NDP proposes boost to untaxed income threshold, removal of GST from ‘essentials’

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This article was published 26/03/2025 (365 days ago), so information in it may no longer be current.

HAMILTON – The federal NDP is proposing a series of tax measures to help Canadians deal with the financial impact of U.S. tariffs.

Under the plan put forward by NDP Leader Jagmeet Singh, anyone making less than $177,882 would not pay taxes on the first $19,500 they earn, saving them about $505 annually.

For context, in the 2025 tax year, the basic personal amount — the sum on which you do not pay federal income tax — ranges from $14,538 to $16,129, depending on your overall income.

Under the NDP’s plan, people in high-income brackets would see their basic personal amount reduced to $13,500, while those with incomes over $235,632 would pay tax on everything they earn.

The NDP estimates these tax measures would cost the federal government $10.4 billion.

Singh said his party would cover the cost by ensuring the Canada Revenue Agency enforces corporate tax compliance.

Singh said he would ensure “adequate” staffing at the CRA and give the agency a mandate to go after corporate money tied up in tax havens.

“This is not increasing taxes on the wealthiest. This is simply what they owe, what they’re supposed to pay and what they’re not paying,” Singh said.

Both the Liberals and Conservatives are proposing to reduce the lowest marginal tax rate, which is now 15 per cent.

The Liberal proposal would reduce that rate to 14 per cent, while the Conservatives would take it to 12.75 per cent over three years.

At a policy announcement in Hamilton, Ont., Singh accused the Liberals and Conservatives of coming up with tax plans that benefit people with higher incomes.

“The Liberals and Conservatives, their plans will actually help out millionaires the most,” he said. “So that’s a bad use of our funds, so we’re focused on who we’re helping and we want to help those that are impacted by the tariffs, that actually need the support. Not the billionaires, not the millionaires, but everyday working families.”

New Democrats say they would remove the GST from “essentials” such as children’s clothing, heating bills and pre-made grocery meals, a promise they estimate would cost the federal government $4.5 billion and save the average family of four $448 annually.

Singh said that while the NDP’s proposed tax cut is lower than the ones offered by the Liberals and Conservatives, its overall plan works out to a total savings of around $1,450 for a family of four with the GST exemption factored in.

To help pay for all this, the NDP would restore the capital gains tax increase introduced by the Liberals last year. Liberal Leader Mark Carney cancelled the capital gains tax hike before the election was called.

Singh said that reversal showed the Liberal leader is more focused on corporations than the middle class.

The NDP cited an estimate from the parliamentary budget officer that said the capital gains tax increase would bring in $17.4 billion over the next five years.

The party is also proposing to double the Canada disability benefit at a cost of $3 billion, and to increase the guaranteed income supplement for seniors at a cost of $4 billion annually.

Conservative Leader Pierre Poilievre also made an affordability pitch to seniors while campaigning in Montmagny, Que. He said his party would allow working seniors to earn up to $34,000 tax free, grow their RRSP accounts for longer and keep Canada Pension Plan and old age security eligibility at age 65.

Singh suggested Poilievre can’t be trusted to fulfil this promise because the Stephen Harper government increased the eligibility age for seniors benefits to 67 from 65.

The change was reversed by the Justin Trudeau Liberal government in 2016.

— With files from Craig Lord in Ottawa, Ritika Dubey in Toronto

This report by The Canadian Press was first published March 26, 2025.