Chase Miller
Chief Business Development Officer & Co-Founder, Impact Applications
Last Updated
August 25, 2026
Short answer
On August 25, 2026, the Government of Canada announced a $7.5 billion tariff support package. The headline change for Canadian businesses: the Regional Tariff Response Initiative non-repayable cap rises from $1 million to $3 million effective September 2026, and demonstrated liquidity need becomes an eligible use for the first time, with up to $2 million available on that basis alone. Four other measures were announced alongside it.
Last verified August 25, 2026 by the Impact Applications research team against the official Department of Finance Canada news release and backgrounder. How we verify.
What changed on August 25, 2026
Canada suspended trade negotiations with the United States in late August after Washington proposed terms Ottawa was not prepared to accept. The United States imposed a 50 per cent tariff on $27.6 billion of Canadian goods effective August 22. Canada responded with dollar-for-dollar, rate-for-rate countermeasures on $27.6 billion of American goods beginning September 8, at rates of 15, 25 and 50 per cent matching each corresponding US tariff, and paired those countermeasures with $7.5 billion in new and enhanced business and worker supports.
That $7.5 billion sits on top of nearly $25 billion already deployed over the preceding 18 months. It is split across five measures. One of them changes the economics of tariff relief funding for most Canadian manufacturers.
The RTRI change in one table
| Before September 2026 | From September 2026 | |
|---|---|---|
| Non-repayable contribution cap | $1,000,000 | $3,000,000 |
| Liquidity as an eligible use | Not eligible | Eligible, up to $2,000,000 |
| New national funding | $1.5 billion added | |
| Repayable contributions | Up to $5,000,000 via PrairiesCan (ceilings vary by agency) | Unchanged |
| Cost share (incorporated businesses) | Up to 50% of eligible costs | Unchanged |
| Delivery | Seven regional development agencies | Unchanged |
| PrairiesCan application deadline | December 31, 2027 or until funds committed | Unchanged |
| Project completion | March 31, 2028 | Unchanged |
| Retroactive costs | Back to March 21, 2025 | Unchanged |
The full RTRI program guide covers eligibility, cost categories, and the agency-by-agency thresholds in detail. One caution on timing: the regional agencies' own program pages had not yet been updated with the new parameters on announcement day, so the figures above come from the federal announcement rather than agency guidance.
Why the liquidity change matters more than the cap
Tripling the cap is the number people will quote. The eligibility change is the one that will actually move applications.
Until this announcement, an RTRI file needed a project. A pivot into new markets. A capital investment. An automation build. Something forward-looking, scoped, and defensible to a program officer. Companies absorbing real tariff damage but with no capital plan ready to go were structurally hard to fund, because there was nothing to point the money at.
As of September, demonstrated liquidity need qualifies on its own, up to $2 million. A manufacturer bleeding margin on tariffed inputs, carrying receivables it cannot collect fast enough, or holding inventory it can no longer move at the price it planned, now has a fundable position without inventing a capital project to house it.
This is a category change, not a top-up. It widens the qualifying pool substantially and shortens the hardest part of the process, which was always turning a cash flow problem into a project narrative.
The practical caution: liquidity applications will need documentation that is different from what a capex file requires. Expect program officers to want quantified tariff exposure, current and projected cash position, and evidence that the pressure traces back to trade disruption rather than to general business conditions. Guidance for the expanded stream had not been published as of this writing.
The other four measures
Canada Strong Diversification Fund
Effective immediately, with $2 billion in new funding, the Canada Strong Diversification Fund is a new stream of the Strategic Response Fund. It targets tariff-impacted companies with shovel-ready projects that support ongoing capital maintenance, and it explicitly includes medium-sized firms rather than restricting itself to large enterprises.
Two details make this worth watching. It will work closely with regional development agency programming for project intake and triage, so it should feel procedurally adjacent to RTRI. And a fast-track, one-step review and approval process is being implemented, rather than the expression-of-interest-plus-full-application sequence most federal contribution programs require.
"Ongoing capital maintenance" is unusually broad language for a federal fund. Companies that have deferred equipment replacement or facility work because of tariff-driven margin compression should look at this alongside RTRI rather than instead of it.
BDC Pivot to Grow, second liquidity stream
The Business Development Bank of Canada gains a second $500 million liquidity stream inside Pivot to Grow, aimed at working capital for businesses facing cash flow shortfalls caused by tariffs. BDC describes the stream as open now.
- Available to companies directly impacted by tariffs, regardless of sector
- Loans from $250,000 to $5,000,000
- Interest-only payments over 36 months, with 0% interest for the first 12 months
- Amortization over 96 months, and a simplified application process
- Annual revenue floor lowered to $1 million, which also applies to BDC's targeted steel, aluminum and forestry programs
The revenue floor drop is the notable part. It brings companies well below the usual federal contribution program threshold into scope. Note that this is debt, not a contribution. It solves a different problem than RTRI does, and the two can run in parallel.
Workforce Retention and Retraining Program
The EI Work-Sharing program and the Worker Retention Grant merge into a single, more accessible offering. Employers keep access to new and existing Work-Sharing flexibilities and become eligible for additional funds covering training and administrative costs, up to $1,000 per participant.
