The federal government is increasing a payroll subsidy to small businesses to try and reduce layoffs due to COVID-19.

Prime Minister Justin Trudeau says the government will now cover up to 75 per cent of salaries, a major increase over the original 10 per cent subsidy plan.

“Last week, we had announced that we would cover 10 per cent of wages, but it is becoming clear that we need to do much more,” said Trudeau on Friday morning from Ottawa.

“We’re bringing that percentage up to 75 per cent for qualified businesses.”

The subsidy will be retroactive to mid-March and is part of a suite of small business measures being rolled out today.

The Bank of Canada has also slashed their prime lending rate to 0.25 per cent in reaction to the COVID-19 pandemic.

(CP/CJGX)