Measures concerning individuals
$400 million to assist consumers.
Support for consumption
A rapid injection of $250 million
To provide a rapid boost to consumer confidence, an amount of $250 million will be paid as of December of this year.
This payment will consist of an increase of $100 per adult $200 per couple of the QST credit. The government has chosen this way of bolstering consumption because it can be implemented very rapidly.
For example, a couple who is entitled to the maximum allowable amount of the QST credit will receive, in December 2001, a cheque for $354, instead of $154, i.e. $200 more. An adult living alone who is entitled to the maximum allowable amount of the QST credit, will receive, in December 2001, a cheque for $177, instead of $77, i.e. $100 more.
How the QST credit works
Full indexation of the personal income tax system
Increase in the rate of indexation from 1.8% to 2.7%
In accordance with the commitments made in the 2001-2002 Budget Speech, the personal income tax system will be fully indexed as of January 1, 2002.
In addition, the 2002-2003 Budget Speech announces an increase in the rate of indexation, from 1.8% to 2.7%.
This indexation applies to the three taxable income brackets defined in the tax table, as well as to most of the tax credits. For example, beginning January 1, the upper threshold of the first taxable income bracket will increase from $26 000 to $26 700 for 2002, while the upper threshold of the second income bracket will rise from $52 000 to $53 405.
This increase will have a financial impact of $77 million, in favour of all taxpayers.
Main tax parameters subject to indexation in 2002
Indexation of social assistance benefits
$75 million for people with low incomes
All social assistance benefits will be indexed in January 2002 at a rate of 2.7%. This indexation is thus extended both to persons who are able to work and persons who have a severely limited capacity for employment.
In concrete terms, for 2002, the indexation of social assistance benefits will result in additional income of:
- $168 for a person living alone who is able to work;
- $240 for a person living alone with a severely limited capacity for employment;
for a couple able to work;
for a couple with severely limited capacities for employment.
This indexation represents a $75-million increase in the disposable income of some 360 000 eligible households.
For recipients of social assistance benefits who are able to work, this is the second increase in just over six months.
Illustration of the impact of the indexation of social assistance benefits