The dollar figure is small relative to the other measures, but for a manufacturer trying to hold a trained crew together through a demand trough, it lowers the cost of not laying people off.
On the worker side, the package extends the waived one-week EI waiting period by a year, extends the measure allowing workers to collect EI without first exhausting severance or vacation pay by a year, extends the additional 20 weeks for long-tenured workers by eight months, and introduces a temporary one-year measure so workers who voluntarily left a job in recent months are not penalized when their most recent job loss was through no fault of their own.
Large Enterprise Tariff Loan facility
The $10 billion Large Enterprise Tariff Loan facility, administered by the Canada Enterprise Emergency Funding Corporation, gains two flexibilities: liquidity support coverage extends from 24 months to 36 months of company need, and the maximum loan term rises from 10 years to 15 years. No new money was added here.
This is a large-employer instrument. Most small and medium-sized businesses will find RTRI, the Canada Strong Diversification Fund, or BDC a better fit.
Who qualifies for the expanded RTRI
Core eligibility is unchanged by this announcement. Through PrairiesCan, which delivers RTRI in Alberta, Saskatchewan and Manitoba, an applicant must be an incorporated business (companies, corporations and co-operatives), an Indigenous-owned business or organization, or a not-for-profit that supports businesses. The program is open to all sectors; PrairiesCan may give preference to projects with higher proportions of Canadian inputs, greater economic benefits for the Prairies, or support for local, regional or national supply chains. Primary agricultural producers are generally directed to Agriculture and Agri-Food Canada programming instead.
You must demonstrate tariff impact, either by showing that at least 25 per cent of sales sit in markets affected by the tariffs, or by documenting negative effects such as increased input costs, supply chain disruption, revenue decline, lost customers, or employment impacts. The business must have been financially viable before March 21, 2025, supported by at least two complete years of financial statements plus interim statements covering at least the last six months.
Two structural limits worth knowing before you scope a project: applicants are normally limited to one RTRI project, and a business can access the non-repayable stream only once.
If you operate outside the Prairie provinces, your thresholds come from your own agency. Minimum request sizes, headcount requirements, and even repayable ceilings vary meaningfully between PacifiCan, FedDev Ontario, FedNor, CED, ACOA and CanNor. Applying against the wrong agency's criteria is the most common way an eligible business talks itself out of a file.
What to do in the next 30 days
If you already applied to RTRI and were approved at the old cap. Talk to your program officer before September. Amendments to existing contribution agreements are not automatic and are not guaranteed, but a project that was scoped down to fit a $1 million ceiling is exactly the situation the expanded envelope exists to address.
If you started an application and stalled. Reopen it. A project that did not justify the effort at $1 million may clear your internal hurdle at $3 million. Your retroactive cost window still reaches back to March 21, 2025, so costs you have already incurred may remain claimable.
If you have never applied. Start with tariff impact documentation, not with the project. Quantify what tariffs have cost you in dollars and percentages, month over month, with source documents. Every downstream part of the application depends on that evidence being defensible.
If your problem is cash, not capital. Wait for the September guidance on the liquidity stream, but assemble the file now. Current cash position, projected shortfall, aging receivables, and the causal link to trade disruption.
Everyone. Intake closes when the funding is committed, not on the published date. PacifiCan has committed to at least 20 business days of advance notice before closing intake, and other agencies set their own windows. A $1.5 billion injection extends the runway. It does not make it indefinite, and the expanded eligibility means more applicants competing for it.
How these programs stack
RTRI and the Canada Strong Diversification Fund both route intake through regional development agency programming, which means overlapping project scopes will be caught during triage. Structure them as genuinely distinct projects or expect friction.
BDC funding is debt and does not consume contribution program room, so it sits comfortably alongside either.
RTRI also stacks with programs outside the tariff response entirely. SR&ED is a retroactive tax credit on qualifying research and development. IRAP funds research and development projects at up to 80 per cent of salaries. RTRI funds operational and productivity work in response to tariffs. A company running an automation build with a genuine technical uncertainty component can often support both an RTRI file and an SR&ED claim on different portions of the same work.
Total government funding from all levels can reach 90 per cent of project costs for commercial projects. Stacking is never simple addition, and stacking limits are enforced. Our guide to grant stacking strategy covers the mechanics, and the Grant Metal Products case study walks through a real Alberta stack of RTRI, Emissions Reduction Alberta and CanExport that exceeded $2 million.
One more piece of context worth having. This package is a single lane of a much wider federal capital agenda: the same government is funding major defence procurement with dedicated SME programs, bulk orders for factory-built housing through Build Canada Homes, and targeted Strategic Response Fund calls in sectors like food processing. Many tariff-impacted manufacturers will find they qualify under more than one of these agendas at the same time.
Check whether the expanded RTRI fits your business
The $3 million cap and the new liquidity stream change what a viable RTRI file looks like. If tariffs are affecting your business, we will review your exposure, tell you which of these five measures you can realistically access, and estimate your funding in one call. The assessment is free.
Impact Applications is a Calgary-based grant consulting firm. We prepare and manage federal and provincial funding applications for Canadian businesses. For official program details, visit the PrairiesCan RTRI page and the Finance Canada backgrounder. Last reviewed: August 25, 2026.