Low-income people could be hit hard by carbon tax

Everyone is going to have to dig a little deeper in their wallets in these days after the carbon tax has come into effect, but some of the lowest-income people are getting hit with what the head of the Regina Food Bank called a “double-whammy.”

According to John Bailey, lower-income people could end up paying more into such a tax.

“What they’re spending their money on tends to be disproportionately affected by the carbon tax in terms of pricing,” Bailey said.

Members of the federal government, including the prime minister, have said it’s OK that you will spend more paying the tax, because you’ll get more than that back in a tax rebate.

However, not everyone files a tax return every year.

The Regina Food Bank now provides financial literacy help and Bailey said in doing that the food bank has found a higher proportion of its clients don’t file taxes compared to the general population. The reasons can range from them not knowing how to not being able to to just being distrustful of the government.

“We were a little bit surprised by the number of people who aren’t (filing an income tax return),” said Bailey.

If a person doesn’t file a tax return, they won’t get any money back from a rebate or benefits.

“So they’re sort of left in the double-whammy situation of having a high proportion of their income go to carbon tax affected goods and services, and then also not doing things to get the remediation of the government support to offset that impact on their day-to-day lives,” Bailey said.

It’s a similar situation to other benefits like the child tax credit, but Bailey said the carbon tax sticks out because of how impactful it is.

It’s unclear how widespread the problem will be. The Canada Revenue Agency doesn’t have any estimates of how many Canadians fail to file income taxes every year. But in 2016 — the last year for which numbers are available — there were 2,065,376 more people 15 years of age or older living in Canada than there were tax returns filed.