Here are the details of the measures taken into account in this tool and the method used for the calculations.
1. Tax changes to tax brackets and the basic personal amount threshold
The CAQ, the PLQ, QS and the PCQ would apply changes to the income tax rates. Here is a table that summarizes the changes that would be made for different income brackets. Note: PQ is not included in the table as it would not change current rates.
QS would change the tax brackets and add a fifth. The PLQ would add one too.
In 2022, the first income bracket of the scale goes up to $46,295, the second ranges from $46,295 to $92,580, the third from $92,580 to $112,655, and the fourth applies over $112,655.
According to the changes proposed by QS, the first level would remain intact, but the second would extend from $46,295 to $90,080, the third from $90,080 to $112,655, the fourth from $112,655 to $200,000. $, and a fifth level would be created, which would go beyond $200,000.
The PLQ would also add a fifth level, at a rate of 27.75%, from a taxable income of $300,000.
The CAQ’s proposed tax rule changes would take effect in 2023, but for comparison with other parties, we have calculated as if these changes were made in 2022.
Regarding the threshold for the basic personal amount, this is $16,143 for the year 2022. Two parties would like to increase it: QS would raise it to $16,643, while the PCQ would like to raise it to $20,000 .
2. Single checks
The CAQ and the PQ offer one-time amounts, in other words single checks. These measures are therefore not recurrent.
The CAQ would pay a one-time amount of $600 to people with an annual income of less than $50,000, and an amount of $400 to those earning between $50,000 and $100,000. The PQ would send a “purchasing power allowance” of $1,200 to people with an income of less than $50,000, and $750 to those with an income between $50,000 and $80,000.
3. Solidarity credit subsidies
The PLQ and the PQ are proposing to improve the solidarity tax credit, which is aimed at low- or middle-income households. The PLQ wants to improve this tax credit by 5 percentage points annually (which would amount to 25 points over five years). The PQ, meanwhile, proposes to double the solidarity tax credit for the last six months of the 2022 fiscal year.
In our tool, we do the calculation for an individual who lives alone or who lives with one or more adults. If you are a couple or have children and are eligible for the solidarity tax credit, the enhancement of the credit would be different.
4. Tax measures to support seniors
The CAQ and the PLQ have announced additional tax support for seniors. Remember that our calculation is for a single person. If you are in a couple, the calculation of the tax measures for seniors could change, as in the case of the enhancements to the solidarity credit.
The CAQ would improve the current tax credit for support for seniors aged 70 and over as of 2022. Currently, the maximum amount to which an individual is entitled is $411. It would increase to $2,000 for a senior who is not in a relationship and who has an income of less than $24,195 per year. Aid would decrease by 5% for each dollar above the $24,195 threshold. Thus, assistance would be paid up to an income of $64,195.
In the case of a couple, the amount could reach $4,000, and the reduction threshold would then be $39,350. Thus, the assistance would be paid up to $119,340 of family income.
The PLQ would introduce a new “seniors allowance” to give seniors the financial capacity to stay at home. We assumed that it would replace the current support for seniors. This allowance, which would be individual, would reach up to $2,000 annually per adult aged 70 and over. The amount to which you would be entitled is calculated as follows: if you earn less than $50,000, you would be entitled to assistance of $2,000; if you earn more than $50,000, the amount to which you would be entitled decreases by 4% for each dollar exceeding $50,000 per person. Thus, assistance would be paid up to an income of $100,000.
The calculation is based on individual income and not on family income. A couple could then get $4000, or one of the members could get $2000 even if the other member of the couple gets nothing because his income is too high.
5. Lower gas tax
The CAQ and the PLQ have announced additional tax support for seniors. Remember that our calculation is for a single person. If you are in a couple, the calculation of the tax measures for seniors could change, as in the case of the enhancements to the solidarity credit.
6. QST holidays
The PLQ and QS propose to suspend the collection of the Quebec sales tax (QST) on certain essential products or services. As the lists of products targeted by the two parties are not exhaustive, these are estimates.
The PLQ withdrew the QST from the electricity bill as well as from certain essential products, such as medications, personal care products and household products.
For its part, QS would remove the QST from a longer list of products qualified as essential, including food products sold in grocery stores which are currently taxed, medications, personal care products, home repair services or car, clothing and food paid for in restaurants.
To estimate the average QST savings on essential goods, you must use the total household income (which includes all income, including that paid by governments, such as family allowances, the GST credit, the solidarity credit, etc.).
The average saving is calculated by quintile, using the average household expenditures by total income quintile for certain specific categories, contained in Statistics Canada’s Survey of Household Spending. The saving is then calculated as a percentage of the quintile’s average total income. This percentage is applied to the average total income reported by the calculator user. In the top quintile, the maximum savings is capped at the percentage applied to a total income of $320,000.
We prefer to give an estimate by quintile rather than an average for all households, because consumption habits vary according to disposable income. For example, a high-income household spends more in restaurants than a low-income household and would therefore save more QST on its bill.
7. New Wealth Tax
QS would introduce a new wealth tax, the mechanism of which is detailed in the table below.