Mark Carney’s tax plan will lift more Canadians ‘above the poverty line,’ advocates say

Posted on October 12, 2025 in Inclusion Delivery System

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TheStar.com – Federal Politics
Updated Oct. 11, 2025.   By Ryan Tumilty, Ottawa Bureau

Prime Minister Mark Carney said that starting in 2027, the Canada Revenue Agency would begin auto-filing tax returns for low-income Canadians, allowing them to simply confirm the information in a pre-filed tax return.

OTTAWA—Many poorer Canadians will get the government benefits they are entitled to and could be lifted out of poverty thanks to Ottawa’s plan to set up auto-filing tax returns for low-income citizens, activists say.

Prime Minister Mark Carney announced Friday that starting in 2027, the Canada Revenue Agency (CRA) would begin auto-filing tax returns for low-income Canadians, allowing them to simply confirm the information in a pre-filed tax return. By 2029, the government’s program would see 5.5 million people offered the service.

“This program will pay out hundreds of millions of dollars in benefits in the next few years that would otherwise be left unclaimed, helping our most vulnerable get the supports that they need,” Carney said.

The Canada Child Benefit, the GST credit and the Canada Disability Benefit are among several benefits that Canadians can only receive if they file a tax return.

Neil Hetherington, CEO of Toronto’s Daily Bread Food Bank, said the change could make a real difference in reducing poverty.

“I’m going to choose to be optimistic. I know that it will make a difference for Canadians,” he said. “We didn’t know that this was coming today and so, it gives us an opportunity to give thanks this weekend.”

Hetherington said the food bank has clients who once they file tax returns discover they are eligible for benefits that help them make ends meet.

“If you think about the social benefits that we have, navigating that system is far more difficult than navigating health care,” he said.

He said giving people benefits they’re entitled to can help prevent them from getting into difficult situations in the first place.

“We know that when you take care of poverty upstream, that it is far less expensive when it comes to things downstream, like the costs associated with homelessness.”

Elizabeth Mulholland, CEO of Prosper Canada, a national group focused on poverty, said these 5.5 million people will all benefit from the program, some in a potentially life-changing way.

“It will certainly mitigate poverty and for some people, it will definitely get them above the poverty line,” she said.

Prosper Canada did a long-term study working with 14 community programs over the course of eight years, offering tax help and free filing services. On average, the charity found people $3,600 in benefits or refunds. She said in one case where tax preparers helped file tax returns going back years, a person was able to get more than $70,000 in benefits.

Carney’s proposal would see the CRA prepare tax returns using information the agency already has from employers and financial institutions. It will be phased in gradually starting with one million people next year and apply to people who make less than either the federal or provincial basic personal amounts on a tax form. For someone living in Ontario, that would be the provincial amount, which is $12,747 in 2025.

Mulholland said the government should make sure the program is well advertised, because scammers often impersonate the CRA. She also encouraged the government to make the process simple and straightforward. She said automatic tax filling is ultimately about giving Canadians the society they chose.

“Canadians voted for these laws, we voted for these benefits. Parliament put them through and it’s really the administration’s job to make sure everybody who’s eligible is getting them,” she said.

Carney also announced that the National School Food Program would be made permanent through legislation. The program announced in 2024, had three years of initial funding, but the prime minister pledged to make it permanent with $216 million in annual funding starting in 2029. He also extended the government’s Canada Strong Pass, which offered free entry to national parks and museums, as well as reduced or free travel on Via Rail this past summer. The pass will return from Dec. 12 to Jan. 15 and again next summer.

https://www.thestar.com/politics/federal/mark-carneys-tax-plan-will-lift-more-canadians-above-the-poverty-line-advocates-say/article_d4a33fba-ff96-40cf-b69f-3f883d52c724.html?source=newsletter&utm_content=a01&utm_source=ts_nl&utm_medium=email&utm_email=0C810E7AE4E7C3CEB3816076F6F9881B&utm_campaign=pol_hl_22963

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