By Karen Kelly
Each year, $1.7 billion dollars in social benefits go unclaimed in Canada, sitting in programs such as the GST tax rebate, the Canada Workers Benefit and the Canada Child Benefit.
Most are meant for people who are struggling financially. As researchers who study social policy and income support for low-income Canadians, Jennifer Robson and Saul Schwartz wanted to know why people who need this financial help aren’t receiving it.
The answer? They don’t file taxes.
Professor Jennifer Robson
“When people don’t file, they are shut out from all of the cash benefits delivered through the tax system and that leaves them measurably worse off. Some families are leaving thousands of dollars on the table,” says Robson, a professor in the Master of Political Management program.
She notes that not having a tax return makes it harder for lower income Canadians to access a range of income-tested programs, from childcare subsidies, to legal aid, to pharmacare because provincial and local governments rely on tax information to check eligibility.
She and Schwartz, a professor in the School of Public Policy and Administration, used Statistics Canada data to analyze the economic situations of working aged adults who did not file. They published their findings in an article entitled “Who Doesn’t File a Tax Return? A Portrait of Non-Filers.” The article won the Canadian Economics Association’s Vanderkamp Prize in 2020 for the best paper published in Canadian Public Policy.
Professor Saul Schwartz
“We estimate that about 12 percent of working-age Canadians did not file a return and, as a result, were unlikely to have received the benefits for which they were eligible,” explains Schwartz. “We think the federal government should make serious efforts to reach those people and get them the benefits to which they are entitled.”
Robson agrees, citing the effect that would have on measurement of poverty rates in Canada.
“It’s a particularly large difference for families with children: it adds up to approximately 30,000 more kids in low-income circumstances,” says Robson. “If you are a government looking to reduce poverty, you should consider this.”
Read full story in the Faculty of Public Affairs’ Another Take…