New legislation has problems
This week the House of Commons is back in session in Ottawa.
The government has introduced two bills intended to provide relief for some Canadian families struggling with higher interest rates and inflation.
The two bills are C-30 “An Act to amend the Income Tax Act (temporary enhancement to the Goods and Services Tax/Harmonized Sales Tax credit)” and Bill C-31 “An Act respecting cost of living relief measures related to dental care and rental housing”.
Bill C-30 proposes to raise the GST rebate to a low-income earner by 50% of what they normally would receive on their GST rebate.
This one-time measure, over the proposed 6-month time frame, will cost the treasury $2.5 billion.
What would the increase in the GST credit look like?
Here are a few hypothetical situations:
A low-income senior couple with a combined annual income of $45,000 would receive an additional $353.30.
A single student who makes $25,000 would receive an additional $612.
A single parent with one child and $45,000 in net income would receive an additional $257.15 .If they earned $50,000, that additional payment would go down to $132.15.
However, if that single parent earned above $55,000 in net income, they would receive no payment.
Similarly, a couple with two children and $45,000 in net family income would receive a reduced extra payment of $337.65 (compared to $467 at $35,000 in net income), would receive $87.65 at $55,000 net family income.
The GST credit increase is completely phased out at a net income of $58,500 or above.
Bill C-31 proposes a two-year dental benefit for children under 12 that would provide a maximum of $650 a year per child, for two years, for families earning less than $70,390 a year.
Families that have an income between $70,390 and $90,000 would see the benefit reduced to somewhere between $390 down to $260, depending on the income cutoff.
What is interesting is that thus far the Liberals are proposing that this dental benefit would be “provided upfront, before the child sees the dentist, and parents won’t have to automatically submit receipts or return any unused money…” as reported by the National Post.
It should be noted that dental care programs for low-income children already exist in all provinces and territories except Manitoba and the Northwest Territories and almost 70 per cent of Canadians have dental coverage.
This creates two challenges.
Without any type of verification process the program could be open to abuse and fraud.
Secondly, without any verification or billing information being required, there is no opportunity for the government to compile data that can be used to assess and monitor how well this program is actually working.
The Canadian Dental Association has stated that “the federal government can best ensure funding will quickly and efficiently benefit those Canadians who need it most: namely, by collaborating with provinces and territories to stabilize and enhance existing provincial and territorial dental care programs.”
While this advice is reasonable the Trudeau Liberal Government has not followed it.
Scotiabank has also said that these new spending announcements will increases the likelihood the Bank of Canada will need to raise interest rates above 4%.
If that occurs, it will financially punish many citizens who will not benefit from these proposed new programs.
My question this week:
Are you supportive of Bill C-30 and C-31?
I can be reached at Dan.Albas@parl.gc.ca or call toll free 1-800-665-8711.
9/26/2022 05:43:07 pm
I note that, in reading the Bill C-31 on the govt of canada website, that documentation will need to be provided through CRA. Even though, according to your stats, 70% of Canadians do not have a dental plan, I would be interested to know the proportion of low income families this includes. I estimate that number to be high. I would vote in favour of the bill. Some
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Dan Albas is the Member of Parliament for the riding of Central Okanagan-Similkameen-Nicola.
Central Okanagan – Similkameen – Nicola