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MP Tom Kmiec Introduces Bill to Improve Access to the Disability Tax Credit

Deputy Shadow Minister for Finance Tom Kmiec has proposed legislation in the House of Commons that aims to improve accessibility to the Disability Tax Credit (DTC). This work builds on previous efforts by Canada’s Conservatives to ensure that Canadians eligible for the DTC receive it.

 

In 2017, the Canada Revenue Agency began restricting access to the DTC that affected hundreds of Canadians living with diabetes and other rare diseases, after it changed the interpretation of the rules around life-sustaining therapy and associated requirements for these types of diseases.

Bill C-399, the Fairness for Persons with Disabilities Act, amends the Income Tax Act to reduce the threshold for the number of hours necessary for an activity to be eligible for the tax credit from 14 to 10.

In the case of therapy that requires a regular dosage, it takes into consideration time spent on calculating the dosage to qualify for the DTC. This will protect diabetics and certain rare disease patients for whom the calculation of their dosage takes considerable time.

It also adds medical food and formula to qualifying for the DTC in order to add certainty for patients with certain rare diseases.

MP Kmiec added, “I expect Bill C-399, An Act to amend the Income Tax Act (disability tax credit), short title Fairness for Persons with Disabilities Act, will have favour amongst all parties. It’s a common sense bill that will leave more money in the pockets of persons with disabilities to cover the medical costs associated with managing their disease. I am committed to improving the government’s processes to ensure that all Canadians who are eligible for the DTC actually receive it.”

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MP Tom Kmiec’s: “Fairness for Persons with Disabilities Act”

 

About the Disability Tax Credit (DTC)

 

  • The purpose of the DTC is to provide for greater tax equity by allowing some relief for disability costs, since these are unavoidable additional expenses that other taxpayers don’t have to face.
  • Only 40 per cent of the more than 1.8 million people who live with severe disability in Canada use the federal DTC, meaning that most Canadians with qualifying disabilities are not accessing the credit.
  • According to the Canada Revenue Agency, in 2016 some 770,000 individuals claimed the credit for themselves. This represents more than $1.3 billion in tax relief in 2016-17.
  • Families who are approved may also apply for up to ten years of back benefits under the CRA’s Taxpayer Relief Provision. Approval also allows access to the registered disability savings plan (RDSP), a program introduced by former finance minister Jim Flaherty in 2008.

 

The Issue and Proposed Solution

 

  • Disabled Canadians rely on the tax credit to offset the costs related to managing their disease. For example, the medication, supplies and medical devices needed to manage Type 1 diabetes can cost Canadians up to $15,000 out of pocket annually.
  • In 2017, the CRA began restricting access to the DTC that affected hundreds of Canadians living with diabetes and other rare diseases by changing the interpretation of the rules around life-sustaining therapy and associated requirements for these diseases.
  • The Conservative Opposition has raised the alarm over the government restricting access to the Disability Tax Credit for Canadians to ensure that they get the benefits they deserve.
  • The Fairness for Persons with Disabilities Act amends the Income Tax Act to reduce the threshold for the number of hours necessary for an activity to be eligible for the tax credit from 14 to 10.
  • In the case of therapy that requires a regular dosage, it takes into consideration time spent on activities directly related to the determination of that dosage to protect diabetics from being rejected for the DTC.
  • It also adds medical food and formula to qualifying for the DTC in order to add certainty for patients with certain rare diseases.
  • The Fairness for Persons with Disabilities Act is partly based on a on a pre-budget submission by the Juvenile Diabetes Research Fund (JDRF).

 

Looking Forward

 

  • The bill received written support from stakeholders such as Juvenile Diabetes Research Foundation (JDRF), Diabetes Canada, Canadian PKU and Allied Disorders, Canadian Nurses Association and Canadian Organization for Rare Disorders (CORD).
  • When passed, the Fairness for Persons with Disabilities Act will leave more money in the pockets of disabled Canadians to cover medical costs associated with managing their disease.
  • The Conservative Opposition remains committed to improving the government’s processes to ensure that all vulnerable Canadians who are eligible for the DTC actually receive it.