Bill C-4 Passes

Geoff Currier

Bill C-4 has been proclaimed into law, so what do your clients need to know? For starters, not much that they didn’t already know, although there are a few eyebrow raisers.  

Hidden in C-4 – Use of Voter Data: Not connected to the tax measures in this bill is something which has created concern among privacy advocates. Bill C-4 is an omnibus bill which includes changes to the Federal Elections Act. While this is not the forum for a full discussion on this issue, it needs to be noted that political parties will now have greater ability to use voter data. This part of the bill is retroactive to 2000. 

Most recently announced was the Canada Groceries and Essentials Benefit. This one had been called the GST/HST Credit. The government suggests that this top-up to the existing credit could save a family of four up to $1,890 this year and about $1,400 a year for the next four years. A single person could save up to $950 this year and about $700 a year for the next four years.

Note the Wording: As always, it is important to note the wording used in government documents and news releases. The phrase “up to” appears repeatedly in the Finance Canada release on this bill. That means the figures used reflect the maximum possible benefit for your clients. It’s probable that the actual benefit will be lower for most of them. 

You’ll be in the best position to determine if this claim is accurate when doing tax returns this tax season. Advise your clients of their family net income levels and whether they will qualify. It may be that few of your clients will be eligible.

Tax Rate Reduction, Rebate Changes. You’ll recall that beginning on July 1 of 2025 the first marginal personal income tax rate was lowered from 15% to 14%. The government’s claim is that this measure will save a taxpayer up to $420 or a two-income family up to $840. In preparing the tax return for these clients in the next month you’ll be able to see if this claim holds up.

Another previously announced measure which is included in C-4 is the first-time home buyers’ GST rebate. This is significant for those looking to get into home ownership for the first time. The Goods and Services Tax (GST) has been eliminated for those purchasing their first homes of a value up to a million dollars. The bill also reduces the GST on first time home purchases of between a million and a million and a half dollars.

While not many first-time home buyers are looking at million dollar properties, the savings could still make the difference between purchasing or not. CRA will now be able to begin processing the rebate claims for your clients who are eligible.

The elimination of the consumer portion of the carbon tax is old news but it is also part of this bill. The Justin Trudeau government’s carbon tax had become a political liability and until Carney took a plank from the Conservatives and cut this tax, Canadians were prepared to oust the Liberals. This may have been the single biggest factor in the Liberals being returned to power. The reduction at the pumps was noticeable.

Also, the National School Food Program has been made permanent. Meals will be provided for up to 400,000 children with the government suggesting that families with two children will save $800 a year on groceries.

Something New: Auto Tax Filing. The automatic tax filing for some lower income Canadians is something new this year for CRA. The Finance Department says the automatic filing will reach up to 5.5 million Canadians. There’s that phrase “up to” again. In theory this will help provide benefits to those low-income Canadians who might not have any tax owing. The CRA will provide a pre-filled tax return to those people who will then be able to review and confirm the information. They will have a limited time to review and question their Notice of Assessment.

It may take some time to evaluate the program’s effectiveness and whether or not the government will get it right. Recall the CERB repayments debacle: it could be that errors on these auto-filed returns will take years to straighten out.

The Bottom Line: Bill C-4 doesn’t present much in the way of new affordability measures but it does formalize those measures which had been previously announced. Knowledge Bureau Report looks forward to receiving your feedback on whether or not these new policies have a positive impact on your clients.

Additional Educational Resources: DMA – Tax Services Specialist