism spending.

Key Elements of the Federal Announcement

The federal support package announced today includes:

  • A $5 billion Trade Impact Program through Export Development Canada
  • $500 million in loans through the Business Development Bank of Canada for tariff-impacted businesses
  • $1 billion in financing through Farm Credit Canada for the agricultural sector
  • Updates to the Investment Canada Act Guidelines to protect Canadian companies from harmful takeovers
  • Enhanced EI Work-Sharing Program flexibilities (travel businesses may be eligible)

EI Work-Sharing Program – Special Measures Details

The EI Work-Sharing Program has introduced temporary special measures specifically to support Canadian businesses impacted by the potential or realized effects of U.S. tariffs. These measures, effective from March 7, 2025, to March 6, 2026, aim to help eligible employers maintain operations and avoid layoffs during this challenging period.

Employers are eligible for Work-Sharing special measures if they have operated in Canada for at least one year, employ at least two EI-eligible employees who agree to reduce their hours and share the available workload, and have experienced business activity reductions directly or indirectly related to the U.S. tariffs. Businesses eligible under these special measures include those new to the Work-Sharing program, those already holding existing agreements, and employers currently in a mandatory cooling-off period.

The program offers several key flexibilities: agreements must initially last a minimum of six weeks and may be extended up to 76 weeks if necessary; the mandatory cooling-off period between successive agreements is temporarily waived; and recovery measures specifically focus on supporting business viability impacted by the tariffs.

Additionally, employee eligibility has expanded to include seasonal, cyclical, part-time employees, and those employees directly involved in supporting recovery efforts for affected businesses.

Employer travel agencies interested in this program can learn more here.

Independent Travel Advisors

Independent travel advisors (ITAs), who primarily operate as self-employed contractors, are currently not eligible for the EI Work-Sharing Program. This is because eligibility requires participants to be employees contributing to Employment Insurance (EI). Consequently, ITAs do not qualify for this program, leaving them outside the scope of the current government measures related to the U.S. tariffs.

ACTA is actively monitoring the evolving needs of ITAs. ACTA continues to advocate with government representatives and industry suppliers to secure targeted support and ensure that the unique circumstances faced by ITAs are recognized and addressed as the situation evolves.

Canada Small Business Financing Program: A Potential Option for Cash Flow Needs

For businesses in need of cash flow support, the Canada Small Business Financing Program (CSBFP) may be a potential option for travel agencies and independent travel advisors. This program makes it easier for small businesses to get loans from financial institutions by sharing the risk with lenders.

Over the past 10 years, small businesses have received over 53,000 CSBFP loans totalling $10 billion dollars.

Eligibility:

  • Small businesses or start-ups operating in Canada, with gross annual revenues of $10 million or less.

Available financing:

  • The maximum loan amount for a borrower is $1.15 million.
  • Up to a maximum of $1,000,000 for term loans for any one borrower, of which no more than $500,000 can be used for purchasing leasehold improvements or improving leased property and purchasing or improving new or used equipment and of that amount, a maximum of $150,000 could be used for intangible assets and working capital costs.
  • Up to a maximum of $150,000 for lines of credit.

For more information on the CSBFP, visit: Canada Small Business Financing Program

Provincial and Territorial Relief Programs

ACTA has conducted a thorough review of all provincial and territorial relief programs, and at this time, does not believe there is anything available yet specifically for travel agencies or independent travel advisors in response to the U.S. tariffs. The organization continues to monitor developments at all levels of government.

ACTA Advocacy Continues

ACTA is currently assessing the full impact of the U.S. tariffs on the Canadian travel industry. The situation is rapidly evolving, and ACTA is closely monitoring developments while engaging with government officials to advocate for support that addresses the unique needs of travel agencies and independent advisors.

ACTA is strongly encouraging members to email Avery Campbell, Director of Advocacy and Industry Relations ([email protected]), with insights on how their businesses are being impacted by the U.S. actions.

Looking Ahead

The federal government has indicated this announcement represents only the first phase of Canada's response to the U.S. tariffs, with additional measures to be unveiled in the coming weeks.

Travel industry stakeholders are encouraged to monitor ACTA communications for updates on advocacy efforts as the situation continues to develop.