For several years, widow Diane H. has not had to pay up after doing her taxes. But at age 76, she suddenly faces a bill of $66.86. That may not seem like much, but losing her grocery money for a week or more hurts.

The snag she hit this year also impacts seniors like her — those with the least ability to pay.

Why? Due to an outdated income threshold that could easily be changed after 22 years.

Diane lives off a pension and Old Age Security (OAS). Since retiring, her personal and age exemptions have always surpassed her taxable income, wiping out any balance on her return.

In 2024, Diane’s taxable income was $19,772. Yet her 2025 income tax return had some cost-of-living indexing of pension and OAS, taking her taxable income to $21,114. While she owes nothing in taxes, she must now pay an Ontario Health Premium. This surcharge is levied on all taxpayers with a taxable income of $20,000.

Like many low-income seniors, Diane turns to the Happy Wanderers’ tax clinics for help. That is where Community Volunteer Income Tax Preparer Al Smith sees this premium surprising low-income seniors.

“Ontario is the only province to charge a health premium in their provincial tax calculations,” Smith stated. “After 20 years of neglect, the provincial government needs to restore fairness and a reasonable threshold of affordability to the Ontario Health Premium.”

Set in 2004, the income threshold has never been adjusted to reflect cost-of-living or inflation.

“Since it is a surcharge, it can’t be offset with the regular non-refundable tax credits,” he noted. “It’s both upsetting and an insult, that after a lifetime of contributing, limited-income seniors are having what is essentially a clawback.”

The Province simply needs to update Page 4 of its tax booklet and raise the number to a more reasonable level, he added. His analysis suggests an amount of at least $30,800.

Smith’s research shows that the premium has always disproportionally affected lower-income individuals. After all, their premium eats up a higher per cent of their taxable incomes.

He has written to Ontario Premier Doug Ford, the Minister of Finance, his Parliamentary Assistant (and Peterborough-Kawartha MPP) Dave Smith, and leaders of the opposition parties.

Only the Ministry of Finance Correspondence Team has responded. It explained that the premium is only one component of Ontario’s tax and benefits system in which many benefits are income-tested.

The writer pointed out that Ontario has the lowest provincial personal income tax rate in Canada and one of the lowest provincial personal tax burdens on 96 per cent of tax filers in the province.

To help make life more affordable, the Province provides tax relief via six programs for seniors and low-income families.

“The government reviews its income taxes and program spending on an ongoing basis,” the letter stated. “It considers changes within the context of the needs of all people in Ontario, as well as the province’s funding priorities.”

That’s not enough for Smith.

He wants the premium levied according to one’s ability to pay. He knows that Diane will have to shell out more next year, then the next.

“I feel compelled to try to advocate for my many clients who are impacted and who have no voice,” he said. “More seniors each year have tripped over that threshold and we have to tell them that they now have a balance owing to the Provincial government. I think this is grossly unfair for a 76-year-old widow living in Peterborough Housing.”

“If Doug Ford can forgo vehicle licensing fees and issue $200 to taxpayers, regardless of need, surely he could do something about the Ontario Health Premium.”

© Peterborough Examiner