British Columbia

B.C. brewery says it was denied COVID-relief funds because of CRA clerical error

A brewery in Langford, B.C., says it hasn't received any financial help during the COVID-19 pandemic because of a clerical error by the Canada Revenue Agency.

‘I haven’t collected a cent,’ says brewery owner who donates profits to veterans’ programs

V2V Black Hops Brewery in Langford, B.C., was set to launch on March 20, but had to delay when COVID-19 restrictions came into effect on March 15. (V2V Black Hops Brewing/Twitter)

A new brewery in Langford, B.C., says it hasn't received any financial help during the COVID-19 pandemic because of a clerical error by the Canada Revenue Agency.

V2V Black Hops Brewery, which gives part of its proceeds to military and first responders' PTSD programs, says it was denied funding from Ottawa's Canada Emergency Wage Subsidy even though it has had employees on its payroll since mid-February and should qualify for the program.

"I haven't collected a cent," said the brewery's CEO Graham Hafey. "I've stopped paying the brewmaster, we're both volunteering and it's all because of a clerical error that was made by the CRA."

The CEWS provides a subsidy of up to 75 per cent of employee wages for businesses that had a Canada Revenue Agency payroll account on March 15.

Hafey says he's been paying at least one employee since February 15 and had submitted payment information to the CRA long before the deadline. However, he says the agency rejected his application to receive the wage subsidy because it didn't register his payroll number until after March 15.

"By the time it was registered properly it was in April and they completely dismissed it."

New businesses ineligible for help

The CRA said that they can't comment on the specifics of V2V Black Hops Brewery's situation because of confidentiality.

In an email to CBC News, the agency simply reiterated the criteria required for businesses to be eligible for the CEWS that can be found on its website.

Other new businesses are facing similar challenges in accessing federal support to help them stay afloat during the pandemic.

Nomina Wellness was set to launch a new mental health treatment centre in the Comox Valley on April 1, but had to delay the opening when pandemic restrictions came into effect in March.

Nomina cannot apply for CEWS because it hadn't opened yet. Neither it or V2V can access a loan from other federal programs like the Canada Emergency Business Account because they didn't have a payroll account registered with CRA last year.

Nomina's operations manager, Steve Eykelenboom, said he wished there was more the federal government could offer to new businesses like his.

"If there's a business that you want to try and help survive in all of this I think it would be something that is dedicated to mental health because there's a looming tidal wave that's about to come down on our society," Eykelenboom said.

Hafey says since being rejected he's submitted additional proof of payroll to the CRA as well as to his local MP's office.

In an email statement, NDP MP Alistair MacGregor, who represents Cowichan—Malahat—Langford, says he raised the issue to the House of Commons COVID-19 Pandemic Committee in June, asking the minister of National Revenue, Diane Lebouthilier, to resolve it.

NDP MP Alistair MacGregor rises during Question Period on Parliament Hill, in Ottawa on Friday, Feb. 17, 2017. (Justin Tang/Canadian Press )

MacGregor says he also sent a follow up letter to Lebouthilier in July.

"The existing criteria for CEWS are too restrictive and New Democrats are pushing for changes to make the program more flexible," said MacGregor in the email statement.

"It is my hope that the Honourable Minister will review this particular case and fix its payroll issue so that V2V Black Hops Brewery will be able to qualify for the CEWS and continue its operations to the benefit of veterans."

In the meantime, Hafey feels that the CRA is preventing him from running a successful business. His revenue is limited because bars and restaurants haven't been purchasing beer kegs in the same quantities as they would have pre-COVID.

"It shouldn't be about semantics when the success or failure of my business hangs in the balance with no government benefits whatsoever." 

He says while the government has stepped in to help established businesses, new ventures like his are even more vulnerable to going out of business.