News / Ottawa

Transit tax credit was getting more and more expensive: Documents

The credit on public transit passes began in 2006 and was ended by the Liberal government in their budget this spring.

Finance Minister Bill Morneau takes questions as the Liberal cabinet meets in St. John's, N.L. on Tuesday, Sept. 12, 2017.

Andrew Vaughan / The Canadian Press

Finance Minister Bill Morneau takes questions as the Liberal cabinet meets in St. John's, N.L. on Tuesday, Sept. 12, 2017.

The Public Transit Tax Credit the government ended this year was rapidly growing in cost having risen by 90 per cent over the last decade, according to government documents on the program.

The credit on public transit passes began in 2006 and was ended by the Liberal government in their budget this spring. Through access to information Metro obtained dozens of pages of documents about the decision.

Most of the documents highlight the government’s previously stated concerns that the credit wasn’t incentivizing people to take transit as it was designed.

“We set on a course to make sure our tax system was fair and that our tax system was efficient,” Finance Minister Bill Morneau said on budget day. “We found that it was not doing what it was intended to do.”

Morneau also argued at the time that the government was delivering billions to build more transit and ultimately make riders’ lives easier.

“Our approach for making a real difference in transit for Canadians is to invest significantly over the long term, as we have identified in this budget.”

The documents obtained by Metro show the cost of the program was also rising considerably.

“In 2007, 1.3 million taxpayers claimed the credit at a cost of $110 million. By 2017, it is expected that 1.7 million taxpayers will claim the credit at a cost of $210 million.

The credit was phased out as of June this year. The government estimated that over four year it would save $1 billion by eliminating the credit. The average person claiming the credit received $154.

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