The CRA makes life more difficult for Canadians with disabilities

People with severe disabilities face a number of challenges in everyday life, chief among them financial – including barriers to employment and additional costs to manage their conditions, from mobility devices through to specialized therapy.

You don’t need to be wheelchair-bound or severely disabled to qualify for the disability tax credit. The non-refundable credit takes in a broad range of mental and physical impairments. Chris Roussakis, Reuters

André Picard, The Globe and Mail July 3, 2018

To ease the burden a bit, governments have created a number of social assistance programs and tax breaks for this growing and evolving demographic group.

Arguably, the most important of these is the Disability Tax Credit, DTC.

The credit itself is modest – since it’s non-refundable, about two-thirds of people with severe disabilities can’t claim it because their incomes are so low they pay no tax – but it opens the door to accessing a host of other programs such as the child disability benefit and the registered disability savings plan.

That’s why it’s essential that eligibility for the DTC be determined in a manner that is simple, fair, consistent and transparent.

Right now, it is anything but.

The application process is onerous, requiring a report from a physician (which often has to be paid for), a 42-step calculation to determine eligibility (which, again, often requires costly professional help) and, finally, a review by the Canada Revenue Agency that too often ends with a seemingly arbitrary rejection.

When medical professionals provide a diagnosis – based on rigid criteria, no less – pencil-pushers in the CRA have no business second-guessing a medical decision unless there is evidence of fraud.

Despite the flaws in the process, people with physical disabilities fare pretty well. The old-fashioned notion that wheelchair = disability still persists.

Those with developmental and psychiatric disabilities face much higher rejection rates when applying for the DTC; people with invisible chronic conditions such as type 1 diabetes and autism have been cut off unjustly and with little explanation.

To make matters worse, people often have to reapply and demonstrate anew that they still have a disability – as if a person with Down syndrome, for example, suddenly sheds their third chromosome 21.

Not to mention that the appeals process is opaque and utterly lacking in compassion.

These problems – which have festered for far too long, in large part because of the lack of leadership from federal Revenue Minister Diane Lebouthillier – came to a head last year.

The Senate standing committee on social affairs, science and technology investigated and exposed these problems in a report titled Breaking Down Barriers.

The senators make some sensible recommendations about fixing the DTC and related programs, and even about the treatment of people with disabilities more generally.

The two most important suggestions are that the DTC become a refundable (as opposed to a non-refundable) tax credit so it would benefit the most needy.

The Senate committee also recommends that everyone in a provincial program for people with disabilities be enrolled automatically in the Registered Disability Savings Program, RDSP.

The RDSP is one of the most innovative social programs ever introduced in Canada, a legacy of the late finance minister Jim Flaherty. It allows people with disabilities and their caregivers to set aside money for future care, tax-free (much like an RRSP).

In addition, Ottawa will match private contributions up to $3,500 annually with a $70,000 lifetime limit, and provide an additional contribution of $1,000 a year for low-income participants up to a lifetime maximum of $20,000.

The RDSP has allowed more than 123,000 Canadians to sock away $2.5-billion to ensure a little bit of financial security in their future, but it is still woefully underused. No grant or bond should go unused or unclaimed.

While the RSDP was a bold leap back in 2006, the Senate report also reminds us that although it was supposed to be a first step, little progress has been made since then.

There are 1.8 million people in Canada living with severe disabilities.

The most corrosive and debilitating problem most of them face is poverty, not their underlying physical or mental condition. Accessibility is about much more than ramps, it’s about being a full participant in society, economically and otherwise.

There is probably no group in society that would benefit more from a guaranteed basic income. As the committee notes in its report, the aspiration for all should be “economic citizenship that… advances dignity, agency, pride, confidence and self-worth; and eliminates the soul-destroying aspects of welfare.”

The tax system is not the ideal way to get there, but as long as we are depending on credits, grants and savings plans, they should at least be providing much needed benefits, not creating more barriers.

The last people who should be shaping social policies for the most disadvantaged are anonymous accountants in the Canada Revenue Agency.

Source The Globe and Mail


Also see
Breaking down barriers to the disability tax credit Policy Option Politiques
The Canada Revenue Agency Keeps People With Disabilities In Poverty Office of Tom Kmiec, Member of Parliament for Calgary Shepard
What Ontario’s changes to OHIP+ tell us about the future of national pharmacare The Globe and Mail
Championing equality, diversity and inclusion at Canadian universities The Globe and Mail
Ontario students with special needs increasingly asked to stay home: report The Globe and Mail
Tax season 2015: The disability tax credit and the push for fee limits CBC News
Find out if you’re eligible for the DTC CRA
Disability Tax Credit Promoters Restrictions Act CRA

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