Changes to disability tax credit broadly welcomed by opposition, advocates

The liberalist government's project to do it easier for Canadians living with disabilities to hold for the impairment tax credit is being welcomed by the opposition and advocates who say the proposed changes are long overdue, though some say they don't go far enough. 

The changes proposed in Tuesday's spring economic update were first lauded by Conservative Leader Pierre Poilievre, whose daughter has autism and is non-verbal.

He kicked off his response to the economic update in the House on Tuesday by praising the reforms in both official languages. 

"I want to congratulate the minister for his speech and thank him for his commitment, as a father, thank him for his commitment to simplify the disability tax credit," Poilievre said.

"Our people should be spending their time living their lives rather than filling out forms. We want to make life simple for people who already have enough challenges." 

The non-refundable credit helps Canadians with disabilities who are over the age of 18 lower the amount of income tax they have to pay by a maximum of just over $1,500.

To qualify, people must first have their disabilities certified by a medical practitioner such as a doctor, nurse practitioner, occupational therapist, physiotherapist, speech-language pathologist, audiologist, psychologist or optometrist. 

Once their application is completed it's sent to the Canada Revenue Agency (CRA) which either approves or rejects the certification. 

Statistics Canada's Canadian Survey on Disability identified about eight million Canadians age 15 and older who had a disability in 2022. Of those, about 40 per cent had a condition classified as severe or very severe. 

The Canadian Tax Observatory says about 84 per cent of the eight million people living with disabilities have not been able to qualify for the tax credit. Disability advocates have been pushing to make the qualification process easier. 

While the benefit's maximum amount of $1,500 is not a large sum of money, and only rises to that full amount if applicants earn about $27,000 a year, a valid certification from the CRA is also a necessary pre-condition to access 13 other programs designed to help people living with disabilities.

Those additional programs include the Canada Disability Benefit, the Registered Disability Savings Plan, the Child Disability Benefit and the Canada Workers Benefit disability supplement.

For that reason, disability advocates have been asking for reforms to the process for how people are certified for the tax credit. 

As Poilievre pointed out in the House, one of the top complaints is that there's too much paperwork. 

Previously, when a medical practitioner certified a person's disability for the tax credit, they had to go through 16 pages of questions asking them to detail why their patient is either unable to work or must work under modified conditions. 

One of the proposed changes would streamline that process by immediately certifying people when a medical practitioner affirms they have at least one disability on a list that has been pre-approved for a kind of fast-track status. 

That means if a medical practitioner certifies that a patient has Alzheimer's disease or cystic fibrosis, they can skip the pages and pages of reasons and circumstances that hamper their ability to work. 

People with conditions that aren't on the list will have to go through the same certification process as before, however.

The Liberal government did a couple of other things to streamline the process. 

It expanded the list of medical practitioners who can certify someone to include podiatrists, and broadened the types of disabilities that can be certified by physiotherapists, speech-language pathologists and occupational therapists. 

It also allows those serving as guardians or trustees for people living with specific qualifying disabilities to certify the disability tax credit for adults in their care. 

To ensure all those changes are implemented, the federal government is giving the CRA an additional $42.5 million over five years to provide what it says will be $345 million in benefits over six years. 

Gillian Petit, a senior research associate in the Department of Economics at the University of Calgary, authored a recent report on the challenges facing people living with disabilities who are trying to get certified for the tax credit.

The report, titled Broken Links, Poverty and the Limits of the Disability Tax Credit, argues that people living with disabilities are already among the most economically marginalized groups in Canada, and the certification process needs to help rather than frustrate them. 

Len Baker, president and CEO of March of Dimes Canada, also welcomed the changes, saying they will help millions of Canadians. 

"It couldn't come at a more opportune time," he said. "As well as people not being aware that they can apply for the disability tax credit, those that do were encountering complications."

Chief among those complications was the onerous and lengthy form medical practitioners had to fill out. "For many physicians, finding the time to do that was problematic," Baker added. 

While the changes are welcome, advocates say there's more that can be improved to make life easier for Canadians with disabilities. 

Krista Carr, CEO of Inclusion Canada, said in a statement that while there were some positive aspects to the reforms, "a real commitment from government to reduce the high levels of poverty experienced by persons with disabilities was notably absent."

At present, people who qualify for provincial disability benefits are not automatically approved for certification, and advocates want that changed.

Petit says making that adjustment will eliminate a lot of duplicated paperwork. 

"While yesterday’s announcement was a good start, barriers to access ... Remain," she said. "We’ll have to keep an eye out in the fall budget to see if more barriers will be addressed."

Senior writer

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