Category : Costing Notes

Eliminating the Registered Retirement Income Fund (RRIF) minimum withdrawal amount

Mr. McCauley, MP, requested the PBO to cost the elimination of the annual RRIF minimum-withdrawal amount.  As a result, RRIF holders would withdraw less, thereby reducing government revenues, as RRIF withdrawals are considered taxable income.

PBO has assumed that the annual minimum-withdrawal amounts will remain the threshold for determining whether RRIF withdrawals are subject to tax withheld at the source, in accordance with current rules.

PBO has assumed the policy would take effect on January 1, 2021.

Tax Free Seniors Benefits

Mr. Ziad Aboultaif M.P. requested the removal of federal income taxes on Canada Pension Plan/Quebec Pension Plan (CPP/QPP) and OAS benefits received by seniors with limited sources of income. The funds to pay for the measure will come from general revenue of the federal government and not from an increase in future CPP/QPP contributions.

PBO estimates this program to cost $268.1 million in 2020-2021 and $1,083.4 million in 2021-2022. The time horizon for this costing is aligned to PBO’s September 29, 2020 Economic and Fiscal Scenario.

Net wealth tax on Canadian resident economic families

Peter Julian, MP for New Westminster—Burnaby, requested that the PBO use the recent publication of PBO’s refined family wealth model to estimate the revenues of an annual net wealth tax on Canadian resident economic families equal to 1 per cent of net wealth above $20 million. All asset and liabilities are included in the net wealth tax base, except wealth won in lotteries. The PBO estimates 13,800 Canadian economic families would pay the net wealth tax and that the total net revenue of this measure would be $5.6 billion in 2020-21. The time horizon for this costing is aligned to the PBO’s current Economic and Fiscal Scenario, although fiscal impacts can be expected in subsequent years.

Canada Emergency Response Benefit – Eight Week Extension and Phase-out Rate

Dan Albas, MP for Central Okanagan—Similkameen—Nicola, requested that the PBO cost a proposal modifying the Canada Emergency Response Benefit (CERB) to adopt a phase-out for the benefit of $0.50 for each dollar of employment income above $1,000 per month in addition to the eight week extension announced on June 16, 2020.  
The modifications to the CERB program are assumed to be implemented on July 5, 2020.
PBO estimates the cost to modify the extended CERB program (phased reduction) starting July 5, 2020 to be an additional $3.1 billion.

Proposed Changes to the Canadian Emergency Response Benefit (CERB)

A parliamentarian requested that the PBO cost a proposal modifying the CERB to adopt a phase-out for the benefit of $0.50 for each dollar of employment income above $1,000 per month. Modifications to the CERB program are assumed to be implemented on July 5, 2020.
PBO estimates the cost to modify the CERB program starting July 5, 2020 to be an additional $967 million.

Proposed Changes and Extension to the Canadian Emergency Response Benefit (CERB)

A parliamentarian requested that the PBO cost a proposal modifying the CERB to: extend the program to January 2021; expand the eligibility for benefits by an additional 12 weeks (to 28 weeks total); and, adopt a phase-out for the benefit of $0.50 for each dollar of employment income above $1,000 per month.  
The parliamentarian also asked that this modified CERB be compared against another option to extend the existing program over the same time period (to January 2021) and enhancing the benefits duration by the same amount (12 weeks).
Extensions and modifications to the CERB program are assumed to be implemented on June 1, 2020.
PBO estimates the cost of the proposed measure to extend and modify the CERB program to be $64.0 billion from June 1, 2020 to January 31, 2021. 
Compared to a counterfactual scenario where the current CERB program is extended until January 31, 2021, where recipients can receive up to 28 weeks of CERB payments, the modified CERB program costs an additional $6.1 billion.

Refund of Goods and Services Sales Tax for Small Businesses (January-December 2019)

This estimate was prepared at the request of a parliamentarian.

Refund of Goods and Services Sales Tax for Small Businesses (July-December 2019)

This estimate was prepared at the request of a parliamentarian.