Scheer unveils tax-free parental benefits plan
OTTAWA — Andrew Scheer says a Conservative government would make parental employment insurance benefits taxfree.
Scheer announced the policy at a campaign-style news conference in Toronto on Tuesday. The Conservative party estimates a Canadian parent earning $50,000 per year would save about $4,000 in taxes.
The policy is similar to a private member’s bill the Conservative leader introduced last year. It was defeated in the House of Commons in June 2018. An analysis by the independent Parliamentary Budget Officer estimated that the plan would have cost $607 million in 2018-19.
Because the benefit could carry over if a new parent wasn’t taxed that year, the PBO estimated a “future liability” of $261 million in subsequent years.
“The government shouldn’t tax parents for the time they take to care for and bond with their new child when they’re already making such a huge sacrifice,” said Scheer, flanked by two mothers and their children at a child-care centre on Danforth Ave.
His announcement comes as the pre-election race begins to heat up after a relatively quiet summer of politicians on the barbecue circuit.
In the Greater Toronto Area — a battleground both the Liberals and Conservatives believe will be decisive in electing the next government — the Tories are pushing an affordability message, trying to make the case that a Scheer government would be better for Canadians’ pocketbooks.
The Conservative plan would introduce a non-refundable tax credit of 15 per cent for any income received from employment insurance parental benefits.
The program would introduce an equivalent credit for parents in Quebec who receive payments from the Quebec Parental Insurance Plan.
New parents who don’t pay taxes while on parental leave would be able to carry forward the credit for future years.
Earlier this year, the Liberal government boosted the payout from the Canada Child Benefit to a maximum of $6,639 for each child under 6, and $5,602 for children between 6 and 17. The Liberals have tied increases in the benefit to the rate of inflation.
According to the government, the Canada Child Benefit has reduced the number of children living in poverty by 278,000 since the Liberals introduced the increased benefit in July 2016. It replaced the former Conservative government’s universal child benefit.