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The federal government has unveiled a new initiative that will impact 5.5 million Canadians by 2028.
On Oct. 10, Prime Minister Mark Carney announced that Budget 2025 will contain a measure allowing low-income Canadians to receive automatic federal benefits from the Canada Revenue Agency (CRA).
Carney said millions of Canadians do not file their taxes, “either because they don’t have the resources to do so, or because they think that their income is too low for it to matter.” He said this means they miss out on benefits like the GST/HST Credit, the Canada Child Benefit, the Canada Disability Benefit, and more.
While Canadians who owe taxes are required to file a return every year with the CRA, many low-income Canadians don’t expect to owe the government any taxes and so they do not file. A 2020 study found that around 10 to 12 percent of Canadians do not file a return, and as such they lost out on an estimated $1.7 billion in cash benefits in 2015.
The new initiative will allow for 1 million Canadians to prepare a pre-filled tax return in the CRA’s My Account system beginning in the 2026 tax year. This will be scaled up to 5.5 million Canadians for the 2028 tax year.
Carney said Canadians will just need to provide “a few details” and confirm their information, and then be able to receive “all the benefits to which they’re entitled.” Carney said the program will help 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.”
Former prime minister Justin Trudeau’s Liberal government had first announced it would be creating an automatic tax filing system in the 2020 throne speech, before formally committing to implement the program in the 2023 budget.
In addition to the automated tax filing system, Carney announced the national school food program will be made permanent, which will provide meals for up to 400,000 Canadian children.
The Canada Strong Pass, which allows for free or discounted access to various cultural and national sites, will also be renewed for the holidays and for summer 2026. The pass also provides student discounts on VIA Rail train travel.
