Good afternoon, Chair and members of the committee. Thank you for the opportunity to speak about Bill C-4 today.
I'm Amanda MacKenzie, the national director of public affairs, advocacy and strategic communications at March of Dimes Canada.
March of Dimes Canada is a leading national charity committed to championing equity, empowering ability and creating real change that will help people with disabilities across the country unlock the richness of their lives. Together with our partners, we serve, connect and empower people with disabilities to participate fully in life and in their communities on their own terms.
I'm here to address the impact of Bill C-4's proposed 1% reduction in the lowest federal personal income tax rate on people with disabilities in Canada and specifically those who rely on the disability tax credit, the DTC, and the medical expense tax credit, the METC.
I very much want to thank Krista Carr, Kurt Goddard and the team at Inclusion Canada for their leadership on this file. Inclusion was the first to identify this issue in our community, and their analysis has been widely referenced, including in my own notes. I've also included with my notes a recent analysis of this issue by the Library of Parliament.
Bill C-4 will reduce the lowest federal tax rate to 14% over two years. Everyone loves a tax cut, but the problem is that it actually results in an effective tax increase for those who receive federal non-refundable tax credits, including the DTC and METC, due to the method of calculation for both credits.
The DTC and METC amounts are calculated as eligible amounts multiplied by the lowest federal PIT rate. Thus, a 1% decrease in the PIT rate would directly lower tax savings by approximately 1% of the claimed amount per claimant.
For people with disabilities, this means that the very benefits designed to offset the additional cost of living with a disability are eroded. For example, the value of the DTC will drop by approximately $51 in 2025 and by $101 in 2026 per claimant. The METC will also see a proportional reduction.
This is not just a technical adjustment. It's a real loss for nearly one million people with disabilities in Canada who depend on these credits to help make ends meet. While all recipients of non-refundable tax credits will see their effective value reduced, people with disabilities are disproportionately impacted. They rely on additional disability-specific credits to offset the cost of being a disabled person in Canada, estimated by the UN to add 30% to the cost of living. The Library of Parliament's analysis shows that a parent with a disabled child is the most impacted, with the DTC value eroding by $79.90 in 2025 alone as a result of the lower DTC base amount.
I'm here today to ask you to amend Bill C-4 to increase the base amounts of these tax credits to ensure their value is protected and that people with disabilities across Canada are not paying more to get a tax cut. This erosion of disability supports is not just a matter of fairness. It has broader policy implications. The DTC is a gateway to other federal and provincial and territorial benefits, including the Canada disability benefit, the child disability benefit and the registered disability savings plan. Reducing the DTC's value risks undermining access to these essential supports.
At March of Dimes Canada, we're particularly concerned with benefit take-up. We know that DTC uptake rates are low because of how barriered the process is. We're working with our partners, like Inclusion and others in our community, to spread awareness about the DTC and how to access it through benefit navigation services the federal government is funding. We're also working on projects to train frontline service delivery staff and caregivers in the basics of the DTC, how to access it and how to talk about it.
People with disabilities need to know what they're eligible for, like the DTC and other important benefits that Parliament decided they should have. Anything that puts a barrier in the way of this must be rectified. The solution is straightforward and affordable. Our preferred option is to amend Bill C-4 to increase the base amounts for the DTC and related credits, offsetting the reduction in the tax rate.
In closing, Bill C-4 as currently drafted provides less help to those who need it most, delivering a quantifiably smaller benefit to people with disabilities. We urge the committee to amend Bill C-4 to restore the value of disability-related credits and ensure all Canadians benefit equally from tax relief.
Thank you.