Economic update: Seniors’ assistance is paid in the spring

Despite strong economic uncertainty hanging over the course of 2023 – so much so that a recession scenario had to be worked out, first – Finance Minister Eric Girard has confirmed that people aged 70 and over on low and middle incomes will receive In up to $2,000 to deal with inflation.

• Also read: COVID-19: Minister Gerrard was infected a few days before the budget update

• Also read: Quebec’s debt burden will fall despite a looming recession

As promised during the campaign, the economic update released Thursday provides for an increase in the Senior Citizens Assistance Refundable Tax Credit from $411 to $2,000.

The payment will be made to more than 1.1 million seniors when they process their 2022 tax returns.

The cost of this groundbreaking measure is estimated at $8 billion over five years. Mr. Girard indicated that 65% of this amount will be paid to senior citizens whose income is less than $ 25,000 a year.

The Caucus for a Quebec Free of Poverty deplores the fact that seniors are not eligible from the age of 65.

“In what way will people between the ages of 65 and 69 with low or moderate incomes have less urgent needs than those 70 and over? Why this distinction,” said Caucus spokesperson Serge Petit-Clerq.

• Listen to the interview with Gisele Tassi Goodman on The Philip Vincent Foisy Program, which is broadcast daily via QUB Radio :

end credit for activities

Government gives with one hand and takes back with the other, at least in part: the tax credit for activities of the elderly will be cut aside. This tax measure, which has been in place since 2014, made it possible to cover 20% of the registration fee for certain activities. It was costing the government about $2 million a year.

“It was a marginal credit compared to the improvement we’re announcing today,” Minister Gerrard said at a press briefing.

Among the new items, Quebec will follow in Ottawa’s footsteps By taxing, probably starting in the fall of 2023, vaping productswhich is expected to bring $40 million annually into state coffers.

“This is a public health measure aimed above all at protecting our young people,” said Mr Gerrard, calling vaping a “disaster”.

Record indexing

Minister Girard, who warned that no new checks will be sent to taxpayers in 2023, announced that social assistance programs and standards for the personal income tax system It will be indexed at 6.44%from the new year.

For a family with two young children whose income does not exceed $100,000, this is a $500 increase in the family allowance.

He estimates the gains for all taxpayers in connection with this record figure at $2.3 billion a year, which is roughly $2.2 billion for the personal income tax system and more than $161 million for this and it’s Social Assistance benefits.

This increase is double that applied in 2022 (2.64%). This is the strongest indicator since 2002.

• Listen to Mario Dumont’s interview with Serge Petiteclerc, spokesperson for the Rally for Quebec Without Poverty Followed by an interview with Charles Milliard, President and CEO of the Federation of Quebec Chambers of Commerce on QUB Radio :

alternative scenario

The Minister of Finance pointed out that if the high cost of living is the “dominant factor” in 2022, then “2023 is a year of economic slowdown.”

Quebec now expects economic growth of 0.7% for 2023 and 1% less in the event of a recession, when it was estimated at 2% in the budget released last spring.

In the event of a recession, a probability that Minister Girard puts at 50%, Quebec plans to provide “direct assistance to support households or sectors of economic activity most affected by the economic slowdown.”

This would likely pass a tax cut, such as the 1% promised during the election, and an improvement to the Quebec Infrastructure Plan (PQI) 2023-2033, which the CAQ has pledged to increase to $150 billion.

The context of indexing the tax system […]which is about 3% more than would be expected in inflation, does not lend itself to non-recurring amounts (checks),” said Mr Gerrard.

If the Legault government had to resort to the “alternative scenario” set forth in the Economic Modernization, government revenues would fall by $4.5 billion over five years.

The budget deficit would also be larger, up $5 billion. The base scenario projects a budget shortfall of $5.2 billion in 2022-23, compared to nearly $6.5 billion last March, and the $7.69 billion in the coalition’s financial framework, Avenir Québec that was introduced during the last election campaign.

Increased amount-paid assistance to support seniors 70 years of age or older

Senior couple aged 70 or over

Source: Quebec Economic and Financial Update – Fall 2022