Campaigns and Issues

Federal government indexes Child Tax Benefit to inflation


Beginning in July 2018, Canada Child Benefit (CCB) payments will be adjusted as the cost of living increases, nearly two years ahead of the previously planned adjustment. According to Finance Minister Bill Morneau, a family with two children will pocket approximately a $200 increase in Canada child benefit payments starting next year, and up to about $500 in 2019.

In a press release on the changes, Campaign 2000 highlights how the campaign has called for immediate indexation of the CCB since Budget 2016 revealed cost of living increases would be delayed until 2020. With indexation now coming two years ahead of schedule, the purchasing power of the 9 out of 10 families who receive the CCB will keep pace with rising household costs. For low income families, this could mean fewer visits to the food bank and less anxiety about bills. For the economy, this means more money to support local business and stimulate growth, says Campaign 2000.

According to the federal government, in the 2016-17 benefit year, over 3.3 million families received more than $23 billion in CCB payments, and the nine out of 10 families who are better off as a result of the CCB received on average almost $2,300 more in benefits, tax-free. The CCB has helped lift about 300,000 children out of poverty. Thanks to the CCB, by the end of this year, it is estimated that child poverty will have been reduced by 40 per cent from what it was in 2013.

Seeing the impact of the federal enhance child benefit, highlights the further reduction in child poverty that could be achieved if BC redesigns the BC Early Childhood Tax Benefit into a BC Child Benefit, extending the benefit up to age 18 and doubling the maximum benefit to $1,320 per child per year, as recommend in First Call’s 2016 BC Child Poverty Report Card. BC’s benefit currently lags behind other provinces as it is limited to the early years (0-5), and is capped at $55 a month per child.

Read a government backgrounder on the CCB here.

Read Campaign 2000’s news release here.