Just one more welfare program that will discourage work, especially for second workers in a family

You can save this article by registering for free here. Or sign-in if you have an account.

Prime Minister Mark Carney this week announced a boost in the GST tax credit to help Canadians with affordability. With its name being changed to the “Canada Groceries and Essentials Benefit,” the refundable GST credit paid to low-income Canadians is being turned into yet another welfare program that will discourage work, especially for second workers in a family.

Subscribe now to read the latest news in your city and across Canada.

Subscribe now to read the latest news in your city and across Canada.

Create an account or sign in to continue with your reading experience.

Create an account or sign in to continue with your reading experience.

Beginning April 1, the GST low-income credit will be topped up by 50 per cent in the first year and 25 per cent for the following four years. For a single person, the maximum annual payment will be $950 in 2026-27 and, assuming no future inflation, $683 in each of the next four years. For a married couple with two children the maximum payment will be $1,890 in the first year and $1,357 the next four. Once the family’s income reaches about $46,300, the credit is taxed away by five cents for every new dollar of earnings — thus acting like a tax on those earnings.

Get the latest headlines, breaking news and columns.

By signing up you consent to receive the above newsletter from Postmedia Network Inc.

A welcome email is on its way. If you don't see it, please check your junk folder.

The next........

© Financial Post